Sunday, February 5, 2023

Week-end Wrap – Political Economy – February 5, 2023

Week-end Wrap – Political Economy – February 5, 2023

by Tony Wikrent


War

Russian Foreign Ministry Rejects Blinken and Nuland Proposals, Condemns Scholz for Reviving Hitler’s Plan to Destroy Russia 

John Helmer [Dances with Bears, via Naked Capitalism 1-29-2023]

The Russian Foreign Ministry has dismissed proposals issued this week in Washington by US Secretary of State Antony Blinken and his Under Secretary, Victoria Nuland. Ministry spokesman Maria Zakharova has confirmed that Russia’s military plan for the Ukraine will not be interrupted or delayed.

“It is not necessary to talk about what will happen if someone does something [in the Ukraine],” Zakharova said. “There is a situation on the ground that we are solving. Everything. This is not a question of guesswork, but of our assessment of what is happening. This is based on the situation on the ground and direct political statements by Western politicians. Given that all negotiations have been terminated by Ukraine, this issue will be resolved on the ground. Under pressure or on its own, Kiev has banned any negotiations with Russia at the government level. So that’s it. The rest is for the military experts.”

Russia has also dismissed German Chancellor Olaf Scholz as the successor of the Nazi Wehrmacht and the puppet of the US Government. Scholz, according to Zakharova,  is one of the Germans who “lack[s] the spirit to make the right choice, not to repeat the mistakes of their ancestors, for which the people of Germany, among others, paid a huge price… We remember well what German tanks are. These are machines which have become a symbol,  not just of death and deadly ideology, but of hatred of humanity — a global, existential threat to the entire planet…

[TW: Not the language of diplomacy. At all.]


Sanctions and Geography are Replacing the Russian Oligarchy With State Planning, Producing a Better Growth Rate than the US, Germany

John Helmer [Dances with Bears 1-31-2023]

There is nothing like facing the gun muzzles of the Germans, British and Americans to teach Russians what to do to correct their past mistakes.  The International Monetary Fund (IMF) would be the last US bank in the world to admit as much.

Nor would the IMF concede that everything it bribed the Kremlin to accept, when Boris Yeltsin was president and Anatoly Chubais and Alexei Kudrin were his economic ministers,  is now being reversed – at a speed unmatched since Joseph Stalin directed the relocation of heavy industry out of reach of German guns between August and December of 1941.  

This time round, the IMF is reporting that after Russia recorded a 2.2% drop in real Gross Domestic Product (GDP) measurement in 2022 – 35% less than the IMF had been forecasting – by 2024, the second and third years of the war, the Russian growth rate will be more than double the US, British and Japanese rates; 33% better than Germany’s; 24% better than France; 29% better than Canada.    

This is the first official acknowledgement by the US and international banks that the long war against Russia is being lost.


Concerning the arguments for ‘total defeat’ of Russia 

[Responsible Statecraft, via Naked Capitalism 1-29-2023]

Zealous advocates of Western support for the total defeat of Russia in Ukraine — including, if necessary, direct Western intervention and NATO-Russia war — base their case on a disparate set of arguments, almost every one of which turns out on examination to be either exaggerated or wholly mistaken.

 

Inside the global battle over chip manufacturing 

[The Verge, via Naked Capitalism 2-3-2023]

Chris Miller, Tufts professor and author of Chip War: The Fight For The World’s Most Critical Technology walked me through a lot of this, along with some deep dives into geopolitics and the absolutely fascinating chip manufacturing process. This one has everything: foreign policy, high-powered lasers, hotshot executives, monopolies, the fundamental limits of physics, and, of course, Texas….

EUV lithography uses light at a wavelength of 13.5 nanometers, an ultra-small light far smaller than the wavelength of visible light. You need really small wavelength light because the circuits you’re carving are very, very tiny; they themselves often measure just a couple of nanometers in dimension. Producing this type of light is really hard, because it’s right next to the X-ray spectrum. Production of it is complicated and the development of mirrors to reflect it is also very difficult.

Here’s how the process works. A ball of tin falls at a rate of several hundred miles an hour through a vacuum and measures around 30 millionths of a meter in diameter. It is pulverized by two shots from one of the most powerful lasers ever deployed in a commercial device and explodes into a plasma measuring several times hotter than the surface of the sun — several hundred thousand degrees Fahrenheit. This plasma emits EUV light at exactly the right wavelength of 13.5 nanometers, which is then collected via a series of about a dozen mirrors, which themselves are the flattest mirrors humans have ever produced. The mirrors reflect the light at just the right angle so that it hits the silicon wafer and carves the circuits on the chips that make your iPhone possible….

The US is thinking about next-generation military and intelligence systems that will increasingly rely on artificial intelligence. AI systems are trained in vast data centers that are full of sophisticated chips like GPUs, which are the type of chips that are used to train AI systems.

If you can’t mass manufacture cutting-edge chips, then you can’t get the data center capacity that you need to train AI systems. The US is ultimately trying to accomplish stopping China from developing advanced data centers. It’s using the machine tools as the choke point, preventing US firms, and also Japanese and Dutch firms, from transferring this equipment to China.

[TW: Obviously, very difficult to replicate by a survivalist or prepper using their bowie knife. Then the interviewer asked a question that screams out the disassociation from reality of the “free market” ideology of Western elites: ]

How did we even end up in a situation where there’s one Dutch company that we have to get a hold of in order to make sure China doesn’t gain these capabilities? Again, in a functional market, especially for something like chips, which are so important to everything, there would be multiple companies with multiple different approaches to making chips at the scale that modern chips are required to be made at the process nodes that we operate at now. Instead, there’s just one and it’s in the Netherlands. How did that happen?

Well, across the chip industry, over the last couple of years you’ll find that there has been a real trend to concentration, with in many cases just a handful and in some cases just one company capable of producing the types of software and machinery involved. There’s two reasons for that. One is that many parts of the chip-making process are just brutally capital-intensive. It’s extraordinarily expensive to make this machinery. That really disincentivizes competition, because a new entrant has to spend billions of dollars before they can see if their product even works.

[TW: So, it all goes back to Alexander Hamilton’s argument that to break from the British model of imperial economics, you MUST have national economic development—which must be fostered, nurtured, and protected, by the national government. What tragic irony that it is now the United States that is intent on preventing national economic development and enforcing imperial economics. ]


The Lights Wink Out In Asia 

[The Scholar’s Stage, via Naked Capitalism 2-3-2023]

Japan’s 2022 National Security Strategy concludes with a dramatic pronouncement:

Ministry of Foreign Affairs Japan, prov. translation National Security Strategy of Japan (Tokyo, 16 December 2022): 

“At this time of an inflection point in history, Japan is finding itself in the midst of the most severe and complex security environment since the end of WWII. In no way can we be optimistic about what the future of the international community will hold.

I find myself strangely affected by this document. There was once a dream that globalization might save the world….

I read the National Security Strategy of Japan with the same trepidation I read the Jake Sullivan’s speech on chip export controls.11 I believe the Japanese have judged correctly; I support the Biden administration’s attempt to blunt China’s technological edge. But it is difficult to see these things play out in real life and feel any sense of victory. We are sliding into a darker world order. The Chinese got there first; we should have followed long ago. There is little sense in keeping to old forms that do not match present realities. But the old forms will not go unmourned. It is always sad to watch a dream die.

[TW: A Chinese spy balloon? Seriously? I’m not even going to link to such nonsense.]


This is plutocracy, not capitalism

Amazon’s Endgame: The company is transitioning to become an unavoidable gatekeeper in all commerce.

David Dayen, February 3, 2023 [The American Prospect]

Amazon has long wanted to become not indispensable, but unavoidable. The key difference there is that a company is indispensable through quality of service and affordability; a company is unavoidable simply by being in the way. Amazon needed to try a lot of different strategies to create this unavoidability, and naturally some of them did not succeed. But their route to the main goal is coming into focus—and it should alarm anti-monopoly critics who believe (rightly in my view) that no company should be de facto mandatory for most consumers and sellers….

Over the holidays, Amazon added fees to its third-party fulfillment service, where it handles shipping and logistics for independent sellers. This is where much of its revenue comes from on the retail side: Seller fees give Amazon four times the margin of typical retail sales, according to a 2018 Morgan Stanley analysis. A December 2021 report from the Institute for Local Self-Reliance showed that Amazon took 34 cents out of every dollar in third-party sales that year, nearly double what it took seven years earlier.


Alarm bells, arrogance and the crisis at Wells Fargo. Chapter 2: “Rainbows and butterflies” 

[American Banker, via Naked Capitalism 2-2-2023]

Fake accounts. Executives who only wanted to hear good news. Tens of billions of dollars in damage. As the bank’s chief security officer, Michael Bacon spent years raising concerns about rampant sales abuses. In exclusive interviews, he details how the bogus-accounts scandal unfolded — and argues that it could have easily been stopped.

Part two of a five-part series.


The $109 Billion Bank Hustle 

Matt Stoller [BIG, via Naked Capitalism 2-1-2023]

“Interoperability isn’t just for telecom firms, email, and Facebook. In a high interest rate environment, it’s also how to stop banks from scalping businesses and consumers.”


Add 4,281 Hedge Fund Clients to What Makes JPMorgan Chase the Riskiest Mega Bank in the U.S.

Pam Martens and Russ Martens, January 30, 2023 [Wall Street on Parade]


A Wall Street Time Bomb 

David Sirota, February 2, 2023 [The Lever]

...Earlier this month, Pitchbook — the premiere news outlet for the private equity industry — declared that “private equity returns are a major threat to pension plans' ability to pay retirees in 2023.”

With more than one in ten public pension dollars invested in private equity assets — and with states continuing to keep their private equity contracts secret — Pitchbook cited a new study finding that losses from the investments may be on the horizon for retirement systems that support millions of teachers, firefighters, first responders, and other government employees….

Signs of a doomsday scenario are already evident: Some of the world’s largest private equity firms have been reporting big declines in earnings, and federal regulators are reportedly intensifying their scrutiny of the industry’s writedowns of asset valuations. Meanwhile, one investment bank reported that in its 2021 transactions, private equity assets sold for just 86 percent of their stated value last year.

But while pensioners may be imperiled, Wall Street executives are protected thanks to their heads-we-win-tails-you-lose business model: Some of the firms managing pensioners’ money are reporting asset losses for investors, while raking in even more fees from investors and continuing to raise executives’ pay.


Civic republicanism is the underlying issue

I’m a corporate fraud investigator. You wouldn’t believe the hubris of the super-rich 

[Guardian, via The Big Picture 1-29-2023]

Generally, I’m looking for red flags: accounting abuses, yes, but also egregious business practices, such as failure to pay suppliers. We want to answer the question: is the business doing what it says it’s doing, to the standard it should be? And if not, can that company really be worth what the market believes it is?

I use a number of methods to do this. Some you might expect – financial reports, local filings, data sets – but others you might not, including social media. Recently I was deep in the Instagram account of a CEO whose company we believe is a house of cards. I gazed for a long time at a snap of a family member, posing on the steps of a private jet with champagne and a gun. If I had to paint a portrait called “hubris”, it would look something like that….

But while the fraudsters I’ve encountered are generally clever – or at least cunning – sooner or later something interesting happens: they get carried away. Drunk on their own genius, they concoct grander schemes, more flamboyant methods. They give large contracts to family members, who are themselves shareholders in the company. They fire their top-tier auditor and bring in a no-name firm….

The consequences of this hubris can be catastrophic. Investors risk losing money, of course, but people also risk losing their lives, perhaps because the company has made savage cuts in lifesaving equipment they use or sell, or through cheating their own emissions tests (Volkswagen), or pretending they can monitor cancer from blood samples (Theranos).

There is something unique to our era that encourages the charlatan. As well as investigating corporations, I am also a novelist, and I think we live in the age of the corporate fairy-tale: a magical land of unicorns and eternal growth. “What’s the story?” investors like to ask about the latest hot start-up, willing the narrative to be true even as they live the myth of their own absolute rationality....

Is corporate wrongdoing on the rise? Statistics certainly suggest so. The US Securities and Exchange Commission’s latest annual report on its whistleblower program showed a record 12,210 tips were provided in 2021 – a 76% increase against 2020, itself a record-breaker. The commission also made more financial awards to whistleblowers than in all previous years combined – in other words, the information given was real and significant enough to lead to real consequences.

[TW: One of the great lies we have been taught is the influence of John Locke’s ideas onthe creation of USA. Much more important was Algernon Sydney, and his 1680 masterpiece, Discourses Concerning Government.  Sydney explained the nature of man.

"Man is of an aspiring nature, and apt to put too high a value on himself. They who are raised above their brethren, though but a little, desire to go farther; and if they gain the name of king, they think themselves wronged and degraded, when they are not suffered to do what they please. In these things they never want masters; and the nearer they come to a power that is not easily restrained by law, the more passionately they desire to abolish all that opposes it.”

But I consider the greatest and most concise formulation of an oligarch’s mind is Milton’s Satan saying in Paradise Lost, “tis better to reign in Hell than serve in Heaven.”

Milton and Sydney, of course, are two of the preeminent theorists of civic republicanism. -end TW]


Is Liberalism Worth Saving? (forum)

by Patrick J. Deneen, Francis Fukuyama, Deirdre Nansen McCloskey, Cornel West [Harpers, February 2023]

[TW: West twice attempts to bring civic republicanism into the conversation: “But there’s a civic republican tradition that’s important for Lincoln here. We can’t allow liberalism to get credit for everything.”, but the other participants continued to conflate republicanism and liberalism. ]



“We’re Ruled By [glass bowls] Because We Have [glass bowl] Systems: Notes From The Edge Of The Narrative Matrix”

[Caitlin’s Newsletter, via Naked Capitalism Water Cooler 2-2-2023]

“People have a fairly easy time accepting that things are fucked because we are ruled by corrupt assholes. They have a much harder time accepting that we are ruled by corrupt assholes because our corrupt asshole systems will always necessarily elevate corrupt assholes to the top. It’s easier to blame our problems on oligarchs or the Deep State or a cabal of satanic pedophiles than it is to blame them on systems that we ourselves participate in and have lived our entire lives intertwined with and which have been continuously normalized within our culture. If the problem is just a few corrupt assholes then it’s not a very daunting problem, because all you have to do is remove those corrupt assholes and everything’s golden. If the problem is the systems around which our entire civilization is structured, it’s far more daunting. It’s easy to imagine a future without corrupt assholes. It’s almost impossible to imagine a future where human behavior is not driven by profit for its own sake, where we have moved from competition-based systems to collaboration-based ones where we all work together for the common good.” • Hence, the destruction of public health and, in fact, the very notion of a “public” (but maybe it was time for that?)

[TW: How can entire systems go bad? Because they adopt the wrong philosophy of governing. To be more precise: liberalism replaced civic republicanism, killing off the idea that individuals must balance their liberty (now mal-defined as the freedom to loot and accumulate, i.e. “shareholder value”) with their civic responsibility to each other and to society (mal-defined by conservatives and libertarians as “socialism”). ]


“Why they condemned socialism”

[Carl Beijer, via Naked Capitalism Water Cooler 2-3-2023]

“The reason our ruling class singles out socialism for condemnation is that they are specifically afraid of the socialist agenda. They aren’t worried about ‘progressives’ because they know that’s code for ‘liberals and socialists who won’t make socialism a priority.’ They aren’t worried about ‘populists’ because they know that’s code for ‘edgy centrists who want standard centrist reforms.’ But socialism terrifies the ruling class, because try as they have to redefine it, they still haven’t dissociated it from its core agenda. Socialists want nationalization, socialists want worker control of the means of production, socialists want the abolition of private property, socialists want the decommodification of necessities, and these are all things that the ruling class absolutely does not want. Make vague demands about ‘structural change’ or ‘draining the swamp’ and they can work with it; hell, most of our politicians run for office with slogans like this. But make the specific demands that socialists make and all they can say is ‘hell no.'”


How the Left Should Exercise Power Once They Have It

Thomas Neuburger, February 1, 2023 [God’s Spies]

In a piece called “Why the Left Keeps Losing and What They Must Do to Win,” Ian Welsh writes this about what happens when anti-Left governments take power….

“​​​​​​​The left, bless their hearts, tend to think that there are rules, and that they can play by them, win, and be allowed to rule. But all along the process, the left’s opponents do not and will never play by the rules when facing the left.”

[TW: The “left” has a fundamental philosophical flaw: leftists believe that human nature is inherently good, and can be perfected by changing the institutional structures of the economy and polity. 

By contrast, the philosophy of civic republicanism on which USA was founded, begins by recognizing the defects and weaknesses of human nature, and demanding that political structures be built to guard against those defects and weaknesses by incorporating checks and balances in the political structure. As I have noted repeatedly the past few weeks, a number of republican theorists explained the nature of oligarchs as insatiable greed and lust for power (see the link on “Amazon’s Endgame”).

At the same time, civic republicanism recognized the capacity of human beings to do good, and demands that political structures also be built to nourish the human spirit and encourage the development and application of the powers of reason (reading the early 19th century debates on creating systems of public education is a mind-boggling exercise in realizing how impoverished and jaded our age’s political discourse has become). On this last point – the promotion of doing good – it is instructive to look at Hamilton’s policies for promoting manufacturing, the early commitment of the federal government to promoting science and technology, and the fundamental role of the national government in creating technological and economic progress. All the devices and technologies you are using to read this — whether on a personal computer or a cell phone — began as projects of the USA national government. —end TW ]


What Hungary’s Purge of Senior Military Officers Can Teach Us All

Ian Welsh, January 31, 2023

American elites, internally, operate by a simple rule that if a member doesn’t betray the class, they don’t go to prison and they don’t lose their cushy lifestyle, even if they lose their power. There’s been some movement to hold Trump to account, but it’s half-hearted, simply because elites don’t want “their” president to be the one on the chopping block next. They all do things which could be considered illegal, after all, they’re little better than Mafia dons.

But if the stakes are “I keep power or I lose everything” then the game changes. The problem is that knowing they essentially have immunity, crimes in the elite class  have become worse and worse over time.


Restoring balance to the economy

[Twitter, via Naked Capitalism Water Cooler 1-31-2023]

x

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US Caterpillar-UAW workers authorize strike by more than 98 percent 

[WSWS, via Naked Capitalism 1-31-2023]


The Week CNBC Started to Panic 

Matt Stoller [BIG, via Naked Capitalism 1-29-2023]

“The government filed an antitrust case to break up Google, and the Senate held a brutal hearing on Ticketmaster’s monopoly. Wall Street opinion leader Jim Cramer is officially freaking out.”


This issue I’m going to summarize an extraordinary week, with three major events taking place. Two represent progress for anti-monopolists. There was a groundbreaking Senate hearing on Ticketmaster’s monopoly, and the government filed a case seeking to break up Google. Wall Street is nervous at all the activity, which is why CNBC’s Jim Cramer went on a rant against FTC Chair Lina Khan.

The third event is more low-profile, but represents a major win for Big Tech. Ken Buck, the leading anti-monopoly Republican Congressman, just got fired from his position as the head of the antitrust subcommittee….

Tuesday morning, Ticketmaster got roasted. That afternoon, Attorney General Merrick Garland announced that the Antitrust Division, along with eight states, filed an antitrust suit to break up Google’s advertising business.

That’s a powerful one-two punch, and Wall Street reacted angrily. Live Nation is a beloved asset among financiers, because billionaire consolidator John Malone, who is an opinion leader in corporate America, has controlled it for years. And Google is one of the two most important stocks in the market, with many hedge funds leaning on the firm for reliable returns. To have both of these firms hit in one day by populists they used to be able to ignore is outrageous. Populists are supposed to be silly and harmless, not challenge bankers in their core competency.


Attacking the ‘You Are the Product’ Economy: The FTC takes action against GoodRx for sharing personal health data with advertisers.

David Dayen, February 2, 2023 [The American Prospect]

Consumer Reports broke the story in March 2020 that GoodRx sells customer data to over a dozen internet companies, including Google and Facebook. This allows tech firms to tie the names of the medications people research to their phone or laptop.

It also violates health privacy laws, which are among the strongest. The FTC has had a Health Breach Notification Rule in place since 2009, which requires companies with access to personal health records to explain to consumers when that data has been shared with others without their knowledge. In September 2021, under new chair Lina Khan, the agency warned health apps that they must comply with the rule. Yesterday, it took action against GoodRx, wielding the health breach rule for the first time.

The fine of $1.5 million was smaller than I’d have liked. But beyond that, the FTC prohibited GoodRx from sharing user data with any third parties for the purpose of selling ads, required it to seek user consent (in a straightforward manner, without deceptive user screens) for any sharing of health information whatsoever, forced it to get third parties to delete the data they have, and limited the time frame for GoodRx to retain that data. This is the first time a government agency has asserted that sharing health data for ads is illegal.


How Biden Can End Secretive Corporate Tribunals

Sarah Lazare, February 2, 2023 [The American Prospect]

But while foreign investors can sue governments, it doesn’t go the other way around; outside of certain narrow counterclaims, governments, people, unions, or groups impacted by those companies don’t have the ability to levy cases against companies. It’s as if there were a soccer match, and penalties could only be called against one team. “This is why we find it profoundly unjust,” Pérez-Rocha said. “Governments never win anything. They might not lose a case, but they don’t win anything. Companies don’t have anything to lose.”

Agreements typically allow companies to bring ISDS cases in response to violations of “fair and equitable” treatment. Melinda St. Louis, the director of Public Citizen’s Global Trade Watch, explains that corporations and some tribunals have interpreted this standard broadly. “When [corporate] expectations are different from what happened, they say it is unfair, even if domestic companies received the same treatment,” says St. Louis.

Another common standard is the protection against indirect expropriation, which has been interpreted by some tribunals as government actions or rule changes that reduce the overall value of an investment, or threaten expected future profits. “This asks taxpayers to fund the business risks of international investors,” says Ruth Bergan, the director of the Trade Justice Movement. “It puts private risk into public hands. It socializes risk.”


Class Warfare

Fear And Loathing Among The Union Busters 

Julia Rock, January 31, 2023 [The Lever]

At a gathering of the National Restaurant Association’s legal arm, lawyers and executives grappled with a worker uprising.


“Nearly 36 Million Americans Who Tested Positive for COVID-19 Report Having Long COVID Symptoms — Including More Than 40% in Mississippi” 

[Value Penguin, via Naked Capitalism Water Cooler 2-3-2023]

Stunning and important chart.

41% of Americans with household income of less than $24,000 have Long COVID. For Americans with household income over $200,000 17% have Long COVID.

Radhika Desai and Michael Hudson Discuss the Causes and Politicization of Inflation

[Naked Capitalism 1-29-2023]


“Blackstone steps up tenant evictions in US with eye on boosting returns”

[Financial Times, via Naked Capitalism Water Cooler 1-31-2023]

“Blackstone has filed eviction lawsuits against hundreds of tenants across the US as it winds down one of the real estate industry’s most generous pandemic-era forbearance programmes, in a move that executives say will boost financial returns at the company’s redemption-hit real estate fund. Court records from Georgia and Florida show that companies owned by Blackstone have commenced legal proceedings against dozens of tenants every month since August, launching more cases in a typical week than the total for the first seven months of 2022. At the same time, consultants working for Blackstone have been calling local politicians in California to warn of a probable uptick in evictions in areas of the state that have significant numbers of delinquencies, said people familiar with the conversations. The outreach from Blackstone points to the delicate task confronting the private equity group, one of the biggest landlords in the US, as it seeks to maximise returns while operating under far more public scrutiny than local property owners in what has historically been a fragmented market. Blackstone bought billions of dollars worth of apartment buildings, suburban houses and other residential assets during the pandemic.” I would have thought they bought those assets after the Great Financial Crash. Oops. More: “Many of those acquisitions were made by Breit, a $69bn fund aimed at wealthy individual investors that last month imposed limits on withdrawals to curb a rush of investors trying to pull their money out.”


“Swimming in cash, Chevron plans a $75 billion slap in the face to drivers”

[CNN, via Naked Capitalism Water Cooler 1-31-2023]

“While many blue-chip companies reported lower profits last year, Big Oil was having a moment. Crude prices surged, thanks in part to high demand and reduced supply. All of that helped make Chevron the top-performing Dow stock of last year, with shares surging more than 50%. To be clear: It’s not that Chevron, or any of its peers, did anything special to earn their windfall profits last year. There was no big innovation or breakthrough — they just got rich off the price of oil shooting up. Chevron, which is expected to report Friday that profits for 2022 doubled to more than $37 billion, is essentially balking at calls from the White House and some members of Congress to funnel its extra cash into more drilling capacity to help reduce prices for inflation-weary customers. Instead, Chevron is buying $75 billion worth of its own shares, and jacking up its quarterly shareholder dividend. Chevron’s buyback package is so large, according to Bloomberg, that it could fund more than four years of drilling and other projects.” 


The Billionaires Just Can’t Wait 

Jessica Wildfire [OK Doomer, via Naked Capitalism 2-1-2023]

Recently, I’ve started digging back through Naomi Klein’s The Shock Doctrine: The Rise of Disaster Capitalism. It’s come up a few times.

Klein describes a level of corruption you’d expect to see in a dystopian novel, but she’s only narrating and documenting American economic policy over the last several decades, as the rich and powerful impose their free-market solutions for everything on everyone and take advantage of disasters and tragedies to do it. As she reveals in extensive detail, an entire shadow network of billion-dollar companies have consistently strongarmed world governments into privatizing all public goods and services, especially education and healthcare. As just one example, she explains how Milton Friedman’s final stroke of evil genius before his death was to kickstart the privatization of New Orleans public schools after Hurricane Katrina. A slew of firms also descended on the city in the aftermath of the disaster. They made a fortune by turning public housing into condos.

Katrina’s just the beginning….

They originally intended to make a killing off vaccines. They didn’t want to stop transmission of the virus. They didn’t want masks or clean air. They didn’t want to eliminate Covid. That wouldn’t be profitable.

Here’s what they wanted:

They wanted the coronavirus to continue circulating and mutating. They wanted more variants. More variants meant more sales. That’s how disaster capitalists think. They don’t see things like pandemics as tragic events that should be stopped. They see them as opportunities to build wealth.

Everyone from Bill Gates to Charles Koch thought this:

Why end a pandemic, when you can manage it?

That was the plan.

The ownership class would preside over the continued mass infection of every other class, while keeping themselves safe with the latest vaccines on top of masks and air cleaning technologies. We got a peak of that at the World Economic Forum meeting in Davos.


Survey: Nearly two-thirds of Americans are living paycheck to paycheck 

[The Hill, via Naked Capitalism 1-31-2023]


The Crackdown on Cop City Protesters Is So Brutal Because of the Movement’s Success 

[The Intercept, via Naked Capitalism 1-30-2023]

“One protester was killed by police, 20 were charged under a ‘domestic terror’ law, and Georgia’s governor gave himself broad ’emergency’ powers.” 


How a Drug Company Made $114 Billion by Gaming the U.S. Patent System 

[NYT, via Naked Capitalism 1-29-2023]


Salve Lucrum: The Existential Threat of Greed in US Health Care 

[Journal of the American Medical Association, via Naked Capitalism 2-1-2023]

“Perhaps the demoralization of professionals, the conflicted consciences of many executives, and the anger of the public represent potential political energy that, with proper leadership, can become kinetic.”

[Lambert Strether notes this would be “ironic given that the AMA — rather, its hegomonic leadership who as usual are a mere synecdoche for the views of the membership — vehemently opposed single payer for many years.”]


Climate and environmental crises

Wind Turbines Taller Than the Statue of Liberty Are Falling Over

[Businessweek, via The Big Picture 1-29-2023]


Texas Breaks All-time Natural Gas Production Record in 2022

[energyjobshop.com, via Feedspot Today]


Geothermal Drinks Gas’s Milkshake

Lee Harris, February 3, 2023 [The American Prospect]

Over the course of the last decade’s shale boom, oil field drilling companies led a revolution in directional drilling and hydraulic fracturing (“fracking”) techniques. They perfected long, spindly pipes and fine-tuned self-adjusting diamond-cutter drill bits.

Those technologies, which can endure high temperatures and shoot water through rock, have already solved engineering challenges for geothermal. Rather than relying on places where there is a naturally occurring confluence of water, heat, and porous rock, geothermal developers now have the ability to drill into solid rock, inject water at high pressure, and collect the heated water.

Geothermal isn’t just a freak offshoot of the fossil fuel industry, however. They could be ongoing allies. Oil and gas companies, from oil field services firms to investor-owned utilities, are considering the advantages of a geothermal boom. Utilities could potentially retool gas pipelines as clean geothermal networks, and the oil field services industry could see reason to sell its proprietary technology to geothermal developers.

Dry oil fields could be repurposed as geothermal wells, and those oil fields, like many geothermal sites, are rich in prized minerals like lithium and manganese. That could help solve the up-front cost problem, as companies seeking those minerals will offer advance market guarantees.


Supercharging Green Public Power 

Ryan Cooper, February 3, 2023 [The American Prospect]

The president’s signature climate bill is a huge deal for publicly owned electricity. But it will take work to unlock its potential.


Information age dystopia

[Twitter, via Naked Capitalism Water Cooler 2-1-2023]

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Democrats' political (and now medical) malpractice

“Biden’s Ending of the Covid Emergency Is a Public Health Disaster”

Gregg Gonsalves  [The Nation, via Naked Capitalism Water Cooler 2-2-2023]

“[T]wo recent decisions—by a Democratic Congress and the Biden White House—represent harmful action rather than harmful inaction. Let’s start with the omnibus bill signed in December…. In 2020, Democrats and Republicans—yes, in bipartisan fashion—allowed people on Medicaid to continuously stay on the rolls until the public health emergencies that had been declared at the beginning of the pandemic were lifted. This was a momentous decision and a wise one. According to the Kaiser Family Foundation, ‘Total Medicaid/CHIP enrollment grew to 90.9 million in September 2022, an increase of 19.8 million or more than 27.9 percent from enrollment in February 2020.’ That represents close to a third of all Americans who were protected from losing their health insurance for the past three years. However, Senate majority leader Chuck Schumer, then-House Speaker Nancy Pelosi, and President Biden decided to do the inexplicable [No, it’s not] just in time for the holidays: They put a measure into the bill to delink the continuous enrollment provision in Medicaid from the public health emergency and end it as of March 31, 2023. According to Kaiser, ‘between 5 million and 14 million people will lose Medicaid coverage once the continuous enrollment provision ends.’ But the Democrats weren’t finished. On Monday, the White House announced that it will let the Covid-related public health emergency declarations expire on May 11, 2023… [T]he numbers don’t lie. As Alyssa Bilinski and Kathryn Thompson from the Brown School of Public Health, along with Ezekiel Emanuel from the University of Pennsylvania’s Perelman School of Medicine, wrote in a letter to the Journal of the American Medical Association in November: ‘The US continued to experience significantly higher Covid-19 and excess all-cause mortality compared with peer countries during 2021 and early 2022, a difference accounting for 150,000 to 470,000 deaths.’ Last week, more people died of Covid than perished in the Twin Towers on 9/11.” • Once you accept that the Democrat policy is mass infection without mitigation, these decisions are not “inexplicable” at all. They’re not bugs. They’re features. Features that make Pfizer very happy!


“Hunter Biden converted Delaware house with classified documents into home office”

[New York Post, via Naked Capitalism Water Cooler 1-31-2023]

“Hunter Biden apparently turned his father’s Wilmington, Del. mansion into a high-powered and possibly compromised home office, wheeling and dealing with some of the same nations whose names have turned up in classified documents recently discovered at the home, according to experts and leaked cellphone texts. Hunter Biden listed the idyllic Wilmington home as his address following his 2017 divorce from ex-wife Kathleen Buhle — even claiming he owned the three-bed, four-and-a-half-bath lakefront property on a July 2018 background check form as part of a rental application. The home is also listed as his billing address for a personal credit card and Apple account in 2018 and 2019. At least 12 classified documents — some dating back to President Biden’s career in the Senate — were found on its premises in recent weeks. Some of the classified material found at the home, as well as the roughly 10 items of classified pages found at the Penn Biden Center, related to nations Hunter Biden had extensive business entanglements in — such as Ukraine.”


(anti)Republican Party

“Inside the GOP’s “Save the kids” strategy”

[Axios, via Naked Capitalism Water Cooler 2-2-2023]

“The fractious Republican Party is consolidating around a ‘Protect the children’ platform for 2024 that aggressively targets school policies on gender identity and how racial issues are taught. A year before presidential primaries begin, Republicans see this as a winning formula that can fire up their base and attract some independents, pointing to the recent electoral success of Florida Gov. Ron DeSantis and Virginia Gov. Glenn Youngkin. Much of the battle is being fought at the state and local levels, giving an edge to GOP officials such as DeSantis and Youngkin — both potential presidential candidates who recognized the potency of educational issues early on.”


“The press versus the president, part one”

Jeff Gerth  [Columbia Journalism Review (and twothree, and four), via Naked Capitalism Water Cooler 2-2-2023]  

[Lambert Strether writes: “I’m still reeling from this. Within 24 hours after Mueller goes down in flames before Congress — and the very expectant press — Trump picks up the phone and makes a call to get dirt on Joe Biden* — from a CIA asset: Volodymyr Zelenskyy. I’m sure the Big Z couldn’t believe his good luck, and immediately sold Trump to his handlers. In so many ways, Trump comes across as… well, as a little child. An innocent in a world of malevolent grownups (which, given Fred, was certainly true, at least for a short time in Trump’s life). If you have the time to sit down with this, it’s really worth it, just to get the incredibly grotty timeline straight.]

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