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Charles Ganske of Russia Blog excerpted a portion of Simon Johnson's May 2009 article at the Atlantic Monthly titled, "The Quiet Coup." The author, Professor Johnson, served as director of the International Monetary Fund from 2007 to 2008, and currently is an academic economist at MIT's Sloan School of Management. Here are a few provocative excerpts:
...at the outset of the crisis, the oligarchs are usually among the first to get extra help from the government, such as preferential access to foreign currency, or maybe a nice tax break, or—here’s a classic Kremlin bailout technique—the assumption of private debt obligations by the government. Under duress, generosity toward old friends takes many innovative forms. Meanwhile, needing to squeeze someone, most emerging-market governments look first to ordinary working folk—at least until the riots grow too large....
Instead, the American financial industry gained political power by amassing a kind of cultural capital—a belief system. Once, perhaps, what was good for General Motors was good for the country. Over the past decade, the attitude took hold that what was good for Wall Street was good for the country. The banking-and-securities industry has become one of the top contributors to political campaigns, but at the peak of its influence, it did not have to buy favors the way, for example, the tobacco companies or military contractors might have to. Instead, it benefited from the fact that Washington insiders already believed that large financial institutions and free-flowing capital markets were crucial to America’s position in the world.
Freshman Democrat Alan Grayson Attacks Obama's War Policy
by Christopher Bateman | Vanity Fair
In 2007, Vanity Fair’s David Rose wrote about an ambitious lawyer and entrepreneur named Alan Grayson, who at the time was suing KBR and other defense contractors in Iraq for alleged fraud on behalf of whistleblowers and American taxpayers. Grayson, who ran for Congress unsuccessfully in 2006, ran again in 2008, and this time was elected to represent Florida’s 8th district, which encompasses part of Orlando....
Have you been pleased at all with the Obama administration’s policies in Iraq and what they’ve done there so far?
By David Swanson
If you're like me you find it at least a bit disturbing that we're giving trillions of dollars to save the economy to the very people who wrecked it, and more disturbing that we're doing so without any solid basis for expecting to get much of it back and without making fundamental changes to prevent a repetition. But if you're like me, you also aren't 100 percent certain how a credit default swap works with a cubed collateralized debt obligation, much less whether such a monstrosity needs to be eliminated or reformed. What to do?
Greenspan Says Banks Still Have a ‘Large’ Capital Requirement
By Alison Fitzgerald | Bloomberg
Former Federal Reserve Chairman Alan Greenspan signaled that the financial crisis has yet to end even as borrowing costs tumble, warning that U.S. banks must raise “large” amounts of money.
“There is still a very large unfunded capital requirement in the commercial banking system in the United States and that’s got to be funded,” Greenspan said in an interview yesterday in Washington. He also said that “until the price of homes flattens out we still have a very serious potential mortgage crisis.”
Greenspan’s comments suggest he sees a bigger capital shortfall in the banking system than reflected in regulators’ stress tests on the 19 biggest U.S. lenders. Treasury Secretary Timothy Geithner told lawmakers yesterday that banks have issued more than $56 billion in new stock or debt since the tests found 10 firms needed to raise about $75 billion. Read more.
US financial institutions will repay $25bn (£16bn) of bail-out funds over the next year, the US Treasury says.
Treasury Secretary Timothy Geithner told US Congress the money will be used to further assist institutions in need of financial help.
Including the anticipated repayment, he estimated that $123.7bn was left from the the $700bn financial bail-out fund approved by Congress in October. Read more.
It would be an exaggeration to say that Congress has a once-in-a-lifetime opportunity this week to reform the policies of the International Monetary Fund. If the future is like the past, if Congress misses this opportunity, another one will come along - in about 10 years or so.
This week, House and Senate leaders are meeting in a conference committee to work out the differences between the House and Senate versions of the supplemental appropriations bill. The Senate version of the bill is likely to include $100 billion and new authorities for the IMF, but the House version of the supplemental bill did not include funds for the IMF. The Senate is debating amendments now as I write. The conference committee will almost surely meet soon after Senate passage; the stated goal is to pass the supplemental before the Memorial Day recess.
"Over the Rainbow"
By Stephen Lendman
This writer just completed a six-part series on Ellen Brown's remarkable 2007 book titled "Web of Debt." This article follows from it by picking up on the theme she struck, using L. Frank Baum's "The Wonderful Wizard of Oz" as a combination parable, monetary allegory, and political manifesto for change at a time it's most needed.
Published in 1900 as an American fairytale, it became a popular staple, later made into the classic 1939 film staring Judy Garland, the 1975 award-winning Broadway musical, The Wiz, featuring the first-ever all-black cast, followed by a hit film on the stage production.
As Brown explained, who would have thought this "charming tale....was drawn from that most obscure and tedious of subjects, banking and finance," and (in the wrong hands) the chokehold they have on societies. Who understood that it was "all about people power, manifesting your dreams, (and) finding what you wanted in your own backyard." Who also could have imagined that "the real-life folk heros who inspired (Baum's) plot may have had the answer to" today's global economic crisis.
Brown began by quoting Hans Schicht in a 2005 editorial headlined "The Death of Banking and Macro Politics" in which he stated:
"Through a network of anonymous financial spider webbing only a handful of global King Bankers own and control it all....Everybody, people, enterprise, State and foreign countries, all have become slaves chained to the Banker's credit ropes."
By Dave Lindorff
A new study of 1004 union organizing drives conducted by the director of labor education research at Cornell University’s School of Industrial and Labor Relations has found that two-third of the companies involved were violating US labor law by holding one-on-one interrogations of workers, by threatening workers about their union support, by firing union organizers or using half a dozen other illegal tactics to defeat unionization campaigns.
Prof. Kate Bronfenbrenner, author of No Holds Barred: The Intensification of Employer Opposition ot Organizing, says that these illegal tactics by employers have been used to drive union representation at American companies down to only 12.4 percent from a level of 22 percent just 30 years ago.
Host: Basima Farhat
Ellen Brown developed her research skills as an attorney practicing civil litigation in Los Angeles. In Web of Debt, her latest book, she turns those skills to an analysis of the Federal Reserve and “the money trust.” She shows how this private cartel has usurped the power to create money from the people themselves, and how we the people can get it back. Brown developed an interest in the developing world and its problems while living abroad for eleven years in Kenya, Honduras, Guatemala and Nicaragua. She returned to practicing law when she was asked to join the legal team of a popular Tijuana healer with an innovative cancer therapy, who was targeted by the chemotherapy industry in the 1990s. That experience produced her book Forbidden Medicine, which traces the suppression of natural health treatments to the same corrupting influences that have captured the money system. Brown’s eleven books include the bestselling Nature’s Pharmacy, co-authored with Dr. Lynne Walker, which has sold 285,000 copies.
Reviewing Ellen Brown's "Web of Debt:" Part VI
By Stephen Lendman
This is the sixth and final article on Ellen Brown's superb 2007 book titled "Web of Debt," now updated in a December 2008 third edition. It tells "the shocking truth about our money system, (how it) trapped us in debt, and how we can break free." This article focuses on establishing a people-oriented banking system. It's high time we had one and reclaimed what's rightfully ours.
Restoring National Sovereignty with A Truly National Banking System
One serving everyone, not powerful moneychangers alone, the so-called Money Trust cartel of Wall Street bankers looting the national wealth for themselves and heading the country for bankruptcy, tyranny and ruin. Stopping them is Job One, and only mass activist outrage can do it.
At the Chicago Democratic National Convention, William Jennings Bryan won the nomination saying:
"(W)e believe that the right to coin money and issue money is a function of government....I stand with Jefferson (and say), as he did, that the issue of money is a function of the government and that banks should go out of the governing business....(W)hen we have restored the money of the Constitution, all other necessary reforms will be possible, and....until that is done there is no reform that can be accomplished."
Yes, you can pay off all your personal debts -- as I have, with 100% of my mortgage paid off and zero credit card or any other debts. But that won't save you from the ravages of bailout-based inflation. When money loses its value due to inflation -– as it will very shortly -- it's almost as bad as paying interest, or high taxes.
D.C. Area Residents Opposed to Af-Pak War Hold Sunday Rally | Press Release
On the heels of a Congressional vote for more war funds, passed at the behest of the White House, local peace and justice activists will hold a Sunday afternoon rally calling for an end to continual war and occupation of Afghanistan, and drone bombings of Pakistan.
Following a House of Representatives vote Thursday approving $96.7 billion in additional war funding, local activists organized an anti-war rally to be held Sunday, 1:30 PM in Lafayette Park. Among the speakers are Ray McGovern, a former senior CIA analyst; Medea Benjamin, co-founder of Code Pink Women for Peace and Global Exchange; and Erik Leaver a senior policy analyst with the Institute for Policy studies.
Reviewing Ellen Brown's "Web of Debt:" Part V
By Stephen Lendman
This is the fifth of several articles on Ellen Brown's superb 2007 book titled "Web of Debt," now updated in a December 2008 third edition. It tells "the shocking truth about our money system, (how it) trapped us in debt, and how we can break free." This article focuses on taking back our money power.
Recapturing What's Ours and Turning Scarcity to Abundance
In 1952, Norman Vincent Peale (1898 - 1993) first published his most famous book - "The Power of Positive Thinking." It sold about five million copies and was a New York Times bestseller for 186 consecutive weeks delivering messages like: "Never talk defeat. Use words like hope, belief, faith, victory." FDR struck the same theme in saying: "The only thing we have to fear is fear itself."
In 1900, Frank Baum's The Wizard of Oz was first published, conveying "the notion that a life of scarcity could be transformed in an instant into one of universal abundance...." In real life, the secret is by taking back our money power from the private bankers who stole it in 1913, in the middle of the night, two days before Christmas, and kept it ever since.
Today's real cause of scarcity is that "somebody is paying interest on most of the money in the world all of the time," and by so doing enslaves nearly everyone in perpetual debt bondage. Meeting America's huge debt burden requires the money supply to keep expanding, "and for that to happen, borrowers must continually go deeper into debt, merchants must continually raise their prices, and the odd men out in the bankers' game of musical chairs must continue to lose their property to the banks."
The result - inevitable wars, competition, strife, inflation, deflation, recessions, depressions, debt bondage, poverty, and despair, while at the same time bankers get fabulously richer and more powerful.
A New Way Forward is encouraging people to hold "teach ins", video screenings on June 10th! Go here!
Here's a terrific 35 minute video to download and show at home (or at the public library or other event location).
Reviewing Ellen Brown's "Web of Debt:" Part IV
By Stephen Lendman
This is the fourth in a series of articles on Ellen Brown's superb 2007 book titled "Web of Debt," now updated in a December 2008 third edition. It tells "the shocking truth about our money system, (how it) trapped us in debt, and how we can break free." This article focuses on America's "web of debt" entrapment.
The Debt Spider Captures America - American Workers Consigned to Debt Serfdom
America has been trapped for over two centuries, with today's debt level way exceeding developing nations. Like bankrupt people staying "afloat by making the minimum payment(s) on (their) credit card(s), the government (avoids) bankruptcy by paying just the interest on its monster debt" - now double in size since Brown's first edition and onerous enough for Controller of the Currency David Walker to warn earlier of its unaffordability by this year. If America can't service the amount, it's officially bankrupt and the economy will collapse. If it happens, IMF austerity will follow and turn America into Guatemala. Other vulnerable economies as well - permanent debt bondage and worker serfdom.
Catherine Austin Fitts was a former high-level Wall Street and government insider. She points to a "financial coup d'etat" conspiracy between the two to hollow out America, centralize power and knowledge, shift wealth to the top, destroy communities and local infrastructure, create new wealth by rebuilding them, and leave human wreckage in its wake.
The Federal Reserve and Current Crisis of our Democracy
By Time for Change | Democratic Underground
Can people really handle their responsibilities as citizens? Or must our "betters", who claim to know what is best for us, forever lead us around like children? We need to cut through their fog and condescension. We must reclaim our power as citizens.
The Federal Reserve System originated in a highly secret meeting of seven of the wealthiest men in the world, taking place at Jekyll Island, off the coast of Georgia in 1910. The seven men included one of our nation's most powerful U.S. Senators, Nelson Aldrich, and six bankers. An article written by one of its participants, Frank Vanderlip, 22 years after the passage of the Federal Reserve Act, documents the aura of secrecy that surrounded the creation of the Federal Reserve:
Senate Rejects Limit on Credit-Card Interest Rates
By Carl Hulse | NY Times
Despite complaints that banks and credit card companies are gouging customers by charging outrageous interest rates, the Senate on Wednesday easily turned back an effort to cap interest rates at 15 percent.
The effort by Senator Bernie Sanders, the Vermont independent, drew only 33 votes and needed 60, with a bipartisan group of 60 senators opposing it as the Senate pushed its credit card overhaul toward the finish line. Some Democrats and consumer groups have said that an interest cap is needed to put real teeth into an otherwise solid bill.
By Dave Lindorff
You might imagine that, even if they didn’t give a rat’s ass about their employees, the managers of General Motors would at least feel an obligation to show some solidarity with the beleaguered bondholders and shareholders of the company that they have so effectively run into the ground.
Aren’t captains supposed to go down with the ship, or at least wait until all the passengers and crew have been safely offloaded?
Apparently that ancient ethic of leader responsibility doesn’t extend to captains of industry.
By Cecilia Kang, Washington Post
The Obama administration today said it would reverse rules made during the Bush administration that made it difficult to stop anticompetitive business behavior.
READ THE REST AT THE WASHINGTON POST, and then ask whether this will apply to banks, media outlets, or branches of government (since when do presidents get to make and unmake and remake laws by publishing "rules" following each election?).
What impresses me in the current financial crisis is the near-total failure of many who call themselves progressives to appreciate the magnitude of what is going on or the level of intelligence behind it. How many will say, for instance, that the crash was deliberately engineered by the creation then destruction of the investment bubbles of the last decade?
Recently, Heather Boushey, senior economist at the Center for American Progress, pointed out that women "are now a greater share of those employed because the industries where men predominate have been hemorrhaging jobs." In fact, she noted that, according to the latest Bureau of Labor Statistics monthly survey of employers, between the beginning of the current recession in December 2007 and February 2009, job carnage has hit in this way: 76.7% of all nonfarm jobs lost and 73.5% percent of all private-sector jobs lost had been filled by men. This, in turn, puts more pressure on women who are now, in millions of families across the United States, the primary breadwinners.
Reviewing Ellen Brown's "Web of Debt:" Part III
By Stephen Lendman
This is the third in a series of articles on Ellen Brown's superb 2007 book titled "Web of Debt," now updated in a December 2008 third edition. It tells "the shocking truth about our money system, (how it) trapped us in debt, and how we can break free." This article focuses on global debt entrapment.
Global Debt Enslavement - From Gold Reserves to Petrodollars
Two Fridays ago on the first day of its release, I went to an early afternoon screening of the film The Soloist. I'd been eager to see it since it focuses on the real life relationship between Los Angeles Times journalist Steve Lopez and Nathaniel Anthony Ayers, a homeless member of Los Angeles' Skid Row community suffering from debilitating mental illness. In the story, as told in Lopez' columns in the LA Times, in his book, and in the screenplay by Susannah Grant, Lopez first meets middle-aged Nathaniel Ayers in downtown Los Angeles in front of a statue of Beethoven where Ayers is playing a two string violin. In that serendipitous meeting Lopez discovers that as a youth Ayers had been a gifted student at Juilliard, New York's prestigious school for the performing arts. This revelation leads Lopez on a personal mission to rehabilitate the troubled man - a mission Lopez is still on today, four years after their first encounter.
My intense desire to see this film had been predicated, foolishly as I have since come to learn, on the romantic notion that viewers would see The Soloist and be moved to help the homeless. But the film I saw, with its cartoon-like unsympathetic portrayal of the people of Skid Row, that displayed none of their individuality, humanity or humor, would never provoke such action. Instead of showing the hearts of the inhabitants and telling a few of their tales, the film portrayed them as a Fellini-esque monolith - a tainted Gomorrah teeming with decadence and dereliction.
AP Sources: Obama wants Fed to be finance supercop
By Anne Flaherty | Associated Press | Google News
The White House told industry officials on Friday that it is leaning toward recommending that the Federal Reserve become the supercop for "too big to fail" companies capable of causing another financial meltdown.
According to officials who attended a private one-hour meeting between President Barack Obama's economic advisers and representatives from about a dozen banks, hedge funds and other financial groups, the administration made it clear it was not inclined to divide the job among various regulators as has been suggested by industry and some federal regulators.
"The idea of having a council of regulators was pretty much vetoed," said one participant.
The concept of the "Long War" is attributed to former CENTCOM Commander Gen. John Abizaid, speaking in 2004. Leading counterinsurgency theorist John Nagl, an Iraq combat veteran and now the head of the Center for a New American Security, writes that "there is a growing realization that the most likely conflicts of the next fifty years will be irregular warfare in an 'Arc of Instability' that encompasses much of the greater Middle East and parts of Africa and Central and South Asia." The Pentagon's official Quadrennial Defense Review (2005) commits the United States to a greater emphasis on fighting terrorism and insurgencies in this "arc of instability." The Center for American Progress repeats the formulation in arguing for a troop escalation and ten-year commitment in Afghanistan, saying that the "infrastructure of jihad" must be destroyed in "the center of an 'arc of instability' through South and Central Asia and the greater Middle East."
The implications of this doctrine are staggering. The very notion of a fifty-year war assumes the consent of the American people, who have yet to hear of the plan, for the next six national elections. The weight of a fifty-year burden will surprise and dismay many in the antiwar movement.