Discretionary Spending 2016


Naked Capitalism on Government Corruption


The Augean Stables – How Corruption Has Amended the Constitution

By Gaius Publius, a professional writer living on the West Coast of the United States and frequent contributor to DownWithTyranny, digby, Truthout, and Naked Capitalism. Follow him on Twitter @Gaius_Publius, Tumblr and Facebook. This piece first appeared at Down With Tyranny. GP article archive here.
Not something you don’t already know if you’re a regular reader of these pages, but it’s becoming more and more mainstream to deliver a radical* analysis of government in the U.S. That’s why I found the following so interesting — the source is former U.S. Senator and former presidential candidate Gary Hart. And believe me, this is a radical analysis.

But first, two definitions. The Augean Stables is a reference to the Fifth Labor of Hercules, one of the Twelve (click to read the context). The task was to clean the king’s stables, which housed 1,000 cattle and which hadn’t been cleaned in 30 years, the life of the man who owned it. Cleaned of what? Surely you know:

The fifth Labour of Heracles (Hercules in Latin) was to clean the Augean (/ɔːˈən/) stables. Eurystheus [the king assigning the tasks to Hercules] intended this assignment both as humiliating (rather than impressive, like the previous labours) and as impossible, since the livestock were divinely healthy (immortal) and therefore produced an enormous quantity of dung (ἡ ὄνθος). These stables had not been cleaned in over 30 years, and over 1,000 cattle lived there. However, Heracles succeeded by rerouting the rivers Alpheus and Peneus to wash out the filth.

The second definition — corruption. Most think of corruption as an outcome that’s perverted for the sake of money. Hart, correctly, says, Not so:

From Plato and Aristotle forward, corruption was meant to describe actions and decisions that put a narrow, special, or personal interest ahead of the interest of the public or commonwealth. Corruption did not have to stoop to money under the table, vote buying, or even renting out the Lincoln bedroom. In the governing of a republic, corruption was self-interest placed above the interest of all—the public interest.

Corruption is “self-interest placed above the interest of all,” or in some cases, one’s legal or contractual obligation. Thus, for example, some college football referees and refereeing groups are obviously corrupt. When Conference A plays Conference B using Conference B’s referees, and year after year the bad calls go Conference B’s way, especially with the game on the line, the referees are corrupt.

Are they betraying their obligation for money? No, likely not. Are they betraying their obligation in order to satisfy animus against Conference A, or to make sure the “home teams” win? That’s an obvious explanation, and by this definition (and mine), that’s corrupt.

Or take another situation. By this definition, the Supreme Court since at least 2000 and likely before has acted corruptly, if the definition is “self-interest placed above the interest of all.” No legal analysis of Bush v. Gore passes the “upholds the interest of all” test — the Republicans on the Court simply put a Republican (the home team candidate) in the White House because they could. Nor do the major decisions around money and corporate rights, like Citizens United or even Buckley v. Valeo, the 1976 Burger Court decision that lifted restrictions on campaign contributions, and its follow-up, First National Bank of Boston vs. Bellotti, whose majority opinion was authored by Lewis Powell, of the infamous Powell memo.

By this definition — perverting an outcome to benefit a group in which one has a personal interest — the Supreme Court acted corruptly in the cases above. Likely corrupt in Buckley, Citizens United, and First National Bank of Boston. Certainly corrupt in Bush v. Gore, where Republican justices favored a Republican candidate for president over a Democratic one on no defensible grounds. They weren’t metaphorically “corrupt,” with the quotes. They were corrupt by definition.

Gary Hart on the Systemic Corruption of the U.S. Government

Hart’s piece is an interesting Time magazine essay, and also a long section from his new book, The Republic of Conscience (I don’t support Amazon, so no Amazon link). I don’t want to quote a ton of it, since its main argument is likely familiar to you. But he makes a systemic point in a way that seems original; that is, he puts pieces together to make a bigger whole than most of us were aware of. For example, it’s likely that the “army of lobbyists” we all hate aren’t a perversion of government — they are government.

A few notable sections (all emphasis mine):

Gary Hart: America’s Founding Principles Are in Danger of Corruption

Welcome to the age of vanity politics and campaigns-for-hire. What would our founders make of this nightmare?

Four qualities have distinguished republican government from ancient Athens forward: the sovereignty of the people; a sense of the common good; government dedicated to the commonwealth; and resistance to corruption. Measured against the standards established for republics from ancient times, the American Republic is massively corrupt.

From Plato and Aristotle forward, corruption was meant to describe actions and decisions that put a narrow, special, or personal interest ahead of the interest of the public or commonwealth. Corruption did not have to stoop to money under the table, vote buying, or even renting out the Lincoln bedroom. In the governing of a republic, corruption was self-interest placed above the interest of all—the public interest.

By that standard, can anyone seriously doubt that our republic, our government, is corrupt? There have been Teapot Domes and financial scandals of one kind or another throughout our nation’s history. There has never been a time, however, when the government of the United States was so perversely and systematically dedicated to special interests, earmarks, side deals, log-rolling, vote-trading, and sweetheart deals of one kind or another.

What brought us to this? A sinister system combining staggering campaign costs, political contributions, political action committees, special interest payments for access, and, most of all, the rise of the lobbying class.

Worst of all, the army of lobbyists that started relatively small in the mid-twentieth century has now grown to big battalions of law firms and lobbying firms of the right, left, and an amalgam of both. And that gargantuan, if not reptilian, industry now takes on board former members of the House and the Senate and their personal and committee staffs. And they are all getting fabulously rich.

Gargantuan numbers of lobbyists with gargantuan amounts of money. There’s a point where corruption of government on that scale systemically changes government itself.

The “Big Three” Lobbying Conglomerates Are a “Fourth Branch of Government”

For Hart, the movement of office-holders and their staffs between lobbying firms and government is not a “revolving door” to government; that revolving door is government. Hart makes his point by looking at the lobbying firm WPP, the largest of three giant lobbying conglomerates. WPP isn’t just a lobbying firm, it’s an international conglomerate of firms that wields enormous power and wealth.

Consider — WPP has been eating up lobbying firms the way Macy’s, Inc. eats department stores or Darden eats restaurant chains. At some point, you simply own the business you’re in, and the size of your operation changes the nature of the game itself.

Hart on how lobbying at this scale changes our government:

[T]he largest [lobbying “predator” (his term)] by far is WPP (originally called Wire and Plastic Products; is there a metaphor here?), which has its headquarters in London and more than 150,000 employees in 2,500 offices spread around 107 countries. It, together with one or two conglomerating competitors, represents a fourth branch of government, vacuuming up former senators and House members and their spouses and families, key committee staff, former senior administration officials of both parties and several administrations, and ambassadors, diplomats, and retired senior military officers.

WPP has swallowed giant public relations, advertising, and lobbying outfits such as Hill & Knowlton and BursonMarsteller, along with dozens of smaller members of the highly lucrative special interest and influence-manipulation world. Close behind WPP is the Orwellian-named Omnicom Group and another converger vaguely called the Interpublic Group of Companies. According to Mr. Edsall, WPP had billings last year of $72.3 billion, larger than the budgets of quite a number of countries.

With a budget so astronomical, think how much good WPP can do in the campaign finance arena, especially since the Citizens United decision. The possibilities are almost limitless. Why pay for a senator or congresswoman here or there when you can buy an entire committee? Think of the banks that can be bailed out, the range of elaborate weapons systems that can be sold to the government, the protection from congressional scrutiny that can be paid for, the economic policies that can be manipulated.

The lobbying business is no longer about votes up or down on particular measures that may emerge in Congress or policies made in the White House. It is about setting agendas, deciding what should and should not be brought up for hearings and legislation. We have gone way beyond mere vote buying now. The converging Influence World represents nothing less than an unofficial but enormously powerful fourth branch of government.

To whom is this branch of government accountable? Who sets the agenda for its rising army of influence marketers? How easy will it be to not only go from office to a lucrative lobbying job but, more important, from lucrative lobbying job to holding office?

When one lobbying firm has billings of nearly $75 billion, you can “buy committees,” not just individual votes; and you can “set agendas” rather than just pass laws.

Now consider that “revolving door” again. Is that a door out of government and back into it, or is it a door into another branch of government, one where policy decisions also get made?

Does an International Lobbying Firm Serve One Nation’s Interest or Many?

And a final question: If the lobbying firm is international, with international clients and governmental “targets,” are its interests “American” in any way? If not, how compromised are those who take its money?

Where are its [WPP’s] loyalties if it is manipulating and influencing governments around the world? Other than as a trough of money of gigantic proportions, how does it view the government of the United States?

Why would not WPP act to modify the laws of one country to serve the interests of clients in another? And I’ll ask again, are those who take its money compromised by the international goals of these mega-firms?

“Purchasing” Candidates and Office-Holders — Even Former Senators Are Saying It

Just as “corruption” is not a metaphor when it comes to decisions like Bush v. Gore, “buying” and “sponsoring” candidates and office-holders — the way soap is bought and race cars are sponsored — is not a metaphor, at least according to Hart:

The advent of legalized corruption launched by the Supreme Court empowers the superrich to fund their own presidential and congressional campaigns as pet projects, to foster pet policies, and to represent pet political enclaves. You have a billion, or even several hundred million, then purchase a candidate from the endless reserve bench of minor politicians and make him or her a star, a mouthpiece for any cause or purpose however questionable, and that candidate will mouth your script in endless political debates and through as many television spots as you are willing to pay for. All legal now. …

The five prevailing Supreme Court justices, holding that a legal entity called a corporation has First Amendment rights of free speech, might at least have required the bought-and-paid-for candidates to wear sponsor labels on their suits as stock-car drivers do. Though, for the time being, sponsored candidates will not be openly promoted by Exxon-Mobil or the Stardust Resort and Casino but by phony “committees for good government” smokescreens.

I think he’s literally correct. In the old days, it didn’t take much money to wholly own a back-bench Congress person from coal country, say, and one coal company, if big enough, could do it. But the major office-holders had to be funded by competing interests. Now you can tag several  presidential candidates, at least on the Republican side, with the single name of their “benefactor.”

For example:

  • Marco Rubio — Sponsored by Norman Braman & (he hopes) Sheldon Adelson
  • Scott Walker — Sponsored by the Koch Brothers
  • Ted Cruz — Sponsored by hedge fund billionaire Robert Mercer
  • Rick Santorum — Sponsored by Foster Friess
  • Rand Paul — Sponsored by [this slot available]

And so on. Joe Biden’s been called the “Senator from MBNA,” and Chuck Schumer the “Senator from Wall Street.” Seems right. In cases of such complete “sponsorship” I agree that wearing of badges should be required. Partial sponsorship could be handled like NASCAR jackets.


But this treats a serious problem too lightly. Remember, I said this was a radical analysis. In fact, by this practice we’re actually amending the Constitution — not the one as written; the one as practiced.

The Other Way to Amend the Constitution

All constitutions and all systems of laws are amended in two ways, by formal agreement (legal process) and by informal agreement. In England, the second ways is in fact the primary way their “constitution” is amended.

In the U.S., if both parties enforce a law in the same way, even though that way deviates from the way the law is written, the law is amended until forced back to its original form in practice. Thus:

▪ We have, by bipartisan agreement, revoked the Fourth Amendment. Neither party enforces it, so it’s gone. Do you think you’ll see it enforced in your lifetime? It’s possible. Is that likely, do you think, without another radical change?

▪ We have changed the “rule of law” to add a “circle of immunity” amendment. It started with Nixon — the circle of “who cannot be prosecuted” included one person, the president. That was granted him by Gerald Ford’s pardon with no objection from Congress and confirmed by Obama’s refusal to indict Bush II for violating laws against torture. (Can you see Obama being indicted by anyone for extrajudicial murder, assassination really, of Americans, some mere propagandists and some completely innocent?)

Under Reagan–Bush I that circle expanded to include their top cabinet officers, like Defense Secretary Casper Weinberger. Under Bush II–Obama it includes all money-center bankers and former senators (and outright crooks) like Jon Corzine.

▪ Regarding that parenthetical comment about Obama and his drone kills above, we’ve now amended the trial-by-jury section of the Sixth Amendment to allow executive assassination, death by executive fiat. It just awaits a Republican president to confirm it by following suit, but Congress has already approved.

And so on. Now we can add one more:

▪ The mega-lobbying firms, with their combined more-than-$100 billion annual budget, are a fourth branch of government. Policy is set in these firms and passed to Congress and the executive branch to “discuss.” Once discussed and passed, those who passed these policies then return to the firms to set more policy — and receive what’s often the biggest payoff of their lifetime.

Was TPP drafted first in these mega-firms before being negotiated between nations? There aren’t many other ways to convene 600 lobbyists (pdf).

Cleaning the Augean Stables

Back to Hart’s essay and where we started, with the Augean Stables. The way out of this mess, if Greek myth is any indicator, is not incremental. You can’t shovel your way out. Remember, that’s a 1,000-cattle stable, and in our case a literal army of lobbyists. With a mere shovel, we’d be buried to our necks before the fourth toss of filth out the window.

How did Hercules clean his stable? He diverted a river and ran the whole mess out to sea in one pass. There’s a word for that equivalent in government life — radical change, and it comes in several forms.

I recommend the peaceful kind, like backing this guy for president. Click to support; you can adjust the split at the link.

*Did you know that “radical” means “going to the root or source”?

Radically yours,


What the Pope Said



Encyclical Letter

Humor: The Borowitz Report

Poll: Palin Would Bring Much-Needed Dignity to Republican Field


Credit Photograph by Scott Olson/Getty

WASHINGTON (The Borowitz Report)—The former Alaska Governor Sarah Palin would bring much-needed dignity to the 2016 Republican field, a new poll shows.

According to the poll, conducted by the University of Minnesota’s Opinion Research Institute, Palin’s ability to articulate her positions on issues with precision and restraint is sorely lacking among other entrants in the G.O.P. race.

Additionally, voters said that the former governor’s breadth of knowledge in the fields of economics, foreign affairs, and American history would place her head and shoulders above the current crop of Republican hopefuls.

In the words of one voter who was surveyed, “When I hear some of these candidates talk, I sure do miss Sarah Palin.”

Despite the overwhelming sense that she would contribute gravitas and intellectual rigor that have been woefully missing from the G.O.P. contest, a Palin candidacy appears unlikely, a spokesman said.

“Governor Palin is very flattered by this poll, but she is concerned that being associated with this field of candidates could harm her stature,” he said.

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Counterpunch on Greece & Class Warfare


Greece and Global Class War

By 2008 the neoliberal project that had been propelled by bullshit, wishful thinking and copious quantities of bank money freed from any pretense that it could ever be repaid was coming unwound. The same ‘favor’ that American mortgage lenders had done communities of color and exurbs in the U.S. found peripheral Europe’s political ‘leaders’ and plutocrats ready, willing and able to borrow money that stood little chance of being repaid by them. As soon as it became publicly evident that trillions in bank loans were unlikely to be repaid bankers, and the government officials who work for them, looked around to see what groups were (1) able to pay interest, and eventually principal, on debt that they had seen no direct benefit from, and (2) lacked the political power to resist being forced to repay it.

Lest this seem too diabolical to be plausible, this is the basic lending model that has been used by Western banks and backed by Western governments and the ‘independent’ institutions they control for some six decades now. The U.S., Germany or France have long lent money for infrastructure projects, agricultural ‘upgrades’ like the Green Revolution and direct purchases of technology and / or munitions. This indebted the citizens-by-degree of both internally and externally organized nation-states while making large profits for the corporations who could sell their wares thanks to the ‘largesse’ of Western states and banks. This practice in some measure explains how corrupt and / or incompetent government officials and plutocrats in Greece managed to line their own pockets while permanently indebting the good citizens of that storied nation.

From a creditor’s perspective pools of wealth like pensions, bank deposits and health care funds tend to be fungible and therefore ripe for the picking. That ordinary citizens in many cases labored their entire lives and forewent direct compensation in exchange for these benefits has had little to no bearing on their being taken to settle debts incurred by others. Lest these seem wildly primitive, backwater type acts, the current battle over public and private pensions in the U.S. is precisely and exactly this. And while the Federal government backs the FDIC (Federal Deposit Insurance Corporation) limited guarantee of bank deposits in the U.S., bipartisan ‘Grand Bargains’ and newly negotiated details of coming bank bailouts suggest that bank deposits may be about as ‘sacred’ as Social Security and public sector pensions in the next crisis.

The most corrupt large-scale bank bailouts were engineered in the U.S. by Democrat President Barack Obama and his Lieutenants Timothy Geithner and Larry Summers following from (George W.) Bush administration efforts. The decision was made early on to fully restore Wall Street while leaving the major players who had destroyed the global ‘real’ economy in place. The European powers-that-be replaced key players and imposed more onerous restrictions than had the Americans. This differentiated treatment between ‘internal’ lenders and ‘external’ borrowers defined state behavior both within and across Western nations. The difference in part confirms the perceived importance that Wall Street, large American, French and German based banks, play in neo-imperialist endeavors.


In this time when liberatory politics are handed down by the Supreme Court and liberal Democrat Barack Obama is pushing stealth ‘trade’ deals through Congress the rule of money couldn’t be more evident. Evolution of the Reagan / Thatcher ‘liberation through markets’ finds a global corporate class preying on neo-imperial subjects through newly-constructed mechanisms of economic subjugation. This self-realizing professional class now has the same right to sleep in cardboard boxes and beg for money as the economically excluded, the privatized and those held captive by markets. Self-realized German politicians join self-realized Greek pensioners enjoying ethereal rights while engaged in global class war.

Global reach ties for-profit policing and racial repression in Ferguson, Missouri to captive markets and perpetual debt in Athens, Greece. It is hardly incidental that Germans are raising racist caricatures of ‘lazy, spendthrift’ Greeks much as the narrative of ‘personal responsibility’ defines the exclusionary / inclusionary class basis for racist mass incarceration and predatory privatization schemes in the U.S. This is the language used to ‘explain’ the imperial domination that defined the West for much of the 18th, 19th and 20th centuries now updated for a modern audience. Culture war gimmes that conflate expansion of conservative institutions like marriage and military service with liberatory politics are used to divert attention from the rapid consolidation of totalizing economic and political power.

The evolutionary process of late-stage debt servitude is largely formulaic. An early-stage analog is the ‘emerging market’ loans made by large American banks in the 1970s and 1980s that were promptly redeposited into the same banks in the names of corrupt foreign officials but repayable by ‘their’ citizens. Step two is insertion of ‘helpful’ Western institutions like the IMF (International Monetary Fund) and World Bank to induce debtor countries to open markets to multi-national monopolists, to eliminate local economic competition, to offer up local resources to be looted, to assign ownership of key industries and utilities to external agents and to use austerity policies to delineate local agents for international capital from neo-imperial subjects. Racist / imperialist apologetics provide socially divisive rationales for engineered economic divisions.

Current mainstream discussion of ‘negotiations’ between a credible Greek government and the Troika (IMF, ECB (European Central Bank) and the EU (European Union)) focus on Greek machinations while it is the Greeks who have limited options and the Troika who could make their neo-imperialist terms disappear in a few heartbeats. The alleged political constraints of the Troika— constituencies that it must answer to, are largely the product of contrived racist chatter used to rally them around its neo-imperial project. In history, the Nazi Occupation of Greece created moral and factual debts owed to the Greek people that couldn’t be repaid in several epochs. This history includes tens, if not hundreds, of thousands of Greeks starved to death to feed the German people and their armies, and tens, if not hundreds, of thousands of Greeks publicly hung, shot or executed in ‘death vans.’

Greek circumstance was recently couched in a plea by Greek Finance Minister Yanis Varoufakis that the Troika help Syriza reorganize Greek governance to force local plutocrats to disgorge their ill-gotten gains for the benefit of the Greek people. The class interest frame that Mr. Varoufakis used (by metaphor) links the evolution of clearly odious debt from French and German banks to its renegotiation in 2010. Recently released conversations between German ‘negotiators’ suggest that it was well-understood in 2010 that the amount of debt was too large to be repaid and that the terms were economically destructive to Greece. What might seem inexplicable in national terms— the inability of the Greek government to bring its plutocrats to heel, finds its likeness in American rule over recent decades.

This last point is important to understand— the contention that Americans could force American plutocrats to act in the national interest rather than their own is contradicted by the history of the last half-century. The American War in Southeast Asia made war profiteers rich while it was known to be a lost cause for the last decade of its undertaking. The sequential wars across the Middle East were sold in the national interest while securing oil for multi-national oil and gas companies was the predominant goal. Wall Street was deregulated and allowed to make predatory loans that cost millions of people their homes and life savings. When Wall Street imploded from its own malfeasance its victims were made to restore it. Should this fail to convince, poll results eternally show plutocrat’s interests determining government policies against those of the overwhelming majority of citizens.

Mr. Varoufakis’ plea, capitulation to 98% of the detrimental economic policies foisted on Greece by the Troika in exchange for small, economically reasoned, forbearance on Greek pensions, employment and regressive taxes, pitted policy imagination against the long history and short memory of German ‘negotiators’ who seem intent on seeing Germany re-occupy Greece through punishing economic policies and the forced sale of Greek state assets. Giving the game away are the policies being imposed— neoliberalism as economic imperialism dressed in academic garb. Whether one wants to assign malevolent intent, stupidity, ignorance and / or starry-eyed ideological blindness, the genesis of Greece’s debt suggests that Mr. Varoufakis’ identification of a global ruling class in its creation appears to be on target.

The tactic of the Troika in obfuscating this genesis places the 2010 ‘bailout’ at its center. By shifting Greek liabilities from ‘private’ bank balance sheets to the Troika (at a discount) unpayable debts were tied to wholly implausible economics to pretend that a mutually beneficial agreement had been reached. Paradox lies at the intersection of the agreed upon terms and democratic accountability. It’s all well and good that Greek elites came to terms that the citizens of Greece were intended to bear, even if at the barrel of a metaphorical gun. But where is French and German banker culpability in making loans that could under no arrangement of circumstance be repaid? By analogy, by 2007 American mortgage bankers knew that a large proportion of the loans they were making could never be repaid. To cover up this malfeasance President Obama and his Treasury Secretary, Timothy Geithner, created multi-layered bailout programs to shift resources to culpable banks and bankers. And in cases where that didn’t work, bank liabilities were shifted directly onto the public balance sheet.

The central difference between the U.S. and Greece, besides position in neo-imperial hierarchy, is that the U.S. has no constraint on the creation of U.S. dollars to replace those wasted by bankers. Hundreds of billions, if not trillions, of dollars of bad bank loans were buried in Federal government agencies in the U.S. A Greek choice to leave the European Monetary Union would consign it to a tertiary currency, the Drachma, and a very disorderly unwind, or to continue using the Euro as an ‘external’ currency that it lacks the power to create. To stay within the currency union leaves currency creation in the hands of the ECB which views the union as a quasi-gold standard except when it comes to salvaging predatory European banks. That the Greek ‘problem,’ at least a far as the Troika is nominally concerned, could be resolved through money creation by the ECB points to the political (imperialist) nature of Troika policies.

Present circumstance has a referendum scheduled by Syriza for Sunday, July 5, to vote on the bailout package already rejected, and then partially accepted by Syriza. Capital controls have been instituted and bank withdrawals are severely limited causing immediate and severe economic pain. Not only are Greek citizens being individually affected, the set of economic relationships that is required for economic production to take place (supply chain) has been interrupted and is at risk of being lost. The tradeoff at present appears to be acceptance of Troika terms, either by Syriza or the government that follows it, and continued economic misery or immediate and severe economic dislocations with a plan of gradual recovery. The only assurance is that continued accedence to Troika policies will mean perpetual economic misery for the Greek people.

The prevailing wisdom appears to be that Syriza blew an opportunity to gain slight concessions from the Troika by being inconsistent. By calling for the referendum after capital controls have been implemented the question Syriza appears to be putting to the Greek people is whether they will accept severe near-term economic pain in exchange for possible bargaining leverage. The argument that Syriza wasted good will assumes that, the last eight years notwithstanding, the flawed structure of the monetary union was unforeseen and that Troika negotiations were ever other than naked power politics put forward for economic gain and political domination. Motivations may be complex, but present circumstance carries with it the aggregation of stated and hidden intentions. History now finds Germany playing the role of occupying force, only without the actual occupation, complete with racist caricatures that harken back to the early 1940s.

Regardless of how cleverly or poorly Syriza has ‘played’ its position, Yanis Varoufakis’ identification of a global ruling class, not as singular, unified interests, but as an artifact of the predominant political economy of the epoch, takes the issues at stake out of the narrow Troika- Greek frame to place them in global class struggle. The center – periphery frame that has been used to define European political and economic relations finds metaphor in class relations in the U.S. While economic recovery has been claimed since the middle of 2009, it has largely emanated from an extremely concentrated core— from Wall Street and the executives of large, multi-national corporations to select suburban bourgeois, bypassing traditional ‘out’ groups. The economic detritus from predatory finance can still be seen in the inner city and exurb communities where bank malfeasance was most prevalent. That a liberal Democrat President has implemented ‘trickle-down’ policies demonstrates the reach of the neoliberal project.

While in some cosmic accounting unknown and unknowable to us mere mortals ordinary Greeks may have spent weeks in the early – mid 2000s walking quickly past the needy and buying bourgeois trinkets just to prove they could, the current circumstance of Greece is more systemic than particular. French and German banks made the same predatory loans across the European periphery. Stupidity, ignorance and / or ideological blindness may explain as much or more than malevolence, but expertise in assessing the capacity to repay loans is the business of bankers, not borrowers. The failure of ‘center’ governments to hold malevolent and / or incompetent bankers to account while forcing the consequences of their poor business decisions onto those least able to resist them ties the ‘excesses’ of the 1990s and 2000s to the prior half-century of predatory banking in the service of neo-imperial conquest.

In this frame it doesn’t all that much matter what Syriza did or didn’t do— the game was rigged from the start. As far as reflecting poorly on an international left, if one modeled the distribution of political and economic power before and after Syriza little movement in one direction or another would likely be seen. If the idea of the left is to provide a critical frame and broad principles for social— political and economic, organization then leaving Syriza and the Greek people to their own devices hardly seems constructive. If this analysis has bearing, the people of Baltimore, Detroit and Philadelphia share more interests with the Greek people than they do with the local representatives of international capital in Washington and New York. The unifying factor is neo-imperialist political economy put forward in the realms of the political and the economic as freedom to choose.


Unless economic recovery is but the blind hope that history has ended, renewed crisis well-fits the historical tendencies that were recovered and enhanced since the last crisis. That Greece, and more likely than not the rest of the European periphery, is in decline in approximate proportion to the extent it was peripheral in the first place, signals the conundrum some time ago entered into by Greek politicians now long out of office. As of this writing, the IMF has publicly stated that Greek debt is unpayable in its current amount. From recently released conversations among senior German negotiators, this was well-understood before the 2010 ‘agreement’ between Greece and the Troika was signed. And at the wholesale and retail levels Wall Street, large American, French and German banks, knew that many of the loans being made, couldn’t, and therefore wouldn’t, be repaid.

For those who may have forgotten, at the height of the financial unpleasantness in 2008 the IMF made a public mea culpa begging forgiveness for decades of denying the very same plutocrat-serving bailout policies that were the first choice of Western policy officials. This is to suggest that just because all parties involved in Greek ‘negotiations’ know, and have long known, that Greek debts can’t be repaid has had no bearing up-to-now on the punishing policies forced on the Greek people. Debt is the tool of modern imperialism. Had the U.S. and Germany extended the same bailout terms to the domestic and global periphery that were applied to ‘home’ banks the global economic crisis would have ended in 2009. The difference can be framed in terms of economic class or imperialist center-and-periphery. Either way, history is the better guide than mainstream economic theory to determining the trajectory of the political economy that now confronts us all by degree.

Rob Urie is an artist and political economist.

Tom Toles cartoon: Donald Trump crosses the border – The Washington Post

Greg Palast on the Greek Tragedy


GREECE’d: We Voted ‘No’ to Slavery, But ‘Yes’ to Our Chains

By Michael Nevradakis, host of Dialogos Radio in Athens with Greg Palast in New York. Originally published at Op-Ed News

We Greeks have voted ‘No’ to slavery – but ‘Yes’ to our chains.

Not surprisingly, by nearly two-to-one, Greeks have overwhelmingly rejected the cruel, economically bonkers “austerity” program required by the European Central Bank in return for an ECB loan to pay Greece’s creditors. In doing so, the Greek people overcame an unprecedented campaign of fear from the Greek and international media, the European Union (EU), and most of our political parties.

What’s simply whack-o is that, while voting “No” to austerity, many Greeks wish to remain shackled to the euro, the very cause of our miseries.

Resistance, not Crisis

Before we explain how the euro is the cause of this horror show, let’s clear up one thing right away. All week, worldwide media was filled with news of the Greek “crisis.” Yes, the economy stinks, with one in four Greeks unemployed. But two other euro nations, Spain and Cyprus, also are suffering this depression level of unemployment. Indeed, more than 11% of workers in seven euro nations, including Portugal and Italy, are out of work.

But unlike Greece, these other suffering nations have quietly acquiesced to their “austerity” punishments. Spaniards now accept that they are fated forevermore to be low-paid servants to beer-barfing British tourists. Spanish prime minister Mariano Rajoy, who has enacted a draconian protest ban at home to keep his own suffering masses at bay, has joined in the jackal-pack rejecting anything but the harshest of austerity terms for Greece.

The difference between these quiescent nations and Greece is that the Greeks won’t take it anymore.

What the media call the Greek “crisis” is, in fact, resistance.

Resistance to Nowhere

But it’s a resistance whose leaders are leading them nowhere.

For decades, Greeks have suffered governments that are both corrupt and dishonest.

The election of SYRIZA changed all that: the government is now merely dishonest. Our new SYRIZA Prime Minister, Alexis Tsipras, correctly called the austerity plan “blackmail.” However, before Sunday’s vote, Tsipras told the nation a big fat fib. He said we could vote down the European Bank’s plan but keep the European Bank’s coin, the euro. How? Tsipras won’t say; it’s part of a policy ploy his outgoing finance minister Yanis Varoufakis calls “creative ambiguity.” To translate: Creative ambiguity is Greek for “bullshit.”

Sorry, Alexis, if you want to use the Reich’s coin you have to accept the Reichsdiktat.

Not a Coin, a Virus

Tsipras’ claim that Greece can keep the euro while rejecting austerity is crazy-talk. The fact is that German Chancellor Angela Merkel, the Cruella De Vil of the Eurozone, will ignore the cries of the bleeding Greeks and demand we swallow austerity––or lose the euro.

But, so what if we lose the euro? The best thing that can happen to Greece, and should have happened long, long ago, is that Greece flee the Eurozone.

That’s because it is the euro itself that is the virus responsible for Greece’s economic ills.

Indeed, the sadistic commitment to “austerity” was minted into the coin’s very metal. We’re not guessing. One of us (Palast, an economist by training) has had long talks with the acknowledged “father” of the euro, Professor Robert Mundell. It’s important to mention the other little bastard spawned by the late Prof. Mundell: “supply-side” economics, otherwise known as “Reaganomics,” “Thatcherism” – or, simply “voodoo” economics.

The imposition of the euro had one true goal: To end the European welfare state.

For Mundell and the politicians who seized on his currency concept, the euro itself would be the vector infecting the European body politic with supply-side Reaganomics. Mundell saw a euro’d Europe as free of trade unions and government regulations; a Europe in which the votes of parliaments were meaningless. Each Eurozone nation, unable to control neither the value of its own currency, nor its own budget, nor its own fiscal policy, could only compete for business by slashing regulations and taxes. Mundell said, “[The euro] puts monetary policy out of the reach of politicians… Without fiscal policy, the only way nations can keep jobs is by the competitive reduction of rules on business.”

Here’s how it works. To join the Eurozone, nations must agree to keep their deficits to no more than 3% of GDP and total debt to no more than 60% of GDP. In a recession, that’s plain insane. By contrast, President Obama pulled the USA out of recession by increasing deficit spending to a staggering 9.8% of GDP, and he raised the nation’s debt to 101% from a pre-recession 62%. Republicans screamed, but it worked. The US has lower unemployment than any Eurozone nation.

As Obama scolded the European tormentors of Greece: “You cannot keep on squeezing countries that are in the midst of depression.” Cutting spending power only leads to less spending which leads to further cuts in spending power – a death spiral we see today in the Eurozone from Greece to Italy to Spain—but not in Germany.

“Not in Germany.” There’s the rub. Normally, a nation such as Greece can quickly recover from debt-induced recession by devaluing its currency. Greece would become a dirt cheap tourist destination once more and its lower-cost exports would zoom, instantly increasing competitiveness. And that’s what Germany can’t allow. Germany lured other European nations into the euro in order to keep them from undercutting Germany’s prices in export markets.

Restricted by the 3% deficit rule, the only recourse left for Eurozone debtors: pay the piper with “austerity” measures.

Tsipras in Wonderland

So therein lies the lie. Tsipras tells his fellow Greeks that we can live in a Looking Glass world, where we can have our euro and eat it too; that we can stay handcuffed to the euro but run free without austerity.

The nonsense continues: Following the announcement of the official results of the referendum on Sunday night, Tsipras tweeted that the Greek electorate voted for a “Europe of solidarity and democracy,” while the now-resigned finance minister Varoufakis tweeted that “Greece’s place in the Eurozone is non-negotiable,” claiming that he would not allow the “only alternative,” the old drachma trading alongside the euro.

SYRIZA’s euro-fetish was already evident in its pre-referendum proposals to the IMF and European Bank, a 47-page document which included 8 billion euros in new austerity measures plus a new round of sell-offs of state industries, the maintenance of a primary surplus of 1% this year which would increase in the coming years, the increase of the retirement age to 67, and making permanent the previously “temporary” taxes upon an already overtaxed populace. In Tsipras’ own proposal, there was no word of a debt write-down or stoppage of payments, despite the fact that the government’s own Debt Audit Commission announced on June 17 that the bulk of Greece’s debt is illegal, “odious,” and should not be paid.

Instead, Tsipras has come out in support of the IMF’s proposal for a mere 30% “debt haircut” and a 20-year grace period, effectively sweeping the problem under the rug. Greece is currently running a deficit, meaning that in order for the 1% surplus to be achieved, SYRIZA must cut, cut, cut. Exactly as Mundell and the supply-siders intended.

Death by “Reform”

Like Obama, Tsipras knows that cutting pensions, privatizing and closing industries, slashing wages — in other words, “austerity” — or, to use the latest jargon, “reform” — is not just cruel, it’s plain stupid: it can only push a nation in recession into depression.

That’s not just theory. The Troika (the European Central Bank, IMF and European Commission) first imposed their vicious austerity measures on Greece in 2010. Greeks watched their annual salaries plummet to half of a German’s paycheck. Greece’s supposedly generous pensions have been cut eight times during the crisis, while two-thirds of pensioners live below the poverty line. Everything from Greece’s airports to harbors, the national lottery to prime publicly-owned real estatewas sold off, while schools and hospitals were shuttered.

And, for the first time since World War II, widespread starvation had returned. 500,000 children in Greece are said to be malnourished. Students fainting from hunger in frigid schools which cannot afford heating oil is now a common phenomenon.This cruel “belt tightening,” the Troika promised, would restore Greece’s economy by 2012 (and then 2013, 2014, and 2015). In reality, unemployment went from a terrible 12.5% in 2010 to a horrendous 25.6% today.

Now, the Troika demands more of the same, a continuation of this disastrous policy.

Crashing into Africa?

Meanwhile, following the referendum result which made him a hero, finance minister Varoufakis resigned. Ironically, while Varoufakis rubbed German officials the wrong way with his unorthodox style, he, too, maintained the pro-euro myth. Previous austerity measures continued under his watch. To please the mad austerity masters, he said he would “squeeze blood from a stone” to repay the IMF–which he did in May, when all remaining funds in the Greek Treasury were rounded up by presidential decree to make that month’s IMF loan payment. Varoufakis was so wedded to the euro that he claimed that Greece would be unable to print its old currency, the drachma, because we destroyed our currency printing presses when we joined the euro. In fact, the government’s banknote printing facility in Athens still operates, printing the 10-euro note.Meanwhile, our future flees. A quarter million university graduates have abandoned our nation. They have no choice: unemployment for those under 25 has hit 48.6%.

I know that many Greeks, Cypriots, Italians and Portuguese all express a visceral fear of leaving the euro. Depending on which polls one chooses to believe, anywhere from a near-majority to an overwhelming majority of Greeks wish to remain in the euro at all costs. From the hysterical statements I heard from some Greeks that, “We cannot leave Europe!”, you’d think that dropping the euro will cause Greece to break off at the Albanian border and crash into Africa.

It would be refreshing to hear political leaders say the honest economic truth: “Workers of Europe unite! You have nothing to lose but the euro–and your chains.”

The Birth of Fox News & the Rise of Right-Wing Media


This excellent piece of writing by Bruce Bartlett comes courtesy of our friends at the website “the best of the internets” (link on right). The entire piece is attached. Here’s where it all began:

In August 1987, under pressure from Ronald Reagan’s drive for deregulation, the FCC abolished the fairness doctrine. A local radio broadcaster in Sacramento, California, named Rush Limbaugh quickly recognized the opportunity this afforded. A strong conservative, he realized that he could now do an entire show consisting of nothing but controversial opinions, without the burden of offering equal time to other views. His program went national in 1988, based at WABC in New York City, which had a signal powerful enough to reach 200 miles beyond Manhattan.

Fox News

Naked Capitalism on Runaway Greed


The Bankruptcy of America’s Elites

If someone had used the word “elites” in 2006, they would have been seen as a hair-on-fire hysteric, long on conspiracy theories and short on sober understanding of How Things Work. But as the 1% and 0.1% amass more and more of total income and wealth, so too have they come to believe their interest diverge from those of the rest of us (and in a literal sense, they often do, since in too many cases, their wealth rests at least in part on predatory conduct). And now that that gap has become obvious, it has reshaped the role of the ruling class, as in the people who are in charge of the administrative apparatus of society. While some members of these top income groups play a direct role in running powerful organizations (CEOs of large an/or strategically important businesses, for instance), it also includes much less affluent individuals, like government officials and those who influence values and collective perceptions, like major publishers and public intellectuals.

Increasingly, these administrators, influencers, and top professionals seek to use their roles as an entry ticket to the top cohort. The prototype is the revolving door regulator, but there are plenty of other embodiments.

A recent example is Raj Date, who was the Deputy Director at the Consumer Financial Protection Bureau after having worked at Deutsche Bank, Capital One, and McKinsey. I’m told consumer groups were never comfortable with him; he was too slick to be seen as trustworthy. And he tried to elbow Elizabeth Warren aside and he grab the directorship of the new agency before Warren put a stop to that by throwing her weight behind Richard Cordray. Date founded Fenway Summer, a “venture investment firm focused on financial services.” It sought to compete with Promontory Group, a money and influence machine headed by former Comptroller of the Currency Gene Ludwig. Established readers may recall the prominent role that Promontory played in the Independent Foreclosure Review fiasco, in which Promontory walked away with over $600 million in fees for a job badly performed and never completed (for details, see Regulatory Looting, Promontory-Style: Botched Foreclosure Reviews Alone Generate More than Double Goldman’s Revenues per Employee, Bank of America Foreclosure Reviews: Why the OCC Overlooked “Independent” Reviewer Promontory’s Keystone Cops Act (Part VB)) and Bank of America Foreclosure Reviews: How Promontory Became a Shadow Regulator (Part VA).

Date just sold Fenway Summer to Promontory. As a well-recognized banking expert said via e-mail:

Not surprised. I read it as a failure of Fenway Summer. It was supposed to be a rival to Promontory, not bought out by it. I sure as hell wouldn’t pay for Raj’s advice.

But members of the elite like Raj manage to fail upwards, or at worst sideways. And that helps preserve the widening gap between them and everyone else.

This Real News Network interview with Robert Scheer, which is number six in a ten part series, discusses how the self-serving attitudes among the supposed leaders of our society became entrenched.

PAUL JAY, SENIOR EDITOR, TRNN: Welcome back to Reality Asserts Itself on The Real News Network. We’re continuing our discussion with Bob Scheer. Bob is a veteran U.S. journalist, currently the editor-in-chief of the Webby Award-winning online magazine Truthdig. And his whole biography you’ll find beneath the video player.

We’re just going to pick up where we were.

So here’s what I’m accusing you off, that you seem to be suggesting that there’s some rationality left in this system within the elites. And I’m not talking–of course there are some individuals that have some rational long-term view. I mean, even people like Soros has been crying about the lack of banking regulation. And there’s people in different sectors of the elites who realize this is a train wreck and about go over a cliff. But those voices are actually marginalized. Even somebody who’s got as much money as Soros within the banking and financial elite is completely marginalized. Nobody really listens to a word he says–people with power, at any rate. [1:07]


JAY: Let me finish the point.

SCHEER: They listen to Buffett.

JAY: Well, maybe. But Buffett doesn’t raise as much alarm as Soros does. But within there–they don’t even seem to be able to rule in their own interest. It would be in the interest of global capitalism to have more rational banking regulations as they introduced in the 1930s. It would be in the interest of global capitalism to deal with the threat of catastrophic climate change. It would be in the interest of any rationality not to let fossil fuel and the arms industry so dominate U.S. foreign policy, particularly in the Middle East, I mean, this fueling of a Saudi-Iranian conflict. The idea that, you know, could there be a United States without a massive military, yeah, there could, but not this United States, not this economic system, not this elite. These guys aren’t going to come around to some kind if view of we could be an equal, modest country.

SCHEER: Well, you’re absolutely right that the current configuration of power in America is irrational. We don’t have adults watching the store. And we go from one disastrous pursuit to another. I mean, there was no reason whatsoever, if we had adults watching the store, you’d go knock off Saddam Hussein in Iraq, who had nothing to do with al-Qaeda, was a force against Iran, which–you know, we backed him in his war with Iran. So the contradictions are obvious, that we don’t have adults watching the store, we don’t have rational policy.

However, I think you are not the only person that now knows that.

JAY: Oh, I’m sure lots of–I would say most ordinary people kind of know it.

SCHEER: No, I think even in those circles there’s an awareness that we’re not doing very well, and there are reminders that we’re not doing well. You know, our economy is stagnant. We’re up against some real problems in terms of our future. Income inequality is one. You don’t have to be some wild lefty liberal to see that. I mean, the whole foundation of our country was always on a stable middle class and an expanding middle class, opportunity, equal playing field. I’m not saying that was the reality, but that was always the expectation. You know. And, you know, whether it’s de Tocqueville or the founding fathers, there was always an assumption that at least for what you thought was the base population there would be this opportunity. You know. And we have been forced over the last couple of decades to recognize that no, it’s going alarmingly in a different direction.

Internationally, we know we’re not doing very well. I mean, we don’t produce a whole lot of products that everybody in the world is dying to get their hands on. The main thing that we’ve been effective on is this tech stuff, and our tech companies are the ones that are most concerned that our political model is not a good one. They’re the ones that are out there having to sell this stuff, and this stuff involves getting confidence and knowing the culture, caring about other people, winning their confidence. And that’s been endangered.

So the only thing I would–I don’t disagree with you at all as to whether our model is in trouble. It’s in trouble. I disagree with you only on whether–the number of people who know it’s in trouble.

JAY: I would say even most of them–I would probably think most of the elite know it’s in trouble. They’re just going to cash in on it, and it’s going to be someone else’s problem to do something about it.

SCHEER: Okay. You’re putting your finger on something that I feel is very critical. And I have spent my life interviewing people generally around power, in government and so forth. I’ve traveled with Nelson Rockefeller and David Rockefeller. You know, I have interviewed people who became president, from Richard Nixon, Clinton, and so forth and so on.

And if I were to try to explain, the big shift that I’ve seen is long-term as opposed to short-term, that most of the people I had interviewed in the first stage of my career, say somewhere up until 1970, were people that at least were concerned what their grandchildren might think. You know? There was either through family, inherited wealth, or going to certain schools, or there was some sense of social responsibility, you know, that you could find, that we have to leave our mark, we have to leave it a better place, we have to–and just for our place in history, that it mattered. Okay? So you could be concerned, oh, we’d better get with the civil rights movement, because otherwise we’re going to fall apart, or we’d better care about the economic condition of the rest of the world, because otherwise it will rebel, we’d better worry about the living condition of our own people here or they’ll rise up with pitchforks and toss you out.

I think what happened is we went into this madcap period of short-term greed.

JAY: And let me just–Bob wrote a book called The Great American Stickup: How Reagan Republicans and Clinton Democrats Enriched Wall Street While Mugging Main Street. And this was a kind of turning point you’re talking about.

SCHEER: Yeah, that’s really what my book is about, because you had sensible rules of the road that came out of the New Deal, and there was a recognition, because of the Great Depression, that you just can’t have this madcap, crazy, Gilded Age society. Again I overuse this concept of adults watching the store, but I remember going back to just being a kid in the Bronx, and you didn’t leave the children to run the fruit stand, ’cause they’d give everything away or they’d go off themselves and play stickball. Somebody had to be there to make sure the stuff got sold and money was paid and things. And you lost that. You got people coming out of the law schools and the business schools that were shysters. You know, they just wanted some hustle, some scam. That’s how you got into credit default swaps and collateralized debt obligations.

JAY: Yeah, but the bubbles are euphoric,–


JAY: –if you’re in on cashing in on the bubble.

SCHEER: And anybody who looked at that knew. I mean, I was interviewing people during those years, and they’d say, this is, you know, as Buffett said, financial instruments of mass destruction. You know, how could you believe in any of this stuff? How could anybody believe if you–this is what my book was about–you take all these loans and you redefine them and you talk about the risk in stupid ways and you give loans to people who can’t support it, and somehow, okay, and whether you were in Fannie Mae, Freddie Mac, or whether you were in the private sector, ’cause Fannie Mae and Freddie Mac were being traded on the stock market, you had to know that this was going to explode. They knew it. And they got the laws to change to make it legal. It should have been illegal.

You know. I mean, the Commodity Futures Modernization Act, which Bill Clinton signed off as a lame duck president in 2000, after it was already–you know, the election was over, he was now a lame duck, and he signed this bill. What was the purpose of it? It was to make all of this garbage legal. It said–I think it was Section 3 of the Commodity Futures Modernization Act–a Republican-Democratic bipartisan bill–said no existing law or regulatory agency will have jurisdiction over credit default swaps or collateralized debt obligations or any of these new financial mechanisms. Why? Because they said this is modern. We have to compete with Europe. You have to be able to do these things. We can’t let–we have to give legal certainty–Lawrence Summers, you know, secretary of the Treasury–we have to have legal certainty for these financial instruments; otherwise, they won’t be effective. Right? Legal certainty meant no one’s going to look at it, no one’s going to challenge it, no one’s going to set any standards, no existing regulatory agency or law will apply. So it was a license to steal.

JAY: Now, for people that don’t understand the concept, quickly.

SCHEER: Well, quickly, what happens is they developed all these new financial gimmicks. You know, a credit default swap was something that was an insurance policy, but it was not an insurance policy. It’s what AIG did and got into so much trouble. They said, you do these collateralized debt obligations, you take all these different loans, subprime mortgages–.

JAY: Which were invented in Baltimore, by the way.

SCHEER: Yeah, auto loans, or any of these things, and then they don’t make sense on their own and they all seem quite risky, but we’ll put them into a pool and we’ll assess their value and we’ll get these credit rating agencies that have a stake in saying, yeah, they’re all good to go because they’re going to get money from it. So there was no regulation. And then you pass a law that says you’re allowed to do this, no one will look at it carefully, no existing regulatory agency will have control. So you’ve got a license to steal. Go knock yourself out. You know? And they, selling all these loans, packaging them, and then reselling them to people over the world. Right? And we can predict, you know, get this income and so forth. And then, if it looks shaky, we’re going to give you these phony insurance policies, right, that will seem to back them up. But there’s no money behind it. It’s not like a real insurance policy. Nobody’s putting any resources.

So, suddenly, you’ve got this thing that’s going to explode, and AIG, which is supposed to be backing up the insurance, says, hey, we can’t do that; we have no money for that. So now your housing bubble has collapsed and AIG can’t support it. And it’s nothing more than the mafia doing a scam, only you have passed laws that say that’s all legal, that’s all legal.

Now, you’re absolutely right. You wouldn’t do that if you were worried about how even you would appear to your grandchildren. Okay? People looking back now know these people were crooks, whether they went to–they didn’t go to jail, ’cause they they get the law passed to make it that it’s not a crime to defraud people. It’s legal. It wipes out half of the wealth of African Americans in this country, wipes out the economic gains of the civil rights movement, ’cause they were particularly a group that was particularly victimized. It wipes out two-thirds–these are Pew Research Center figures–wipes out two-thirds of the wealth, the collected wealth over generations of Hispanics in this country because they were subject to these subprime. They lose everything when they lose their house. But the guys putting it all together, they escape with their billions. They don’t go to jail. So, yes, if what you mean by your opening statement was we don’t have solid, responsible people who even care how they will appear to their grandchildren–.

You’ve got a guy like Robert Rubin, okay? Robert Rubin was secretary of the Treasury under Bill Clinton. He had come from Goldman Sachs. He had convinced Clinton you could do all this stuff, this is all great, we’ll do all this crap. He brings in Lawrence Summers. Timothy Geithner, who’s a younger person working in there, he becomes the Treasury secretary under Obama. They do all this stuff. They get Clinton to sign off on it. He does it with Phil Gramm, the Republican, so it’s bipartisan. Very few people challenge it. You know, now, I think if you ask anybody about Robert Rubin, they say, God, yeah, he wasn’t too good for it. I’ll bet you his own family members think he got his–you know, what happens? He leaves the Clinton administration; he goes to work for a bank that he makes legal, right? The merger of Citibank and Travelers Insurance they make legal with their reversal of Glass-Steagall, the Financial Services Modernization Act, and then they got the Commodity Futures [Modernization Act], which makes these gimmicks legal. He gets $10 million a year for the next decade. Sure, he’s got money salted away. But I don’t think he’s got a reputation that’s worth anything. I don’t know. Lawrence Summers, again, I don’t think people particularly treat those with respect. But they have money. You know, they can take care of their nephews and nieces. But I think it’s generally accepted they caused a lot of damage to the economy.

JAY: But it’s not, like, that it’s just a bad group of people happened to get into power. And I’m not suggesting you’re suggesting that.

SCHEER: No, it’s the best and the brightest that Halberstam wrote about in Vietnam. These are very well educated people who know what they’re doing and, I believe, have to know it’s going to destroy the lives of millions of people, and they go ahead and do it. It’s just like–.

JAY: Yeah, ’cause they say if it ain’t me doing it, it’s going to be him doing it, or her.

SCHEER: Whatever their rationalizations, they surround themselves with lawyers and PR people who tell them this is all wonderful, and they get away with it.

JAY: But it’s the way the system has evolved that so much money is in so few hands. There’s not much else for them to do with it than bet and gamble against each other, create this massive speculative sector of the economy, which is financializing everything. Even when they talk about climate change, all they really have in mind is a way to financialize it. So whether it’s this group or the other group, the sort of system itself is created where there’s–so much capital has become completely parasitical.

SCHEER: Yes, but they could also be decent people. They could actually wonder about what would Jesus do. They could actually think about what does their lives mean.

JAY: I think some do and drop out.

SCHEER: A few.

JAY: Some do, and they can’t take it anymore, and they drop out.


JAY: But they’re not in any position to change the course of the ship.

SCHEER: Well, but also the question you should ask is why aren’t they being observed in doing this. And the reason is because they can buy off everyone.

JAY: Especially the media.

SCHEER: The media, but the universities, the grants of–you know, build buildings at universities. Come on.

JAY: I want to stress the media ’cause they have this theatrical show going in the elections–I’m not saying there isn’t a real contention for power, but when you have unlimited contributions, unlimited spending, what are they spending it on? They’re spending it on TV advertising.

SCHEER: Yeah, and they’re spending it on candidates who will not give them a hard time. There’s no question about it.

But it’s not just the media. I mean, I don’t want to exonerate the media, but you–you know, in the day of the internet, you should have more critical voices, right, ’cause–but even there you look at where could–you know, okay, to understand the economy or foreign policy requires a little brainwork, okay? Most people have got to take care of their job and their family and pick the kid up and how do I pay this bill and am I going to lose my job and/or how am I going to make that sale. And so their lives are taken up. And then we have a group of people, whether they’re called journalists or professors or consultants or what have you who actually have the time and are really charged with figuring stuff out.

Now, most of this stuff is not all that difficult to figure out. So then you have to ask yourself the question, why didn’t you figure it out? I mean, why didn’t the media–in my book I describe how The New York Times was a cheerleader for this radical deregulation. They used words like modernization. They said long overdue. Now, why? You know, because they were living in a culture and benefiting from a culture that was benefiting from the ripoff. These are the people who advertise. These are the people who invest in your venture, in your media. These are the people who buy chairs at the schools where you’re teaching. These are people who support the charities or political causes that you happen to agree with. There is a culture of corruption, I mean, ’cause anyone else looking at this, they say, wait a minute, this is nonsensical, this is bad. Why are you selling–I remember writing about this stuff. I would go out to what they call the Inland Empire in California where they’re building all of these–. I said, who’s going to live here? How are they going to get to work? Who’s paying for this? Why are they making the loans? And then you realize there is no there there. Don’t confuse the thing–I remember an old advertising [incompr.] don’t confuse the thing being sold with the thing itself. They’re not selling a house to somebody who needs a house and is going to live and be able to afford the payment; they’re selling this collateralized debt obligation that’s 1,000 of those houses that you have made and chopped up and iced and diced and everything and sliced, and then you’re going to make that seem like a good bet to somebody. Where? In Saudi Arabia or in France or–.

JAY: Knowing it’s all going to default.

SCHEER: Yeah, but you’re going to get in and out before it defaults.

Humor: The Borowitz Report

Number of G.O.P. Candidates Now Thirteen, Says C.D.C.



(The Borowitz Report)—The number of official candidates for the 2016 Republican Presidential nomination has risen to thirteen, according to officials at the Centers for Disease Control.

The count had stood at twelve since the announcement last week by the reality-show host Donald Trump, leading many at the C.D.C. to privately hope that the epidemic was losing steam.

But with the entry of Louisiana Gov. Bobby Jindal into the race on Wednesday, the C.D.C. was forced to hold a press conference to announce the worrisome news that the number of candidates had increased yet again.

“It might have been misplaced optimism on our part, but we had started to believe that this thing had been contained,” said the C.D.C. spokesman Dr. Harland Dorrinson. “Regrettably, it has not.”

While scientists disagree about how running for President spreads from person to person, most epidemiologists believe that a candidacy needs an environment rich in narcissism and delusion—plus a host to feed on, ideally a sociopathic billionaire.

The C.D.C. spokesman refused to address speculation that Wisconsin Gov. Scott Walker would soon enter the race, bringing the number of candidates to fourteen. “I don’t want to say anything that might cause the public to panic,” he said.