School of Life Monday:POLITICAL THEORY - John Maynard Keynes

John Maynard Keynes was arguably the greatest economist of the 20th century. He discovered the idea that governments should stimulate demand during economic downturns – and was the creator of both the IMF and the World Bank.

Humans Need Not Apply

School of Life Monday: How to Enrich a Country: Free Trade or Protectionism?

What is the best way to make a country rich? Should you adopt a policy of free trade? Or is protectionism and economic nationalism the better way? We explore the history and theory of one of the central questions of economics and politics.

Where Does the American Dream Live?

THINKING CAP WEDNESDAYCapitalism's operating system has gone off the rails: An interview with Douglas Rushkoff

from Dangerous Minds:

In his latest book, Throwing Rocks at the Google Bus: How Growth Became the Enemy of Prosperity (Portfolio/Penguin), media/technology theorist and PBS documentarian, Douglas Rushkoff asks “Why doesn’t the explosive growth of companies like Facebook and Uber deliver more prosperity for everyone? What is the systemic problem that sets the rich against the poor and the technologists against everybody else?”



Rapid technological improvements have created unforeseen societal chaos and this change is just starting to pick up speed. Our economic operating system—the “program” at the heart of Capitalism itself—is deliriously out of control. The economy no longer serves the human race, just a tiny elite sliver of it. The rest of us, whether we realize it or not, to a certain extent toil on their behalf. Think about it: How did the Waltons become the richest family in America, amassing a collective fortune of around $150 billion, if not by siphoning off a micropayment from every single gallon of milk, bottle of shampoo or box of Hostess Ding Dongs sold there? Bud and Sam Walton might have started Walmart, but all their offspring did was win the lottery at birth.

If you think that sounds predatory—and it should—just wait until you get a load of what the big technology firms have in mind for us…

I asked my friend of some twenty years some questions over email.

Richard Metzger: You write how the operating system of capitalism is obsolete, creating vast spoils for a select group of lucky human beings who are more or less basically leeching off the rest of mankind’s activities, and in a world of increasing automation to make things even worse. What’s the new book’s diagnosis of the modern economy?

Douglas Rushkoff: That sounds like a pretty good diagnosis to me. Or I suppose those are the symptoms? The underlying problem is not a disease, however. It’s not that corporate capitalism has been corrupted by greed or even by the startup economy of digital businesses. The system is working precisely as it was designed to.

It’s just that the transfer of value from people and places into capital used to happen a bit slower. And our companies tended to do it to other places more than to us. So in the 1400’s, British East India Trading Company might have enslaved thousands of Africans or taken land from the people of the West Indies - where today it’s Walmart bankrupting our towns and Uber extracting labor from drivers.

So now, the extractive power of expansionary, growth-based capitalism has been turned against us. The same sorts of companies are growing, but at the expense of all humans - not just those we can’t see. And the startup economy does all this a whole lot faster. A company goes from zero to a billion in 24 months. And it only does that by abandoning its original goals of helping people do something new, and instead adopting scorched earth policies toward its own markets.

That’s the real problem: companies that want to be around for a long time need to keep their markets - their customers and suppliers and workers - healthy and viable. Once companies are in control of venture capitalists, that’s no longer the goal. They haven’t bought the company to own it, but to sell it. They only need their markets to survive long enough to get to the exit - the IPO or acquisition that lets them cash out.

In the process, the company can use its war chest of investment capital to regulate the marketplace in its favor, or undercut the prices of the competition. It’s not about doing business; it’s about selling the company.



Okay, if that’s the diagnosis, then what’s the remedy? Is there one?

There’s not a single remedy. That’s the one-size-fits-all ethos of the industrial age: figure out the solution, then scale it universally! (And make a ton of money in the process.) Rather, the solution set will be as varied as the people and communities of our planet. The first step is to remember that human beings retain their home field advantage as long as they stay in the real world, on planet earth. We are the natives here - the corporations and technologies and business plans are all invented alien. That’s part what the SF protesters mean when they lay in front of the Google buses.

The way to reduce the power of the companies extracting value from our economy is to begin transacting locally and laterally. Do as much locally as you can. See your town or city as the economy. If there’s people with needs, and people with skills, you have the basis for an economy. You just may need to develop an alternative means of exchange, such as a local currency or favor bank.

Of course that doesn’t replace the entire economy. People look at a suggestion like that, and they immediately thing I’m arguing that cash, banking, corporations, iPhones, and automobiles go away. We can’t help but think of things in apocalyptic terms. But all I’m suggesting is that we balance out even just a little of our Walmart or Amazon purchases with some more local, small-scaled value creation and exchange.

The other remedy is for those developing new technologies or applications not to accept so much venture capital. They still think that getting a lot of money for their idea is the best way to build it. But it’s not. The more money you take, the less control you have over the future of your company. When you take in VC, you have already sold your company to someone who doesn’t care about your app, your customers, your employees, or your mission. Kiss it good-bye. They only care about selling your business to someone else - to the next round of investors - and that means plumping it up. You will be forced to pivot from whatever you wanted to do, to something they think can let them sell the company. It doesn’t even have to make money - it just has to destroy a market and claim a monopoly over what’s left. 

I can’t help myself: What’s the prognosis?

I’m hoping that we can buffer the effects of the digital economy by engaging in some alternatives. Every exchange you make with another person amounts to an attack on the system. Corporations hate when we buy and sell from each other. That keeps money in circulation, and makes us less dependent on them for everything. If you buy from a small business, or sell to people instead of just working as an employee for a corporation, then you are threatening the corporate monopoly. They hate that; it confounds them - particularly if you do it even though the price may be higher. The full cost is ultimately a lot lower.

So I think we either soften the effects of all this extraction and begin to engage directly with other humans, or we watch more and more value - land and labor - get destroyed and converted into share prices. The market keeps going up as people and the planet are decimated.

It’s quite probable that our economic models are now more powerful than the human will to perpetuate our civilization. That’s why guys like Ray Kurzweil are now running Google: the world’s biggest corporations are run by people who envision a world without human beings. Where the corporate computers are our evolutionary successors.

That’s a quite probable prognosis, and I don’t like it. I don’t think computers experience love or even consciousness. I know it’s terribly judgmental, but I favor human life and consciousness to AI and machine life. As a human, I can’t help but feel something is special about us. So I’m still going to fight for a role for human beings in the future. I am on Team Human, and believe we should dare to tinker with capitalism in order to preserve a place for us and the rest of biology on our planet.

 



 

You’re CUNY’s Professor of Media Theory and Digital Economics. Digital economics? Can you define what that means, both in the loftier academic sense, and what it means in a more “real world” way? How do digital economies impact our lives?

To me, digital economics is looking at the political economy of digital media. That’s not just a smart phone in your hand:  it’s a business plan; it’s the expression of the corporate landscape; it’s an approach to energy and resources; it’s a reflection of our relationship to labor, and how much we are capable of camouflaging that labor. It’s a test of how far we are willing to outsource slavery in order to obtain inexpensive electronics.

The digital economy effects all of our lives, whether it’s Amazon destroying a marketplace, Airbnb destroying a neighborhood, Uber destroying an industry, or Facebook monetizing your social graph. When a robot replaces you at work, it’s real easy to blame technology. But it’s not the technology that’s costing you your income, it’s an industrial economy that has been built on the premise of extracting value from people and places, and converting it into pure capital.

The “value” of a commodity or service used to be backed by gold. Now it’s backed by… well, I’m not confident that I know exactly what it is that stores value anymore. Perhaps it’s by a collective gentlemen’s agreement of the world’s rulers, or by virtue of a collective hallucination that we all desperately want to buy into to keep society from collapse. Is economic reality just a matter of what they can get away with, put in the simplest way I can pose that as a question?

Well, the whole idea of money having value in itself is the bizarre part. That’s the part that kills economies. The purpose of money used to be to promote the exchange of value. It was a convenient, temporary IOU that people used to trade for things in the marketplace. You didn’t want to have IOUs at the end of the market day. You just wanted the stuff. More like poker chips than the money they represented.

Yeah, there were precious metals and other sorts of things used as money, but they didn’t work very well. People hoarded gold coins, and there were never enough in circulation for people to get and sell all they wanted to.

The real money was market money - these temporary IOUs. And that money was so great at helping people exchange value that the people got rich. That’s why the aristocracy outlawed it. They forced people to use central currency - to borrow it, at interest. This way, the people with money got to get wealthier simply by being allowed to lend it out. What enforced the value of that money? Really, nothing but the law.

What makes money valuable is the declaration that it is our coin of the realm. Problem is, it’s much much better at storing value than helping people exchange it. We programmed our money to be more like fat than muscle. Corporations are great at accumulating it, but really bad at deploying it. The more money they take in, the more like banks they become. Their main activity is financial, not real.



I’m an online/digital publisher, but having been a physical book publisher earlier in my career, and also working at a daily newspaper, I know intimately how the print paradigm fell apart. Where does “digital economics” create value in a digital, knowledge-based space (like any online media property) if not via advertising—few people seem willing to pay for content on the Internet—and do you feel that the ad blocker is an existential threat to the likes of Yahoo and Google, if not the entire infotainment ecosystem?

The real threat to the ad-based Internet is the fact that advertising and marketing have never accounted for more than around 4% of the total GDP (a measure of the whole economy). And that’s being generous. But here we are, staking the future of many many industries on their ability to market and advertise. Everything from Google and Facebook to big data is ultimately an advertising play. But if we’re all supposed to write and sing and perform and create for the ad revenue, then who is left to advertise? There’s not enough toothpaste and razor blades to pay for all this.

The last laugh is that this thing that digital platforms did to books and music and movies and jobs? It’s going to do that to finance itself. The capital markets are driving themselves into a mega bubble - a bubble of bubbles. This is the stock market on steroids, and they’re shooting more into their veins every day. And we all know how that ends.

But yeah, ad blockers are at the frontline of the war between two models of digital media - the fee-for-service model of HBO or Apple, and the ad-backed but otherwise free model of Google or broadcast TV.

I find Google’s lack of a response or any kind of announced strategy to deal with Apple’s ad blockers to be very troubling. I’ve heard rumors of a lot of meetings and talk, but not of actual solutions that will be rolled out in this quarter or next. The digital giants are going at each other’s throats. Isn’t this the sort of frenzied cannibalistic capitalism you warn about in the book?

Yeah. In the digital economy as they’re playing it, there’s a true winner-takes-all ethos. They’re not playing for a part of the market. They’re playing for the whole damn thing. Companies don’t just eat one another in the pursuit of growth; they actually cannibalize themselves. Yahoo is selling off it’s “core businesses.” What does that really mean? I mean, think about that one!

So Karl Marx is proven correct, yet again?



Maybe even Lenin more than Marx. He was a bit more incremental in his approach, and spoke more specifically about workers owning the means of production (rather than working for companies that owned all the equipment and could leverage that to exploit people). And he also coined the notion of a “society of abundance,” which is the problem we’re dealing with: markets based on scarcity just won’t work in a world where things are in abundance.

But yeah Marx was right. But we can’t say that in America, because people think it’s “communist.” They’re wrong, of course. We’re not talking about redistributing the spoils of capitalism after the fact; we’re talking about pre-distributing the means of production from the get-go.

Below, a November 2015 talk at the New School in New York City:

 

Buy Throwing Rocks at the Google Bus: How Growth Became the Enemy of Prosperity at Amazon

Mother Jones: Griping Aside, America Is In Pretty Damn Good Shape

by Kevin Drum at Mother Jones:

Yesterday at lunch, I was mulling over all the familiar laments we've heard this year about voter anger and America decline. And I thought: really, what's so bad? I should write a post about this.

Today I woke up, and in a remarkable example of precog telepathy, Politico's Michael Grunwald had written almost exactly the piece I had in mind:

Start with the economy....Unemployment has dropped from 10 percent during the worst of the Great Recession to 5 percent today....The housing market has also rebounded from the crisis, and after-tax corporate profits are at an all-time high....The oft-predicted doomsday scenarios of the post-crisis era—double-dip recession, runaway inflation, runaway interest rates, out-of-control energy prices, a health insurance death spiral, a Greek-style debt crisis, a run on the dollar—are still stubbornly refusing to materialize. Growth is modest but steady. Inflation is low....About 17 million uninsured Americans have gotten coverage in the past few years. The federal deficit has plunged from $1.4 trillion in 2009 to under $500 billion, while the dollar has gained strength against foreign currencies.

....Meanwhile, other recent developments—cheaper gas, free birth control and preventive care, the elimination of annual and lifetime caps on health insurance, expanded tax credits for the working poor, increased efficiency measures that lower energy bills, and much more—have put more money in the pockets of American families, even though their incomes have grown slowly.

....Crime in big cities dropped about 5 percent in 2015, and has been cut in half since 1990. The teen birth rate is down more than 60 percent since 1990....Carbon emissions have dropped 10 percent from 2005 levels. High school graduation rates are at an all-time high....And despite all the rhetoric about border crises and wall-building, America’s population of undocumented immigrants has remained stable for the past five years.

....Legislative gridlock in Washington eased significantly in 2015. After four years of divided-government paralysis, President Obama signed a slew of major bipartisan laws last year, including a bizarrely responsible reform of a long-standing Medicare funding problem and a sensible overhaul of the unpopular No Child Left Behind education law.

There's no need to be too Pollyannish, of course. Wages continue to be pretty stagnant. The Middle East is in flames. Reproductive rights are under sustained attack. Way too many unarmed blacks are being shot by police. Heroin use has become an epidemic. Etc.

But generally speaking, Grunwald is right. America weathered the Great Recession better than Europe, better than China, better than Japan, better than Russia, better than just about anybody. Health care costs have been growing slowly and more people are covered than ever before. Taxes are low on the middle class. The tech revolution has delivered an insane—and surprisingly high quality—number of entertainment options available to almost anyone. Campaign rhetoric notwithstanding, American military strength is unmatched by anyone in the world, and it's not even close. Telepathy has apparently been developed by the editors at Politico.

That's not bad, is it?

POSTSCRIPT: Normal griping about all our problems will resume shortly. Don't worry: I have not been taken over by aliens.

MUST WATCH SATURDAY: The Story of Bottled Water

from The Story of Stuff (A website full of video's I highly recommend)

Story of Bottled Water FAQs

Is bottled water cleaner?
The EPA regulates tap water under the Safe Drinking Water Act. Public water operators must provide reports to customers describing their water’s source, evidence of contaminants, and compliance with federal, state, and local regulations. The FDA regulates bottled water and cannot require certified lab testing or violation reporting; bottlers themselves are responsible for testing. Furthermore, the FDA doesn’t require bottled water companies to disclose where the water came from, how it was treated, or what contaminants it contains.

Is bottled water tastier?
Corporate Accountability International’s “Think Outside the Bottle” Campaign has held countless taste tests comparing bottled water to tap water, as have many media outlets, from the New York Times to Cleveland’s local TV news channel. The results generally favor the tap. But ultimately, the point isn’t whether one tastes better than the other, its how our taste—and our tastes—are shaped by advertising rather than by what’s good for us.

Is bottled tap different than plain tap?
Bottled water companies go to great length to tell you that while their water originates from a public water source, its more than just filtered tap water. They boast proprietary, state-of-the-art, multistage filtration processes and esoteric references to mineral additives that make their water more than just water, and certainly better than tap.

But, as Tony Clarke of Canada’s Polaris Institute points out in his book, Inside the Bottle, “unlike other resource production processes, where raw materials like timber, minerals, and oil are transformed into new products, bottled water is different. Bottled water is about ‘turning water into water.'”
And keep in mind that 10 percent to 15 percent of the cost of bottled water goes to the advertising budget. We not only buy their myths, we pay extra for them!

What’s the energy footprint of water bottles?
The Pacific Institute breaks it down like this: “Because bottled water required approximately 1 million tons of PET [Polyethylene Terephthalate] in 2006, those bottles required roughly 100 billion MJ of energy. A barrel of oil contains around 6,000 MJ, so producing those bottles required the equivalent of around 17 million barrels of oil. This is enough energy to fuel one million American cars for one year.” If that sounds crazy that’s because it is!

Really, water is a right?
General Comment 15 of the United Nations Committee on Economic, Social and Cultural Rights—the definitive interpretation of human rights laws regarding water—says “the human right to water entitles everyone to sufficient, safe, acceptable, physically accessible and affordable water for personal and domestic uses” … and …” is indispensable for leading a life in human dignity. It is a prerequisite for the realization of other human rights.”

In other words, it is the job of our governments (as the entities responsible for guaranteeing human rights) to ensure that we have good, clean, affordable tap water.

Need some first steps to take?
Many companies sell safe, easy-to-clean, lightweight drinking water bottles. Food & Water Watch and Corporate Accountability International—two of our partners on this film—offer sleek, stainless steel, reusable bottles to their members. Or pick up a mug or glass or sippy cup or … well, you get the point.

An under-the-sink filter can eliminate both bacterial and chemical concerns if you have either. And you can learn more about your water quality by contacting your local water utility. If find something that concerns you, don’t just turn to bottled water, ask questions, talk to your neighbors and organize to win improvements to your water supply.

What can I do?
Before the bottled water craze hit, we took it for granted that public fountains were part of any public building: schools, offices, sports stadiums and parks. Let’s bring them back! In the U.S., many state building codes mandate that there be one source of public water for every 1,000 people the building has capacity for. Why not subsidize public water fountains as part of local efforts to build green?

Bottled water bans are also spreading fast.In the U.S., San Francisco, Minneapolis, Seattle, and Salt Lake City have all banned bottled water at city functions to save money and promote their cities’ highly drinkable tap water. And in Canada, the Polaris Institute reports that as of December 2009, 72 municipalities from 8 provinces and 2 territories had implemented restrictions on bottled water. Way to go!

File under NO SHIT: Billionaire Cartier Owner Sees Wealth Gap Fueling Social Unrest

from Bloomberg.com:

Johann Rupert, the South African who has made billions peddling Cartier jewelry and Chloe fashion, said tension between the rich and poor is set to escalate as robots and artificial intelligence fuel mass unemployment.

“We cannot have 0.1 percent of 0.1 percent taking all the spoils,” said Rupert, who has a fortune worth $7.5 billion, according to data compiled by Bloomberg. “It’s unfair and it is not sustainable.”

The founder and chairman of Richemont, whose 20 brands also include Vacheron Constantin and Montblanc, said he expects advances in technology to lead to job losses after having read books on the subject recently. Conflicts between social classes will make selling luxury goods more tricky as the rich will want to conceal their wealth, Rupert said in a speech Monday at the Financial Times Business of Luxury Summit in Monaco.

“How is society going to cope with structural unemployment and the envy, hatred and the social warfare?” he said. “We are destroying the middle classes at this stage and it will affect us. It’s unfair. So that’s what keeps me awake at night.”

Rupert, a university dropout whose father made a fortune setting up Rembrandt Tobacco Corp. and selling it off, has in the past made other social critiques. Nicknamed ‘Rupert the Bear’ for his pessimistic views on the economy, the 65-year-old refers to himself as a “reformed prostitute,” having spent a decade as an investment banker. He said in 2008 that the collateral damage from the financial crisis was yet to come.

“We’re in for a huge change in society,” he said Monday. “Get used to it. And be prepared.”

Good thing that some one up there is noticing...

How Austerity Kills

New York Times OP-ED By DAVID STUCKLER and SANJAY BASU

EARLY last month, a triple suicide was reported in the seaside town of Civitanova Marche, Italy. A married couple, Anna Maria Sopranzi, 68, and Romeo Dionisi, 62, had been struggling to live on her monthly pension of around 500 euros (about $650), and had fallen behind on rent.

Because the Italian government’s austerity budget had raised the retirement age, Mr. Dionisi, a former construction worker, became one of Italy’s esodati (exiled ones) — older workers plunged into poverty without a safety net. On April 5, he and his wife left a note on a neighbor’s car asking for forgiveness, then hanged themselves in a storage closet at home. When Ms. Sopranzi’s brother, Giuseppe Sopranzi, 73, heard the news, he drowned himself in the Adriatic.

The correlation between unemployment and suicide has been observed since the 19th century. People looking for work are about twice as likely to end their lives as those who have jobs.

In the United States, the suicide rate, which had slowly risen since 2000, jumped during and after the 2007-9 recession. In a new book, we estimate that 4,750 “excess” suicides — that is, deaths above what pre-existing trends would predict — occurred from 2007 to 2010. Rates of such suicides were significantly greater in the states that experienced the greatest job losses. Deaths from suicide overtook deaths from car crashes in 2009.

If suicides were an unavoidable consequence of economic downturns, this would just be another story about the human toll of the Great Recession. But it isn’t so. Countries that slashed health and social protection budgets, like Greece, Italy and Spain, have seen starkly worse health outcomes than nations like Germany, Iceland and Sweden, which maintained their social safety nets and opted for stimulus over austerity. (Germany preaches the virtues of austerity — for others.)

As scholars of public health and political economy, we have watched aghast as politicians endlessly debate debts and deficits with little regard for the human costs of their decisions. Over the past decade, we mined huge data sets from across the globe to understand how economic shocks — from the Great Depression to the end of the Soviet Union to the Asian financial crisis to the Great Recession — affect our health. What we’ve found is that people do not inevitably get sick or die because the economy has faltered. Fiscal policy, it turns out, can be a matter of life or death.

At one extreme is Greece, which is in the middle of a public health disaster. The national health budget has been cut by 40 percent since 2008, partly to meet deficit-reduction targets set by the so-called troika — the International Monetary Fund, the European Commission and the European Central Bank — as part of a 2010 austerity package. Some 35,000 doctors, nurses and other health workers have lost their jobs. Hospital admissions have soared after Greeks avoided getting routine and preventive treatment because of long wait times and rising drug costs. Infant mortality rose by 40 percent. New H.I.V. infections more than doubled, a result of rising intravenous drug use — as the budget for needle-exchange programs was cut. After mosquito-spraying programs were slashed in southern Greece, malaria cases were reported in significant numbers for the first time since the early 1970s.

In contrast, Iceland avoided a public health disaster even though it experienced, in 2008, the largest banking crisis in history, relative to the size of its economy. After three main commercial banks failed, total debt soared, unemployment increased ninefold, and the value of its currency, the krona, collapsed. Iceland became the first European country to seek an I.M.F. bailout since 1976. But instead of bailing out the banks and slashing budgets, as the I.M.F. demanded, Iceland’s politicians took a radical step: they put austerity to a vote. In two referendums, in 2010 and 2011, Icelanders voted overwhelmingly to pay off foreign creditors gradually, rather than all at once through austerity. Iceland’s economy has largely recovered, while Greece’s teeters on collapse. No one lost health care coverage or access to medication, even as the price of imported drugs rose. There was no significant increase in suicide. Last year, the first U.N. World Happiness Report ranked Iceland as one of the world’s happiest nations.

Skeptics will point to structural differences between Greece and Iceland. Greece’s membership in the euro zone made currency devaluation impossible, and it had less political room to reject I.M.F. calls for austerity. But the contrast supports our thesis that an economic crisis does not necessarily have to involve a public health crisis.

Somewhere between these extremes is the United States. Initially, the 2009 stimulus package shored up the safety net. But there are warning signs — beyond the higher suicide rate — that health trends are worsening. Prescriptions for antidepressants have soared. Three-quarters of a million people (particularly out-of-work young men) have turned to binge drinking. Over five million Americans lost access to health care in the recession because they lost their jobs (and either could not afford to extend their insurance under the Cobra law or exhausted their eligibility). Preventive medical visits dropped as people delayed medical care and ended up in emergency rooms. (President Obama’s health care law expands coverage, but only gradually.)

The $85 billion “sequester” that began on March 1 will cut nutrition subsidies for approximately 600,000 pregnant women, newborns and infants by year’s end. Public housing budgets will be cut by nearly $2 billion this year, even while 1.4 million homes are in foreclosure. Even the budget of the Centers for Disease Control and Prevention, the nation’s main defense against epidemics like last year’s fungal meningitis outbreak, is being cut, by at least $18 million.

To test our hypothesis that austerity is deadly, we’ve analyzed data from other regions and eras. After the Soviet Union dissolved, in 1991, Russia’s economy collapsed. Poverty soared and life expectancy dropped, particularly among young, working-age men. But this did not occur everywhere in the former Soviet sphere. Russia, Kazakhstan and the Baltic States (Estonia, Latvia and Lithuania) — which adopted economic “shock therapy” programs advocated by economists like Jeffrey D. Sachs and Lawrence H. Summers — experienced the worst rises in suicides, heart attacks and alcohol-related deaths.

Countries like Belarus, Poland and Slovenia took a different, gradualist approach, advocated by economists like Joseph E. Stiglitz and the former Soviet leader Mikhail S. Gorbachev. These countries privatized their state-controlled economies in stages and saw much better health outcomes than nearby countries that opted for mass privatizations and layoffs, which caused severe economic and social disruptions.

Like the fall of the Soviet Union, the 1997 Asian financial crisis offers case studies — in effect, a natural experiment — worth examining. Thailand and Indonesia, which submitted to harsh austerity plans imposed by the I.M.F., experienced mass hunger and sharp increases in deaths from infectious disease, while Malaysia, which resisted the I.M.F.’s advice, maintained the health of its citizens. In 2012, the I.M.F. formally apologized for its handling of the crisis, estimating that the damage from its recommendations may have been three times greater than previously assumed.

America’s experience of the Depression is also instructive. During the Depression, mortality rates in the United States fell by about 10 percent. The suicide rate actually soared between 1929, when the stock market crashed, and 1932, when Franklin D. Roosevelt was elected president. But the increase in suicides was more than offset by the “epidemiological transition” — improvements in hygiene that reduced deaths from infectious diseases like tuberculosis, pneumonia and influenza — and by a sharp drop in fatal traffic accidents, as Americans could not afford to drive. Comparing historical data across states, we estimate that every $100 in New Deal spending per capita was associated with a decline in pneumonia deaths of 18 per 100,000 people; a reduction in infant deaths of 18 per 1,000 live births; and a drop in suicides of 4 per 100,000 people.

OUR research suggests that investing $1 in public health programs can yield as much as $3 in economic growth. Public health investment not only saves lives in a recession, but can help spur economic recovery. These findings suggest that three principles should guide responses to economic crises.

First, do no harm: if austerity were tested like a medication in a clinical trial, it would have been stopped long ago, given its deadly side effects. Each nation should establish a nonpartisan, independent Office of Health Responsibility, staffed by epidemiologists and economists, to evaluate the health effects of fiscal and monetary policies.

Second, treat joblessness like the pandemic it is. Unemployment is a leading cause of depression, anxiety, alcoholism and suicidal thinking. Politicians in Finland and Sweden helped prevent depression and suicides during recessions by investing in “active labor-market programs” that targeted the newly unemployed and helped them find jobs quickly, with net economic benefits.

Finally, expand investments in public health when times are bad. The cliché that an ounce of prevention is worth a pound of cure happens to be true. It is far more expensive to control an epidemic than to prevent one. New York City spent $1 billion in the mid-1990s to control an outbreak of drug-resistant tuberculosis. The drug-resistant strain resulted from the city’s failure to ensure that low-income tuberculosis patients completed their regimen of inexpensive generic medications.

One need not be an economic ideologue — we certainly aren’t — to recognize that the price of austerity can be calculated in human lives. We are not exonerating poor policy decisions of the past or calling for universal debt forgiveness. It’s up to policy makers in America and Europe to figure out the right mix of fiscal and monetary policy. What we have found is that austerity — severe, immediate, indiscriminate cuts to social and health spending — is not only self-defeating, but fatal.

David Stuckler, a senior research leader in sociology at Oxford, and Sanjay Basu, an assistant professor of medicine and an epidemiologist in the Prevention Research Center at Stanford, are the authors of “The Body Economic: Why Austerity Kills.”

5 Ways That Raw, Unregulated Capitalism Is Acting Like a Cancer on American Society

from Alternet: The predators on our society will scream about threats to "freedom" as soon as we start going after them, but it's just about trying to protect profits.

1. Attacking the Hungry

The uncontrolled growth of investment wealth is diverting resources away from vital programs, effectively smothering them. The average Supplemental Nutrition Assistance Program (SNAP) [4] recipient received about $1,500 for food for the entire year. At least ten Americans each made that much in under ten seconds from their investment gains in 2012 [5], about the time it took each one to fluff his pillow and roll over in bed.

Under capitalism, fortunes accrue to a few while 47 million [6] Americans, or one out of seven, need food assistance [7]. Almost half of the hungry are children [8]. For every food bank we had in 1980 [9], we now have 200.

Yet just 20 people made more from their investment income in one year [5] than the entire 2011 food assistance budget [10]. That's $73 billion, taxed at the capital gains rate. Meanwhile, President Obama couldn't get the $1 billion per year he needed to improve childhood nutrition [9]in schools.

Most recently, the House proposed a farm bill [11] that would cut another $2 billion a year from the food stamps account.

2. Suffocating the Students

The corporate style of capitalism allows young college graduates, the bright hope of the future, to work in minimum wage positions while carrying an average of $26,000 [12] in student loans, which accumulated because tuition rose ten times faster [13] than the cost of living, and which now come with interest rates [14] many times higher than the banks pay.

The great majority of pre-recession jobs have been replaced, if they've come back at all, aslow-wage [15] jobs in food service and retail. The number of college grads working for minimum wage has doubled [16] in five years. They may be the 'fortunate' ones. In 2011, about 360,000 [17]Americans holding advanced degrees were on food stamps or some other form of public assistance. Many of them are homeless [18].

Jobless and frustrated young Americans trusted the system, and it failed them. Yet free enterprise entrepreneurs hustle [19] them for even more college, in order to extract federal loan money, which goes right to the schools to pay administrative salaries.

Defenders of capitalism say hard work will ensure success. At a recent jobs hearing [20] in Washington, only one Congressman bothered to show up.

3. Weakening the Children

The disease has been spreading since the 1960s, when life expectancy [21] began to decrease along with increasing health care costs. Capitalism has betrayed our children. A UNICEF study [22] places the U.S. 22nd out of 24 OECD countries in "children's health and well-being."

Child poverty, perhaps the main cause of their health problems, is up 50% [23] since 1973, with the rate for minorities three times that for white children.

Our global poverty ranking is shameful. Despite having the second-highest average income for children among the 30 OECD countries, the U.S. ranked 27th out of 30 for child poverty [24](percentage of children living in households that are below 50% of the median income).

4. Depleting the Taxpayers

The body of our society has been drained of its vital juices by tax avoidance. Loopholes and exemptions cost the public about a trillion dollars [25] a year, and underreported [26] income costs another $450 billion. The total is much more than the cost of our stable but always threatened Social Security program.

Since the recession, Fortune 500 corporations have cut [27] their tax payments in half, even though their profits have doubled in less than ten years.

Finally, it is estimated [28] that between $21 and $32 trillion is hidden offshore, untaxed, with up to40% [29] owned by Americans. U.S. PIRG [30] estimates that the average taxpayer in 2012 paid an extra $1,026 in taxes to make up for tax havens by corporations and wealthy individuals. The average small business paid $3,067.

5 .Paralyzing the Voters

Corporations and Congress are a carcinogenic mix. Voters are rendered useless, like withering organs, as all the attention is given to the greedy mass of nutrient-taking super-rich individuals and companies.

A vast majority of Americans want background checks [31] on guns, an emphasis [32] on clean energy [33], job stimulus [34] programs, taxes on the rich [35], and an uncut Social Security [36] program. Yet Congress only hears the ka-ching of campaign contributions. Of the 435 House elections [37] in 2004, 95% of them were won by the candidates who outspent their opponents.

Healing

There's much more to the sickness, like the workplace explosions and fires triggered by cost-cutting measures, banks preying [38] on working people, the environmental [39] destruction caused by oil companies [40] and herbicide [41] manufacturers, attempts [42] to profit [43] from global warming, the middle class collapse caused by corporations transferring jobs overseas and then calling themselves multi-nationals to avoid allegiance to the country that supported their growth. Et cetera, et cetera.

This all allows a small number of people to make most of the money. These are the people who demand 'freedom' at the first hint of regulation.

The post-WW2 American body began to deteriorate around the time of Milton Friedman, author of one of the all-time economic inaccuracies: "The free market system distributes the fruits of economic progress among all people." For forty years the sickness caused by his teaching has spread, at first without pronounced symptoms, but now in an out-of-control process that threatens to incapacitate the better part of America. A revolutionary medicine may be the only hope for recovery. A revolution, that is, of co-ops and small farms and local currencies and solar panels on the rooftops.

[4] http://www.cbpp.org/cms/index.cfm?fa=view&id=1269
[5] http://www.usagainstgreed.org/Fortune400_2011-12.xls
[6] http://www.cbpp.org/cms/?fa=view&id=3239
[7] http://www.ers.usda.gov/media/884525/err141.pdf
[8] http://www.fns.usda.gov/Ora/menu/Published/SNAP/FILES/Participation/2011Characteristics.pdf
[9] http://www.commondreams.org/view/2013/03/09
[10] http://www.obpa.usda.gov/budsum/FY13budsum.pdf
[11] http://www.capitalpress.com/content/jh-farm-bill-details-042913
[12] http://www.pewsocialtrends.org/2012/09/26/a-record-one-in-five-households-now-owe-student-loan-debt/
[13] http://www.deltacostproject.org/pdfs/Delta_Not_Your_Moms_Crisis.pdf
[14] http://www.businessweek.com/articles/2013-04-15/how-obama-wants-to-change-student-loan-interest-rates
[15] http://www.nelp.org/page/-/Job_Creation/LowWageRecovery2012.pdf?nocdn=1
[16] http://blogs.wsj.com/economics/2013/03/30/number-of-the-week-college-grads-in-minimum-wage-jobs/
[17] http://chronicle.com/article/From-Graduate-School-to/131795/
[18] http://www.alternet.org/college-students-are-going-homeless-and-hungry-and-corporate-america-trying-exploit-them?paging=off
[19] http://www.businessweek.com/magazine/content/10_19/b4177064219731.htm
[20] http://www.huffingtonpost.com/2013/04/24/lawmaker-unemployment-hearing_n_3148362.html
[21] http://www.oecd.org/els/health-systems/oecdhealthdata2012-frequentlyrequesteddata.htm
[22] http://www.unicef-irc.org/publications/pdf/rc9_eng.pdf
[23] http://www.childrensdefense.org/child-research-data-publications/data/soac-2012-handbook.pdf
[24] http://www.oecd.org/dataoecd/19/4/43570328.pdf
[25] http://www.taxpolicycenter.org/UploadedPDF/412404-Tax-Expenditure-Trends.pdf
[26] http://finance.yahoo.com/news/irs-estimate-17-percent-taxes-204637410.html
[27] http://www.payupnow.org/CorpTaxByYear.xls
[28] http://www.taxjustice.net/cms/upload/pdf/Price_of_Offshore_Revisited_120722.pdf
[29] http://www.taxjustice.net/cms/upload/pdf/Inequality_120722_You_dont_know_the_half_of_it.pdf
[30] http://www.uspirg.org/news/usp/offshore-tax-havens-cost-average-taxpayer-1026-year-small-businesses-3067
[31] http://www.washingtonpost.com/blogs/the-fix/wp/2013/04/03/90-percent-of-americans-want-expanded-background-checks-on-guns-why-isnt-this-a-political-slam-dunk/
[32] http://www.alternet.org/environment/how-country-one-worlds-largest-economies-ditching-fossil-fuels?paging=off
[33] http://www.gallup.com/poll/161519/americans-emphasis-solar-wind-natural-gas.aspx
[34] http://www.gallup.com/poll/158834/economy-entitlements-iran-americans-top-priorities.aspx
[35] http://www.huffingtonpost.com/2012/11/28/taxing-the-rich-poll_n_2203400.html
[36] http://www.politico.com/story/2012/12/battleground-poll-hike-taxes-on-the-rich-84824.html
[37] http://www.opensecrets.org/news/2004/11/2004-election-outcome-money-wi.html
[38] http://www.alternet.org/economy/rich-have-gained-56-trillion-recovery-while-rest-us-have-lost-669-billion?paging=off
[39] http://www.thenation.com/article/164497/capitalism-vs-climate?page=full
[40] http://itsoureconomy.us/2013/02/oil-sands-mining-uses-up-almost-as-much-energy-as-it-produces/
[41] http://www.biosafety-info.net/article.php?aid=267
[42] http://www.alternet.org/environment/cynical-companies-are-already-scheming-how-getting-rich-global-warming?paging=off
[43] http://www.businessweek.com/articles/2013-03-07/investors-seek-ways-to-profit-from-global-warming

Rampant Capitalism Has Created a Social Disaster How Do We Right the Ship? Bill Moyers

Open source ecology explained

"Open Source Ecology founder Marcin Jakubowski and the OSE team explain the philosophy behind their work and the open source movement as a whole. We're always looking for remote collaborators to pick up and run with our designs. If you're interested in building or improving on our work, please visit the OSE wiki."

Open Source Philosophy.

UNDERSTANDING THE FISCAL CLIFF (In 2 minutes, 30 seconds)

from Richard Metzger at DangerousMinds

I’m getting so sick and tired of hearing about the so-called “fiscal cliff” except for the heartening rising chorus of rational voices in the matter—like former Clinton administration Secretary of Labor Robert Reich—who stick to their guns about how to deal with it.

Let’s face it, to go by 2009 and the debt ceiling brouhaha, Obama is one fucking shitty negotiator. Unless there is tons of public pressure put on him to do the right thing, I fear he’ll cave in to the Republicans on raising the retirement age, only modestly raising taxes on the rich and cutting social safety nets. Don’t trust Obama, put lots and lots of pressure on him.

House Speaker John Boehner today made a counteroffer in the negotiations including proposals to increase the Medicare eligibility age and cut Social Security benefits. Forget about the GOP, they’re a lost cause, apply the pressure where it might make a difference, on Obama and the Democrats.

Find the necessary savings in corporate welfare and in the bloated military budgets, it’s the only acceptable path (and one with a whole lot of knock-on effect WIN along the way).

Although Reich addresses his essay to Democrats, I’d prefer to think of this as appealing to every American who isn’t a fucking idiot…

Democrats, here are eight principles to guide you in the coming showdown over the fiscal cliff:

ONE: HOLD YOUR GROUND. The wealthy have to pay their fair share of taxes. That’s what the election was all about, and we won. It’s only fair they pay more. They’re taking home record share of national income and wealth, and have lowest effective tax rate in living memory.

TWO: NO DEAL IS BETTER THAN A BAD DEAL. You’re in a strong bargaining position. If you do nothing, the Bush tax cuts automatically expire in January, and we go back to rates during Clinton administration. Which isn’t such a bad thing. As I recall we had a pretty good economy during the Clinton years.

THREE: MAKE REPUBLICANS VOTE ON EXTENDING THE TAX CUTS JUST FOR THE MIDDLE CLASS. After all the Bush tax cuts expire, have Republicans vote on an extending the Bush tax cut just for the middle-class. If they refuse and try to hold those tax cuts hostage to tax cuts for the wealthy, it will show whose side they’re on. They’ll pay the price in 2014.

FOUR: DEMAND HIGHER TAX RATES ON WEALTHY, NOT JUST LIMITS ON DEDUCTIONS. Don’t fall for Republican offers to limit some tax deductions on the wealthy. Demand we go back to higher tax rates on the wealthy and eliminate their unfair tax loopholes, so they truly start paying their fair share.

FIVE: DON’T CUT SAFETY NETS. Don’t sacrifice Medicare or Social Security, or programs for the poor. Americans depend on these safety nets and can’t afford any benefit cuts.

SIX: DON’T CUT INVESTMENTS IN OUR FUTURE PRODUCTIVITY. Education, basic R&D, and infrastructure aren’t spending; they’re investments in our future prosperity. If the return on these investments is greater than the cost, they ought to be made, period.

SEVEN: CUT SPENDING ON MILITARY AND CORPORATE WELFARE. You want to cut, cut spending on the military — which now exceeds the military spending of the next 13 largest military spenders in the world combined. And cut corporate welfare — support to agribusiness, oil and gas, Big Pharma, big insurance, and Wall Street.

EIGHT: PUT JOBS BEFORE DEFICIT REDUCTION. Finally, Don’t cut the budget deficit as long as unemployment remains high. Otherwise you’ll cause the economy to contract, making the deficit even larger in proportion. That’s the austerity trap Europe has fallen into. We need to create American prosperity, not European austerity.

Remember: Jobs come first.

Hear, hear! Please spread this message far and wide

Don't Fall for the Right's "Fiscal Cliff" Hysteria

The oldest trick in the book is for conservatives to create hysteria over something so they can swoop in with right-wing solutions.

from AlterNet By Thom Hartmann

They’re up to it again – this time with what they call the “fiscal cliff.” Beware of con men bearing slogans. The oldest trick in the book is for conservatives – cons – to create hysteria around something, and then get all of us to give them billions of our tax dollars to fix the problem they’ve gotten us all hysterical about. Four generations ago, the right was whipping up hysteria about Reefer Madness. They got us to spend trillions over the years incarcerating mostly poor people for a mostly victimless crime. But they made a fortune doing it! And now they’re even building private prisons to hold potheads. Three generations ago, the right was whipping up hysteria about Communism.

Although Khrushchev never actually said, “We will bury you,” right-wingers and their PR machine made sure every American thought he did. And the Red Chinese were going to take down Vietnam and that domino would flip other countries from Laos to Canada – and pretty soon North Dakota would be filled with commies. They got us to spend trillions over the years building nukes and having pointless wars. But they made a fortune doing it! And now that they’re making money partnering with China, they’d like us to forget that it’s still officially a communist country. No droids in this car!

Two generations ago, the right was whipping up hysteria about taxes and regulation. Reagan told us that – even though the decades of the 50s, 60s, and 70s had been among the strongest in American history in terms of GDP growth and growth of the middle class – still, taxes on rich people were so high, and regulation of industry was so bad, that if we didn’t do something about it now, disasters would happen. They got us to spend trillions giving tax breaks to billionaires, and deregulated giant corporations so they could destroy most small and medium-sized American businesses in the great Mergers and Acquisitions frenzy. But they made a fortune doing it! And in this generation, the right is whipping up hysteria about our national debt.

They want us to be afraid, very afraid, that because of their war on drugs, their war on communism, and their war on taxes and regulation, our country now is trillions of dollars in debt. It becomes particularly ironic when they get hysterical about a program that goes into effect at the end of this year that will modestly raise taxes back to where they were when Bill Clinton was president, and will cut spending, particularly military spending, although not even close enough to take us back to where it was before Bush.

They call this the “fiscal cliff,” as if it’s something we could fall over the edge of and die from the crash. But it’s all hysteria. The tax increases on middle class people are easily remedied with a tax cut – something Republicans say they love. And the spending cuts sound like a lot – over a trillion dollars – but that’s over the next ten years.

That’s plenty of time to go through those things and decide which is important, like keeping long-term unemployment benefits flowing, and which can wait, like building more bombs. In other words, the “fiscal cliff” is another classic example of what Naomi Klein called “Disaster Capitalism.” Create a panic, and then profit from it. For example, Wall Street is helping fund groups like the Third Way that are pushing hard for us to give our Social Security Trust Fund – which has over two and a half trillion dollars in it – to Goldman Sachs and Citibank so they can take care of it for us. Doesn’t that make you feel all safe, and warm-and-fuzzy? While we have a large debt, it’s not as large as it was after World War II. And how did we solve it then?

Presidents Truman and Eisenhower – a Democrat and a Republican – both realized it wasn’t a “cliff” or a debt problem: it was a jobs problem. So they invested billions of dollars in sending millions of Americans to college for free, and billions more in building highways, schools, and hospitals. Those investments paid off in more and better jobs, which meant more taxpayers, which meant more tax revenue.

As if by magic, the World War Two debt was paid off! We need to change the conversation. We don’t have a “fiscal cliff” to worry about – we have a jobs cliff. Giant corporations and their conservative buddies have been sending those jobs overseas as fast as they can, and, while it’s making the fat cats rich, it’s wiping out the middle class. It’s time for a national conversation about our insane trade policies and how we can grow real jobs, not just fast-food jobs. No fiscal cliff or grand bargain needed – let’s just put Americans back to work.

How a Loan Between Friends Can Destroy the Relationship

from Alternet By Anneli Rufus :

Asking friends for loans is like asking them for sex: Whatever happens, the relationship will never be the same again.

At this point in history, money holds such massive emotional baggage that asking Can I have some of yours for a while? or Will I ever get it back? are some of life's weightier questions.

And now, we the people -- underwater, unemployed and terrified -- are forced ever more into the position of borrowing and lending among ourselves. Facing increasing personal financial crises, many of us now gaze dollar-sign-eyed at those with whom we lunched and shopped and shared secrets in gladder times.

When friends ask friends for loans, what's really being asked? What's the emotional "interest" on such loans -- and can friendships survive them?

Ella Hodges had three kids and worked part-time for a law firm when her husband's business failed in 2010. For the first time in her life, she needed to borrow money. But from whom?

"I knew that my friend Bree had a lot of money, and I knew she would say yes," Hodges remembers. "She knew I had always been very fiscally careful, so she trusted me. But how could I put Bree into the position of worrying that maybe the payback might never come? How could I put that burden on our friendship?"

Debating endlessly what she calls "the ask," Hodges thought about a neighbor who had run into hard times.

"She received numerous $1,000 loans from fellow church members who, when they later saw her at McDonald's or the movies, were clearly thinking: 'Sarah, is this really the best use for my money?'"

Borrowing from banks has its downsides, "but money loaned between friends is not free of strings. It's not clean. Conditions are imposed either implicitly or explicitly that give the giver a permanent one-up over the getter," Hodges says. "One friend will always be high, the other low, and someone will always feel judged. Borrowing money from Bree would make her my banker. She could then justifiably scrutinize every decision I made. If she loaned me money, then asked me out for drinks, should I not drink? If I buy a car, does she get to choose it?

"I'm a very self-conscious person. Others aren't. They wouldn't share my concerns about borrowing money or spending it."

Tory Fisk learned this when his friend, a laid-off computer programmer we will call Jed, asked Fisk last year for an $800 loan.

To music-teacher Fisk, $800 was a lot. "Friends are usually in the same economic class as each other, so if you ask your friend for money, that friend is probably not going to be some cavalier Richie Rich smoking solid-gold cigars. It'll be someone to whom the amount of money you're requesting seems substantial."

Having always earned more than Fisk, Jed spent freely -- "so we always had the same amount: not much. And always assuming that he would always be employed, he eventually realized that he wouldn't."

Jed told Fisk he needed the $800 "for essentials like food," and promised to repay it in $50 monthly installments.

"In typical scam-artist fashion, he lavished me with praise: 'You're my best friend in the world.' So you feel guilty for not wanting to give. Also in typical scam-artist fashion, he said, 'If the situation was reversed, I would do it for you.' But the situation never would be reversed. So of course he could make these grand promises that he knew he would never need to keep," Fisk says.

Fisk loaned Jed the money.

Jed missed the first payment, then the next. One day Fisk was startled to see Jed "wearing a fancy new suit. He said that when you're down and out, you need good clothes to impress potential future employers.

"With every missed payment, I found myself feeling more and more critical about his lifestyle. It was like, if I'm supporting you, then I have a stake in your choices. You're supposed to use that money to get back on your feet -- not enjoy yourself," Fisk seethes.

It angered Fisk that Jed refused to seek work in any field besides programming.

"He said he wouldn't lower himself. Suddenly, every little thing he did made me incredibly annoyed. He'd invite me out and when I said no, he'd offer to pay my way. Right -- pay my way with my money. How generous."

Eventually, Jed stopped mentioning the loan. No more apologies or promises to pay double or triple next time.

"He probably assumed it was forgotten and that since it was forgotten, it was forgiven," Fisk says. "But in fact it was a festering sore. To me, $800 is a lot of money. It's not like a cup of sugar loaned to your neighbor."

Jed's changed situation -- jobless, indebted -- "didn't change his personality," Fisk says. "It didn't imbue him with responsibility."

As a last-ditch effort, Fisk created a small business with Jed.

"His carelessness ruined the business. That, along with never repaying the loan, ended our friendship."

Every human relationship has its boundaries and taboos. If sex and money are our culture's twin obsessions, both wreak similar havoc on friendships. Asking friends for loans is not unlike asking them for sex: Whatever the answer, the relationship changes forever -- typically in a haze of guilt, shame and regret.

The size of a loan that one friend requests from another puts a neon price tag on that friendship. Is a new iPad worth more to you than a roof over my head?

After Rose Guinne lost her job, "I had no choice but to borrow money. I had always prided myself on being able to pay my bills," but for the first time in her adult life, "I had no savings, no way of earning extra cash. I was embarrassed to approach my parents because I wanted to be able to demonstrate my independence.

One day Guinne ran into a friend we will call Howard. Twenty years her senior, he asked in a fatherly way why she seemed so sad.

"So I told him. ... Then it just burst out of me; I said, 'I know it's a lot of money, but is there any way you'd have $300?' ... I was ashamed. I had always wanted to project the image of a good businessperson and I felt I had failed."

Howard wrote her a $300 check.

"I had been brought up to know that my actions were and are accountable, so I said, 'Let's draw up an agreement and we'll each have a copy,'" Guinne recalls.

They drafted and signed it on the spot.

"It was to be paid back in installments at no interest, with a particular target date. If there was a delay in payment it had to be agreed upon by both parties.

“Howard smiled at me -- I’ll never forget that smile -- and said, 'I trust you.'

"Every two weeks, I’d hand him a check and we noted on our agreements what had been paid and what the remaining balance was. We were like two business associates doing this, and we even laughed about it.

"Because we handled it in a businesslike manner and were professional about it, our friendship remained very much on track -- as a matter of fact, even more so, because he knew he could trust me and I could trust him. Trust is so important," Guinne says.

True. That's why Ella Hodges decided not to ask Bree for a loan after all.

"Our response when a friend asks us for a loan reveals our true feelings about that person," Hodges says. "You can cloak your answer in whatever terms you want, but it reveals either that you think they'll pay it back or that they won't. There might be good reasons for either thought, but as soon as you have to confess this by saying no, it's horrible."

Hodges borrowed money from a relative instead. Nor did she ever cash the check that another caring person had given her.

"I kept it in my wallet for a long time, just in case," Hodges says. "Then I gave it back."

Why does France’s new Socialist President strike fear into the hearts of the elites?

from Richard Metzger at DangerousMinds:

Hearty congratulations to the entire country of France for having the good sense to elect a Socialist president, François Hollande, and for kicking that pompous dickhead Sarkozy to the curb.

It’s not like the “Socialist” part—or even President-Elect François Hollande himself for that matter—got much play in the initial reports in the American media, although “Farewell Monsieur President!” and “Goodbye Sarkozy!” headlines were in abundance (I’d have gone with something like “France tells ‘President of the rich’ to piss off, elects Socialist”). Hollande will be the country’s first Socialist leader since François Mitterrand (the Republic’s longest-serving president) left office in 1995. It was Hollande’s ex-wife, Socialist politician Ségolène Royal, who was defeated by Nicolas Sarkozy in 2007.

MSNBC, not mentioning Hollande in the headline, and under a picture of a dejected looking Sarkozy, natch, called the President-Elect “unassumming.” When reporters did get around to mentioning Hollande by name, it was normally to mention that he was a “socialist lite” or a “moderate.”

By American political standards? That’s a pretty meaningless and worthless comparison, if you ask me.

To take the President-Elect at his own word, his win represents “a new departure for Europe and hope for the world” because “Europe is watching us, austerity can no longer be the only option.” I personally like the way that sounds, but Lynn Parramore, writing at AlterNet fears that Hollande will end up being a “marshmallow” who talks big and then lets monied interests walk all over him (where have we seen that happen before?). She also describes him as “more like an American centrist Democrat than a Bush-style right-winger,” but I’d take that with a grain of salt (see below).

Nabila Ramdani bucked the trend writing in The Independent, calling Hollande a “fiercely left-wing leader” who would “strike fear into the hearts of France’s rich” and who should not be written-off before he even takes office on May 17th.

The 57-year-old Socialist has openly admitted that he “does not like the rich” and declared that “my real enemy is the world of finance”. This means taxing the wealthy by up to 75 per cent, curtailing the activities of Paris as a centre for financial dealing, and ploughing millions into creating more civil service jobs.

Add an explicit threat to renegotiate the euro pact to replace austerity with “growth-creating” spending, and you have one of the most vehemently left-wing programmes in recent history.

BUT… There’s always a “but” isn’t there? France is broke and mired deeply in debt. Servicing the country’s outstanding debt is the second item of the government’s yearly budget, right below healthcare:

Caution is justified, though one thing Mr Hollande will not repeat is the disastrous tax-and-spend policies introduced by France’s last Socialist President, François Mitterrand, in 1981. He was soon forced into a humiliating U-turn, and into sharing power with the right as the Communists quit his cabinet in protest.

In contrast, Mr Hollande will focus on solving the euro crisis and reversing a Gallic economic decline widely blamed on a failed capitalist system, and particularly a rotten banking sector.

A summary of Holland’s policies and proposals, according to Wikipedia, demonstrates just how very little a President Hollande would have in common with “an American centrist Democrat” (no matter what Sean Hannity might think!)

Foreign policy: supports the withdrawal of French troops present in Afghanistan by the end of 2012.

European politics: aims to conclude a new contract of Franco-German partnership and he advocates the adoption of a Directive on the protection of public services. Proposes closer Franco-German partnership: “an acceleration of the establishment of a Franco-German civic service, the creation of a Franco-German research office, the creation of a Franco-German industrial fund to finance common competitiveness clusters (transport, energy or environment) and the establishment of a common military headquarters.”

Financial system: backs the creation of a European rating agency and the separation of lending and investment in banks.

Energy: endorses reducing the share of nuclear power in electricity generation from 75 to 50% in favor of renewable energy sources.

Taxation: supports the merger of income tax and the General Social Contribution (CSG), the creation of an additional 45% for additional income of 150,000 euros, capping tax loopholes at a maximum of €10,000 per year, and questioning the relief solidarity tax on wealth (ISF, Impôt de Solidarité sur la Fortune) measure that should bring €29 billion in additional revenue.

Education: supports the recruitment of 60,000 new teachers, the creation of a study allowance and means-tested training, setting up a mutually beneficial contract that would allow a generation of experienced employees and craftsmen to be the guardians and teachers of younger newly-hired employees, thereby creating a total of 150,000 subsidized jobs.

Aid to SME’s, with the creation of a public bank investment-oriented SME’s and reducing the corporate tax rate to 30% for medium corporations and 15% for small.

Recruitment of 5,000 judges, police officers and gendarmes.

Construction of 500,000 homes per year, including 150,000 social, funded by a doubling of the ceiling of the A passbook, the State making available its local government land within five years.

Restoration of retirement at age 60 for those who have contributed more than 41 years.

Hollande supported same-sex marriage and adoption for LGBT couples, and has plans to pursue the issue in early 2013.

The provision of development funds for deprived suburbs.

Return to a deficit of 0% of GDP in 2017.

This is “moderate”? Sounds pretty “sane” to moi.

Appropriately, Hollande’s jubilant left-wing supporters took their joyous celebrations to la Place de la Bastille where the Socialist President Elect spoke:

“I don’t know if you can hear me but I have heard you. I have heard your will for change. I have heard your strength, your hope and I want to express to you all of my gratitude. Thank you, thank you, thank you people of France, gathered here, to have allowed me to be your president of the republic.”

“I am the president of the youth of France! I am the president of all the collective pride of France! I am the president of Justice in France!

“Carry this message far! Remember for the rest of your life this great gathering at the Bastille because it must give a taste to other peoples, to the whole of Europe, of the change that is coming. In all the capitals, beyond government leaders and state leaders, there are people who, thanks to us, are hoping, are looking to us and want to put an end to austerity.”

Liberté, égalité, fraternité!
 

The Story of Broke

TRANSCRIPT

These last few years, I’ve had to get a lot more careful about how I spend my paycheck. Everyone has. Like I’m eating out less often, holding back on expenses I don’t really need, saving for my kid’s college.

I’m getting more responsible, taking control of how I spend.

But one thing I can’t control is that every month a big chunk of my paycheck goes off to the government.

It’s not the most fun part of my budget, but I believe in paying taxes.

Not just because it’s the law but because that’s how
I invest in a better future that I can’t afford to build on my own.

You know that future we all want and nearly every candidate promises us — great schools, a healthy environment, clean energy, good jobs.

But a funny thing happens to our money on its way to that better future. It seems to disappear.

And by the time we get around to investing in it, all we hear is, “sorry, not this year, we’re broke.”

In fact, we’re so broke, they say, that we have no choice but to slide backwards, cutting things that made this country great — like schools and the EPA , maybe even Social Security and Medicare.

Wait a minute. Broke? I’m sending in my share of hard-earned cash every month and so are you!

Now, what we’ve got to work with shrinks a lot thanks to corporate tax loopholes and unprecedented tax breaks for the richest 1%.

But even after those, we’ve still got over a trillion dollars.

So if we’re broke, what’s happening to all that money?
I decided to look into it and it turns out this whole “broke” story hides a much bigger story — a story of some really dumb choices being made for us — but that actually work against us. The good news is that these are choices, and we can make different ones.

So, where is all that money going?

Well ?rst the military takes a big chunk – $726 billion in 2011.

Wow! We could build a lot of better future with that kind
of money.

Spending billions on ?ghter planes we don’t need or wars with no end, and then saying we’re broke, just isn’t honest. It’s like calling your kid from your billion-dollar yacht to say you can’t afford her lunch money.

Then hundreds of billions more go to propping up the dinosaur economy. You know, the obsolete system we talked about in The Story of Stuff — the one that produces more pollution, greenhouse gasses and garbage than any other on Earth — and doesn’t even make us happy. In so many ways, it’s just not working, but we’re keeping it in on life support instead of building something better.

A lot of that life support comes in the form of subsidies.

A subsidy is a giveaway that gives some companies a lift over others. That’s not necessarily a bad thing — we should help companies that are building a better future. The problem is the government keeps lifting up companies that are actually dragging us down.

Everywhere you look along the dinosaur economy, you’ll ?nd these subsidies.

There’s spending subsidies: where the government just gives our money away — like payments that bene?t big agribusiness, while helping drive family farms off a cliff.

Or the less obvious version where the government foots the bill for things corporations should pay for themselves like cleaning up toxic chemical spills or giant livestock manure ponds.

Or building roads that go to only one place — a new Walmart.

Or paying for polluting and wasteful garbage incinerators that would never make ?nancial sense to build on their own.

Then there’s tax subsidies: which excuse big corporations from contributing their fair share — like the enormous tax breaks granted to oil and gas companies even in times of record pro?ts.

These subsidies amount to billions of dollars we should be collecting and putting to good use.

And there’s risk transfer subsidies: where the government acts as an investment bank and even an insurance company for corporations doing risky things, like building nuclear reactors.

If anything goes wrong, we have to cover for them.

There’s freebie subsidies: where the government gives stuff that belongs to all of us to corporations for cheap or even free. That’s billions more we should be collecting but never see! Like permits to mine public lands, granted at prices set
in the Mining Law of 1872.

Really. 1872. President Grant signed this law to encourage settlement of the West. News ?ash: it’s settled.

And all this doesn’t even count externalized costs. They don’t show up on any spreadsheet and could amount to trillions of dollars — they include the damage to the environment, public health and the climate that this dinosaur economy causes. Without laws that make the polluters pay, we all pay with the loss of clean water and air, or increased asthma and
cancer.

By the time we’ve handed out all these subsidies, there isn’t even enough money to pay our bills — forget about building
the better future.

So why is there always enough money for the dinosaur economy, from big oil to bailouts for big banks, but when it comes to building a better future we’re supposedly broke? Maybe it’s because these guys know how to ask for it.

Their lobbyists and giant campaign contributions let the government know what they want, and what they’ll do if they don’t get it. And it works. US Senators who voted to keep big oil subsidies in 2011 had received 5 times more in Big Oil campaign cash than those who voted to end them.

So, while subsidies should be a tool for government to help companies that are helping all of us, instead, they’ve become a prize for those with the most power to get on the handout list.

But you know who has the real power? We do! What if we got as protective of our tax dollars as we are with the rest of our money? What if we told the government what we want and what we’ll do if we don’t get it – starting with voting them out!

We could re-direct these dinosaur subsidies, freeing up hundreds of billions of dollars. Forget broke, we could build a
better future right now!

We could start by reinvesting the $10 billion in oil and gas subsidies
to renewable energy and energy ef?ciency projects.

With just half of that amount, we could put solar systems on over two million rooftops. Then use the rest to retro?t half a million homes, creating jobs and saving energy year after year.

The average cost of cleaning up a toxic site on the Superfund list is $140 million.

Let’s make the polluters pay and instead invest our money in developing safer materials so we don’t have to worry about them spilling in the ?rst place.

Most chemicals today are made from oil — that’s why they are called petro-chemicals. Switching just 20% of them to biobased materials would create over 100,000 new jobs.

Instead of subsidizing garbage incinerators, let’s subsidize real solutions, like zero waste.

Raising the US recycling rate to 75% would create one and a half million new jobs — with less pollution, less waste, less pressure to harvest and
mine new stuff. What’s not to like?

That would still leave hundreds of billions of dollars for improving education — the best investment for a healthy
economy. With $100 billion, we could increase the number of elementary school teachers by over 40% and give college scholarships to over 6 million students.

See, we can rebuild the American Dream; we can afford to have a healthy environment, good jobs, and top-notch public education. But not if we continue subsidizing the dinosaur economy.

So next time you have an idea for a better future and someone tells you, “that’s nice, but there’s no money for that,” you tell them we’re not broke.

There is money, it’s ours, and it’s time to invest it right.

Economic inequality in America: how bad is it?

from Xeni at BoingBoing



Real bad. On PBS NewsHour last night, correspondent Paul Solman went to the line outside the Letterman show in NYC and showed people three different pie charts representing the possible distribution of wealth in three different countries. Most people figured the most equal of those was the US. It wasn’t. The US was the most unequal: the top 20% own 84% of the wealth in America, and the bottom 40% have only 0.3%. Land of the increasingly screwed, more like it.

Watch video here (or at YouTube)

Shock Doctrine: How Conservatives and Corporate Elites Are Stoking Economic Hysteria to Force Catastrophic Cuts

from AlterNet By Robert L. Borosage, Blog for Our Future

Global economic turmoil is getting worse. Europe’s financial crisis now imperils Spain and Italy. The folly of premature austerity savages economies in Great Britain, Europe and, increasingly, the United States. China and the emerging economies are slowing down. This economy seems stalled at best. People are sensibly scared, worried about their jobs, their homes, their lost savings, their prospects.

Conservative and corporate elites are stoking the turmoil, and using fear to panic a public into accepting harsh measures that would be otherwise unacceptable. The stock market tanks after the debt ceiling debacle. Standard & Poor's, the discredited and corrupted rating agency, rushes to downgrade U.S. debt, with such haste it doesn’t even get its math right. China’s news service announces the U.S. must roll back its bloated “welfare state” and its bloated military. The talk shows are inundated with pundits expounding the urgent need for the U.S. to get its deficits under control to regain its credit status.

One theme emerges; the Gang of 12 – the Super Committee created in the debt ceiling deal – is portrayed as our last hope. It is charged with identifying $1.5 trillion in deficit reduction over 10 years by some combination of cuts from Medicare, Medicaid and Social Security and increased tax revenues. Only if it acts responsibly, we’re told, and the Congress passes its measures under expedited procedures with no amendments, limited debate, and no filibuster, do we have a chance.

Pressure builds on the congressional leaders to pick responsible legislators to the committee, like the previous Gang of Six in the Senate, who will combine cuts in Social Security and Medicare with increased revenues. Republican leaders pledge to appoint members who will oppose any increase in taxes on the rich or the great corporations. Medicare, Medicaid and Social Security – the core promises we make to the elderly, the disabled, the dying – in our society are at risk. In an era of Gilded Age extremes of inequality, the largest and most effective anti-poverty programs are targeted for deep cuts.

Ignore the hysteria. Fight back against the shock doctrine. All of this is utterly wrong-headed. America doesn’t have a serious debt crisis. We have a jobs crisis. We’re digging out of a severe financial collapse and need to build a new foundation for the economy, for we can’t go back to the old economy that was built on debt and bubbles.

In the long term, the scary deficit projections are almost completely due to our broken health care system. Make reforms that move us closer to the norm of industrial countries in health care costs and we have no long-term debt problem. That requires taking on drug companies, private insurance companies, hospital complexes, the inane way we let powerful interests rig the rules for their profit. We’ve got to get the costs under control, not push the rising costs onto the most vulnerable.

In the short term, we need a strategy for reviving the economy so that it works for working people. That requires a serious strategy for making things in America again, combined with a commitment to balance our trade, confronting the mercantilist nations like China that trample global trading rules. It requires incentives and investments to capture a lead role in the green industrial revolution, moving to clean energy and reducing our dependence on foreign oil while addressing catastrophic climate change. It requires investment in strengthening the sinews of growth – investments in education and training, in research and development, in innovation, as well as building a modern infrastructure for the next century, updating the decrepit systems now crumbling around us. With interest rates near zero, despite the hyped rating agency fandango, there has never been a better time to borrow long term to build now.

Fight Back

The elite roll-out is clear. The gang of 12 produces a “deal,” combining a hike in eligibility age for Medicare, a cut in Social Security by reducing the inflation adjustment, caps on Medicaid and increased revenues from LOWERING rates on the corporations and the rich, while limiting deductions that reach middle-class families – on mortgages, employer based health care or retirement plans. They may well throw in the current scam – funding the infrastructure bank with proceeds from allowing multinationals who have secreted a trillion on profits offshore to bring the money back at a cut-rate 5 percent.
Yes, the panic will be used to cut the basic promises made to working families in order to pay for the deficits caused by the excesses of Wall Street.

Don’t fall for it. Fight back. On August 9, Republican state senators in Wisconsin who sought to trample basic worker rights are facing recall elections. On August 10, the American Dream Movement, supported by Moveon.org, the Center for Community Change, and the Campaign for America’s Future and others, will sponsor events across the country. Citizens will be taking the new Contract for the American Dream to their legislators, and demanding action on jobs, not on cuts.

Legislators across the country will face constituents saying, “We are all Wisconsin now. Start doing the people’s business or you too will face a challenge to your re-election." August must generate enough street heat to supplant the hysteria now coming to you wall to wall over the mainstream media.

The right and their corporate sponsors want to use the lousy economy to strike – to roll back the already inadequate supports that exist for working families. They are even aiming at Social Security, which is in surplus and contributes nothing to the deficit. Don’t let them destroy the American dream. Join the movement that will lead the fight back.

Robert Borosage is co-director of the Campaign For America's Future, and he has written on political, economic, and national security issues for publications including The New York Times and The Nation.

© 2011 Blog for Our Future All rights reserved.

30 Years Ago Today: The Day the Middle Class Died ...a letter from Michael Moore‏

from Michael Moore's mailing list:

Friday, August 5th, 2011



Friends,

From time to time, someone under 30 will ask me, "When did this all begin, America's downward slide?" They say they've heard of a time when working people could raise a family and send the kids to college on just one parent's income (and that college in states like California and New York was almost free). That anyone who wanted a decent paying job could get one. That people only worked five days a week, eight hours a day, got the whole weekend off and had a paid vacation every summer. That many jobs were union jobs, from baggers at the grocery store to the guy painting your house, and this meant that no matter how "lowly" your job was you had guarantees of a pension, occasional raises, health insurance and someone to stick up for you if you were unfairly treated.

Young people have heard of this mythical time -- but it was no myth, it was real. And when they ask, "When did this all end?", I say, "It ended on this day: August 5th, 1981."

Beginning on this date, 30 years ago, Big Business and the Right Wing decided to "go for it" -- to see if they could actually destroy the middle class so that they could become richer themselves.

And they've succeeded.

On August 5, 1981, President Ronald Reagan fired every member of the air traffic controllers union (PATCO) who'd defied his order to return to work and declared their union illegal. They had been on strike for just two days.

It was a bold and brash move. No one had ever tried it. What made it even bolder was that PATCO was one of only three unions that had endorsed Reagan for president! It sent a shock wave through workers across the country. If he would do this to the people who were with him, what would he do to us?

Reagan had been backed by Wall Street in his run for the White House and they, along with right-wing Christians, wanted to restructure America and turn back the tide that President Franklin D. Roosevelt started -- a tide that was intended to make life better for the average working person. The rich hated paying better wages and providing benefits. They hated paying taxes even more. And they despised unions. The right-wing Christians hated anything that sounded like socialism or holding out a helping hand to minorities or women.

Reagan promised to end all that. So when the air traffic controllers went on strike, he seized the moment. In getting rid of every single last one of them and outlawing their union, he sent a clear and strong message: The days of everyone having a comfortable middle class life were over. America, from now on, would be run this way:

* The super-rich will make more, much much more, and the rest of you will scramble for the crumbs that are left.

* Everyone must work! Mom, Dad, the teenagers in the house! Dad, you work a second job! Kids, here's your latch-key! Your parents might be home in time to put you to bed.

* 50 million of you must go without health insurance! And health insurance companies: you go ahead and decide who you want to help -- or not.

* Unions are evil! You will not belong to a union! You do not need an advocate! Shut up and get back to work! No, you can't leave now, we're not done. Your kids can make their own dinner.

* You want to go to college? No problem -- just sign here and be in hock to a bank for the next 20 years!

* What's "a raise"? Get back to work and shut up!

And so it went. But Reagan could not have pulled this off by himself in 1981. He had some big help:

The AFL-CIO.

The biggest organization of unions in America told its members to cross the picket lines of the air traffic controllers and go to work. And that's just what these union members did. Union pilots, flight attendants, delivery truck drivers, baggage handlers -- they all crossed the line and helped to break the strike. And union members of all stripes crossed the picket lines and continued to fly.

Reagan and Wall Street could not believe their eyes! Hundreds of thousands of working people and union members endorsing the firing of fellow union members. It was Christmas in August for Corporate America.

And that was the beginning of the end. Reagan and the Republicans knew they could get away with anything -- and they did. They slashed taxes on the rich. They made it harder for you to start a union at your workplace. They eliminated safety regulations on the job. They ignored the monopoly laws and allowed thousands of companies to merge or be bought out and closed down. Corporations froze wages and threatened to move overseas if the workers didn't accept lower pay and less benefits. And when the workers agreed to work for less, they moved the jobs overseas anyway.

And at every step along the way, the majority of Americans went along with this. There was little opposition or fight-back. The "masses" did not rise up and protect their jobs, their homes, their schools (which used to be the best in the world). They just accepted their fate and took the beating.

I have often wondered what would have happened had we all just stopped flying, period, back in 1981. What if all the unions had said to Reagan, "Give those controllers their jobs back or we're shutting the country down!"? You know what would have happened. The corporate elite and their boy Reagan would have buckled.

But we didn't do it. And so, bit by bit, piece by piece, in the ensuing 30 years, those in power have destroyed the middle class of our country and, in turn, have wrecked the future for our young people. Wages have remained stagnant for 30 years. Take a look at the statistics and you can see that every decline we're now suffering with had its beginning in 1981 (here's a little scene to illustrate that from my last movie).

It all began on this day, 30 years ago. One of the darkest days in American history. And we let it happen to us. Yes, they had the money, and the media and the cops. But we had 200 million of us. Ever wonder what it would look like if 200 million got truly upset and wanted their country, their life, their job, their weekend, their time with their kids back?

Have we all just given up? What are we waiting for? Forget about the 20% who support the Tea Party -- we are the other 80%! This decline will only end when we demand it. And not through an online petition or a tweet. We are going to have to turn the TV and the computer and the video games off and get out in the streets (like they've done in Wisconsin). Some of you need to run for local office next year. We need to demand that the Democrats either get a spine and stop taking corporate money -- or step aside.

When is enough, enough? The middle class dream will not just magically reappear. Wall Street's plan is clear: America is to be a nation of Haves and Have Nothings. Is that OK for you?

Why not use today to pause and think about the little steps you can take to turn this around in your neighborhood, at your workplace, in your school? Is there any better day to start than today?

Yours,
Michael Moore
MMFlint@aol.com
MichaelMoore.com

P.S. Here are a few places you can connect with to get the ball rolling:

Showdown in America
Democracy Convention
Occupy Wall Street
October 2011
How to Join a Union, from the AFL-CIO (They've learned their lesson and have a good president now) or UE
Change to Win
MoveOn
High School Newspaper (Just because you're under 18 doesn't mean you can't do anything!)