Have you had your fill of “expert” psycho-babble, high-level cheerleading, and government assurances that
sound more each day like sick punch lines to bad jokes:
• “Deficits don’t matter.”
• “The recession has ended.”
• “The weak
dollar is good for trade.”
• “Debt just needs to be ‘restructured.’”
• “We
just need more government stimulus spending.”
• “Federal zero interest rate
policies (ZIRP) help everyone.”
• “Unemployment is down.”
Enough of the minstrel show and its official nonsense. Here is the real deal
on the current corporate/government war against capitalism:
Farce #1: “Market value” and “free markets” have become a
joke.
In order for “value” to have financial value in the free market it, 1) must
have real worth to someone else, and 2) must be freely chosen. The whole point
of a market is that people choose according to their desires and needs, not
yours. No one is entitled to a profit.
That’s what “market value” and “free market” mean. Other people, known as
“the public,” interactively determine what your asset, good, or service is
worth. You may think something is financially worth a lot. If others do not,
it’s not worth squat.
If you can merely create private fiat by assigning your own value to
your “assets” and products and then force others to buy them, there is no valid
market value or free market. It is simply financial dictatorship.
Farce #2: Private, self-assigned, fake value is being traded for
public money at 100 cents on the dollar.
Even basic monetary standards for public exchange of value no longer apply.
Now big banks have been given the executive go-ahead to self-assign value to
their assets at any price they choose. This is called “market to model” (i.e.
profitable lying with complicated mathematical formulas).
This violation of capitalism comes not only in refusing to allow the market
to determine price of assets, but in forcing the public through government
capture to pay for “impaired private assets” with “real” public money at 100
cents on the dollar!
This is nothing more than the exchange of publicly accepted money for
worthless, private, counterfeit crap.
Farce #3: Printed money is backed by nothing.
However, what “value” does that public money have? What is the current U.S.
dollar tied to? Nothing of worth. It refers to no credible public asset, good,
or service. The Treasury and the Fed are just printing money, period.
The abstract future ability of the U.S. to pay off an exponentially
increasing debt amid a long-term contracting economy is not even close to being
a plausible substitute. If that money was invested in infrastructure, perhaps a
case could be made, but can you name even one project that the 800 billion
dollars of “stimulus spending” has funded?
In order for money to be a credible marker of exchange it must be tied to an
asset, good, or service that has collectively established worth (i.e.
commodities, present and future national productivity, or local networks of
exchange of services and goods).
Current money needs to become rebased in things that produce value, that
preserve and enhance present and future life. At bottom, neither banks nor
governments are doing that, and if anything they seem to be working hard
together to kill off both broader prosperity and free market capitalism.
Farce #4: We have a “free” enterprise system dominated by monopolies
that force people to buy inferior goods and services at exorbitant
rates.
Exhibit A: “Health” care: U.S. health “insurance”
is dominated by regional monopolies that are notorious for denying treatment and
charging double what the rest of the world charges. What do we get for that? We
get a record number of uninsured citizens, and health results (infant mortality,
etc), which are near the bottom, rather than the top, of industrialized
nations.
The U.S. health care system is also possibly one of the most inefficient in
the world in delivering services,
wasting
some 750 billion dollars per year in unnecessary spending, including
hundreds of billions of dollars per year in excessive administrative costs.
“The best health care system in the world”? Hardly. Maybe if you are rich or
have generous subsidized benefits.
Even then, you are not immune to hospitals that cut safety corners to save on
costs, and both slash pay and increase work hours for the people treating you.
Think about it. Medical error is one of the leading causes of death in the U.S,
killing
some 200,000 people per year.
Exhibit B: Military industrial complex boondoggles:
The United States is currently spending almost as much on its military as the
rest of the world combined.
What kind of value are we getting for that? We’ve gotten pointless wars built
on politically expedient lies, that have lasted longer than any wars in modern
history, that have cost trillions, and that have made us less secure.
Farce #5: High-level financial crimes, no matter how egregious or
widespread, are not being prosecuted.
Instead, corrupt and fraud-ridden organizations like Countrywide,
Goldman-Sachs, Bank of America, JP Morgan, and Citigroup, get bought up and/or
pay a small percentage of their ill-gotten gains to settle civil suits in which
they do not admit fault.
The leaders of these anti-capitalist organizations (Anthony Mazillo, Jamie
Dimon, Lloyd Blankfein, et. al.) still walk away with enormous compensation,
after having ruined their companies and tanked the world economy. When they have
to hire legal representation, they do it at the stockholders’ expense, adding
insult to injury.
There are probably millions of forged documents, involved in “fraudclosure”,
the pervasive property assignment control fraud that includes all the big
financial players. Companies and citizens have brought civil lawsuits, but these
are taking time.
There has been negligible government investigation, much less criminal
prosecution. Here you have millions of cases of the very foundation of private
property, clear ownership, being decimated by rampant, obvious fraud, and you do
nothing?
Oh, I forgot, you extend the big banks a reprieve in the form of yet another
settlement, this time with
States’
Attorney Generals (basically a 25 billion dollar slap on the wrist for
trillions of dollars of interconnected fraud). What does it take for law
enforcement to do its job?
What effect does this have? It screams, “Crime pays!” It destroys the morale
of hard-working, law-abiding citizens, and it keeps zombie banks not only alive
and kicking, but prospering on the backs of citizens.
It sinks the global economy even more by encouraging financial criminals to
double-down on the profitable crime that got them their unreal returns in the
first place.
Where do you think that’s going to end? Too-big-to-fail is now bigger.
Bailouts from central banks are more frequent. Overt and covert citizen
subsidies for this crime keep climbing. Welcome to the financial cancer
club.
Farce #6: Risk is gone. Now there is only liability borne by
citizens.
Corrupted capitalism expects you, the citizen, to pay for “their,” the crony
capitalists’, failure. In functioning capitalism, a company and its investors
take their own risks, profit from the gains, and stomach the losses. Other
people do not pay for their mistakes or their crimes.
That core element of capitalism is now gone. Irish citizens have had to pay
many billions just to cover the losses of one of their private banks. Greece has
learned, with its enforced austerity programs, that if this liability is not
paid in dollars (or the phony dollars of debt restructuring), it gets paid in
diminished quality of life.
Farce #7: Productivity has been supplanted by
parasitism
There is hardly anything more important to thriving functioning capitalism
than productivity, and sharing the fruits of productivity. It is notable that
productivity among U.S. workers actually skyrocketed over the last decade and a
half, but real wages have flattened or declined.
Where did the surpluses go? To parasitic financializers who have seen their
share over all corporate profits grow from
10%
to over 45% in recent decades.After costing trillions and wiping out
the world economy, what asset, good, or service do big banks produce that has
genuine public worth?
• “Expert advice”, in which brokers intentionally sell junk to consumers, as
shown in investment bank emails?
• “Financial services”, which turn out to be
so laden with hidden fees and loosened/fabricated credit qualifications that the
lendee is worse off?
• Allegiances that concentrate financial wealth the top
0.1% of the population, causing the vast majority of the world to get
poorer?
If anything, citizens would stand to gain more by paying big banks to close
their doors.
Big banks have largely stopped lending to businesses or individuals because
that’s not profitable enough and because they need to retain capital to reduce
their exposure due to their own foolish overleveraging. This depresses community
and small business entrepreneurship and productivity.
Bottom line: Big banks’ “services” take far more in costs than they provide
in benefits. Much would be gained, and little lost, if they were allowed to fail
or were decommissioned outright for their criminal behavior.
Conclusion
In short, the non-accountability of big banks means American honest work and
honest gain will be increasingly ripped off. This is a zero-sum game in which
not even a single, direct, effective champion of the interest of broader
American and middle and working class interest exists in the actual machinery of
Washington.
Those few heroes, the former and present prosecutors and officials who have
attempted to enforce transparency and accountability, Elizabeth Warren,
Brooksley Born, Harry Markopolos, Neil Barofsky, and William K. Black have
either been ignored, pushed out, or shut down.
Says
Neil
Barofsky of President Obama:
“I thought that if there was ever going to be a political figure that would
take on the interests of Wall Street, and put the American people… above the
monied interests, it was going to be President Obama, and that just didn’t
happen. In fact it was the opposite. He had the same ideology as Timothy
Geithner [and others from Wall Street]: ‘Protect the banks. What is best for the
biggest banks is what’s best for the country.’”
This is pretty grim stuff, but it has a silver lining: When you don’t have
champions to manage the economy fairly or effectively, you organize yourselves
to transform your economy.
Both liberal and conservative officials have
turned themselves from
public servants into private servants. We, in response, have no excuse
but to
turn ourselves into necessary public champions. We must
decide and act upon our choices to drive the economy in a healthy direction.
Economy cannot exist without people and their agreement. It is our job now to
form the next principles and new, healthy practices as we turn away from a
corrupted system.