Definition Cherry picking; suppressing evidence, or the fallacy of incomplete evidence is the act of pointing to individual cases or data that seem to confirm a particular position, while ignoring a significant portion of related cases or data that may contradict that position. It is a kind of fallacy of selective attention, the most common example of which is the confirmation bias. Cherry picking may be committed intentionally or unintentionally. This fallacy is a major problem in public debate.
While I try to address all the things you bring up as best as I can, you certainly don't answer the things I bring up; too bad. BTW, I forgot to mention all the wonderful contracts oil and construction companies got after the invasion of Iraq. In one word; cherry picking. Ok, here we go!
Ever heard of TIPP, the TransatlanticTrade and Investment Partnership, or the ISDS
"Ever hear that opposition is making the prospects"
not so good for either the US-EU or Asian treaties?
Yes, thank god some people are waking up to all this! However, clearly TIPP (US-EU trade) is not off the table, and they will do anything to push it through. Unfortunately, most of the damage has been done already when the US signed the NAFTA agreement which came into effect in 1994. Since then we've heard a "giant sucking sound" as Ross Perot liked to call it, of well paying jobs flowing to Mexico. The final nail in the coffin of the US was granting MFN (most favored nation) status to China in 1999. Millions of well paying manufacturing jobs have been lost since that time, could be more than stated in the MSM article;
"Pacify Afghanistan; was that even an objective?"
"Of course not.
And Hillary was just kidding about her "New Silk Road".
They like losing. Sure.
Conquering Afghanistan was supposed to insert NWO power into
territory between Russia and China - and stunt Eurasian development.
Reality: The NWO's most massive geopolitical defeat."
Correct me if I am wrong, but somehow I get the impression that you assume that the NWO's interests and America's interests are aligned. They are most certainly not; see B. Fuller's and D. Rockefeller's statements a few posts back. I'm sorry but this is an incorrect asumption, but a very important one, and probably the most important reason why we disagree. Do you really think these people care about countries, nations, peoples etc. They use them to their own advantage, that's all! The US of A and it's people have been most helpful in advancing their agenda, but not anymore! That's why the US and it's (world reserve) currency needs to be destroyed, as they form the most important impediment to their ultimate goal; a one world government and a one world currency under their control.
"Iraq: LOL, epic SUCCES! "
Think most Americans agree?
Think their resultant war-fatigue helps or hinders the Military Industrial complex?"
Again; NWO's interests are not aligned with America's (real) interests. You think they give a rat's ass about what Americans think. See how Obama is behaving; he's acting like he is some sort of emperor, not some "democratically" elected president, representing the people's interests. He does not even pretend anymore. War fatigue; how about some good old bombing campaigns against (supposedly) ISIS, because they're so dangerous and do things like beheading people. 14 years in Afghanistan; 11 years of involvement in Iraq, wars never seem to have lasted longer in the modern era. War mongering against Russia, Syria, deployment of troops in ebola stricken Africa, army/navy/air bases in most countries around the world, the Pentagon budget bigger than the 8 runners-up; what do you mean war fatigue?
2008 Economic Collapse: "Yes, of course, that was the purpose of this whole exercise all along!"
"So Neoliberal economics now globally discredited is a success?
And the economies of entire G7 block in stagnant depression is a success?
Think this helps or hinders the NWO's neoliberal politicians?"
It's not about the neoliberal politicians and their programs; they're mere patsies. They'll use any political doctrine that will help them, including "communism", as we have seen during the cold war. They want a neo feudal world, where we are mere serfs, and they can rule us as they please. Neo liberalism is only important in as far as it can help advance that agenda. Their real doctrine summed up in four words; we rule, you serve!
CARBON TAXES: "who says that they will not have another go at it?"
"But, I thought according to the propaganda you buy that the NWO run everything?!?"
Wow, that left me speechless for a moment; a few words come to mind here;
"below the waist line" most certainly, but above all;
"a man running out of arguments"
Did I, known on this forum as Plato, ever proclaim that I "buy that the NWO run everything"? If that were the case; why have this discussion at all?
However they do run;
The Fed, the BIS, the ECB, the BOJ, the BOE, the IMF, the Worldbank, the UN, the OECD, the EU, all the important commercial banks like JP Morgan, GS, etc. all the pharmaceutical companies and the energy industry; the MSM and let's not forget, a considerable portion of the alternative media, that proclaim to give right and truthful information (but in fact are merely disinforming and manipulating the real truth seeker)
"So why didn't those carbon taxes get entrenched worldwide, already?"
Well, everything still runs on carbon based fuels, on which we're still almost completely dependent and they make a killing, that's still pretty good isn't it? Ever checked the profitability of the oil majors? You'd be shocked!
Ok, I just had to put this piece in by mr NWO himself, the still increasingly creepy Henry Kissinger, who did an interview with Der Spiegel on his new book aptly called; World Order. Why on earth did he drop the "new"? Anyway, from the article his relentless pushing for a world order should be completely obvious, exactly as instructed by "the men behind the curtains".
Notice the interesting observation Der Spiegel makes with regard to a "superpower that always gets its way" and how Kissinger reacts by stating that the US can not dictate anymore.
Remember this man made an astonishing career and seemed to come out of nowhere, just like Obama, Blair, Clinton etc. He's also known for the rather infamous words;
“Who controls the food supply controls the people; who controls the energy can control whole continents; who controls money can control the world.”
Sounds like a really nice dude who'll do anything to achieve his goals!
Kissinger recently published his 17th book, a work with the not exactly modest title "World Order." When preparing to sit down with us for an interview, he asked that "world order" be the topic. Despite his German roots and the fact that he reads DER SPIEGEL each week on his iPad, Kissinger prefers to speak in English. After 90 minutes together in New York, Kissinger says he's risked his neck with everything he's told us. But of course, a man like Kissinger knows precisely what he does and doesn't want to say.
SPIEGEL: Dr. Kissinger, when we look at the world today, it seems to be messier than ever -- with wars, catastrophes and chaos everywhere. Is the world really in greater disorder than ever before?
Kissinger: It seems that it is. There is chaos threatening us, through the spread of weapons of mass destruction and cross-border terrorism. There is now a phenomenon of ungoverned territories, and we have seen in Libya, for example, that an ungoverned territory can have an enormous impact on disorder in the world. The state as a unit is under attack, not in every part of the world, but in many parts of it. But at the same time, and this seems to be a paradox, this is the first time one can talk about a world order at all.
SPIEGEL: What do you mean by that?
Kissinger: For the greatest part of history until really the very recent time, world order was regional order. This is the first time that different parts of the world can interact with every part of the world. This makes a new order for the globalized world necessary. But there are no universally accepted rules. There is the Chinese view, the Islamic view, the Western view and, to some extent, the Russian view. And they really are not always compatible.
SPIEGEL: In your new book, you frequently point to the Westphalian Peace Treaty of 1648 as a reference system for world order, as a result of the Thirty Years' War. Why should a treaty dating back more than 350 years still be relevant today?
Kissinger: The Westphalian Peace was made after almost a quarter of the Central European population perished because of wars, disease and hunger. The treaty was based on the necessity to come to an arrangement with each other, not on some sort of superior morality. Independent nations decided not to interfere in the affairs of other states. They created a balance of power which we are missing today.
SPIEGEL: Do we need another Thirty Years' War to create a new world order?
Kissinger: Well, that's a very good question. Do we achieve a world order through chaos or through insight? One would think that the proliferation of nuclear weapons, the dangers of climate change and terrorism should create enough of a common agenda. So I would hope that we can be wise enough not to have a Thirty Years' War.
SPIEGEL: You're speaking like a superpower that is used to getting its way.
Kissinger: No, the United States cannot dictate, and the US should not try to dictate. It would be a mistake even to think it could. But in regards to NATO, the US will have one vote in a decision based on unanimity. The German chancellor has expressed herself in the same sense.
_________________ "A person hears only what he understands."
Johann Wolfgang von Goethe
Excellent podcast by James Corbett from the Corbett report on the phoney tensions between China and its allies on the one hand and the West/Nato on the other. He drills down for us why this game was rigged from the very start with Kissinger's secret trip to China to establish ties between this country and the US. Some very well known names come up like Rothschild, Bush, Rockefeller etc. Must listen if you want to understand how they are fomenting this NWO and what they already have been doing for decades to achieve this.
From his webpage;
"Military tensions, cyber espionage accusations, a brewing currency war; with every passing day, the headlines paint a convincing portrait of an emerging cold war between China and the West. But is this surface level reality the whole picture, or is there a deeper level to this conflict? Is China an opponent to the New World Order global governmental system or a witting collaborator with it? Join us in this in-depth edition of The Corbett Report podcast as we explore China’s position in the New World Order."
Michael Hudson: "You cannot have a Chicago-style free-market
unless you’re willing to kill or eliminate everybody who disagrees.
It must be totalitarian. It’s the Pinochet model without the machine guns.
RA: Don’t they see the irony in this?
Hudson: No, they see their paychecks.
OUR "FREE MARKET" IS JUST TOTALITARIAN ECONOMICS
Michael Hudson: I’m Michael Hudson. I’m a professor of economics at the University of Missouri, Kansas City and Peking University. My focus is on the distinction between the financial economy and the real economy at large. I treat the financial sector and debt as an economic overhead, so my focus is on how society can deal with the debt and to explain why society cannot recover from the current depression until it writes down the debts to what can be paid.
Ross Ashcroft: Michael, we’re almost a decade on since 2008 and we sit here now in the developed west and we look at the global economy. To even an untrained eye, things aren’t still right and haven’t been right for some time. Where are we and what’s your view on why we’re here?
Michael Hudson: We’re in a permanent debt deflation. To make it brief, people think in terms of business cycles – as if whenever things go down, they automatically recover. But every business recovery since World War II has taken place with a higher level of debt – higher and higher and higher. Finally, by 2008, the volume of debt was so high that it was absorbing all the economic growth. At that point the stock markets plunged, especially when it became apparent that the business plan of the large banks was economic fraud and junk mortgages.
People say when Queen Elizabeth asked “Why didn’t anybody foresee it?” The fact is, everybody foresaw that there was going to be a crash. That’s why they used the term “junk mortgage.” That’s why they coined the term NINJA: No income, No job, no assets. All this terminology was widely used. The FBI in 2004 explained that there was the largest wave of financial bank fraud in history, but George Bush shifted the investigators out of the FBI into national security, so nothing was done.
When President Obama ran for election, he promised to write down mortgage debts to the real value of property, not the junk mortgages in excess of the value. The terms that Congress set for the bailout of the banks, the Troubled Asset Relief Program or TARP, were that banks would rewrite the mortgages so that homeowners who could not pay the nominal mortgage would simply pay what the rental value of their property was.
RA: And what happened?
Michael Hudson: In practice nothing was done. The banks were saved, not the economy. Tim Geithner, who was a protégé of Robert Rubin, was moved on behalf of Citibank into the Treasury, and he bailed out the banks – leaving all the debts in place, not writing them down. Banks stopped lending mortgage money, and began to call in their credit card loans by about 100 billion dollars, from one trillion to about 900 trillion. Mortgages were not written off, so homeowners had to pay so much money to pay off the debts that had been built up during the bubble economy that they didn’t have enough income left to buy goods and services.
RA: You make a distinction between the real economy and Wall Street or the financialized economy and when you say that the debt has built up since World War II, year on year. Are you’re saying that when the real economy can no longer service that debt, we have a financial crisis?
Michael Hudson: That’s when you have a crisis.
RA: So it isn’t a black swan as such?
Michael Hudson: It is inevitable. The magic of compound interest means that interest grows and the debt accumulates. When you add in new money creation, debts grow faster than the economy at large. So the situation that existed in 2008 remains the case today: Debt in almost every country is equal to the entire GDP, the entire national income. Now, if debt is equal and the interest rate on debt that people have to pay is 4 percent, then if economies only grow at 1 or 2 percent (as they are today), then all their economic growth has to be devoted to paying the financial sector.
RA: For interest payments?
Michael Hudson: On interest alone – not mentioning the repayments of principal to pay down the debt. This is the phenomenon of debt deflation that was discussed in the 1930s. It’s a phenomenon that is inherent in the mathematics of compound interest. In fact, this should be the focus of the economic curriculum.
RA: Can you explain?
Michael Hudson: If you’re teaching economics, you should begin with the relationship between finance and the economy – between the buildup of debt and the ability to pay. That should be the starting point if you realize that the problem of our time is how can society cope with the debt buildup that has occurred. That is what is keeping the economy from recovering?
RA: So people listening to that must think “Well God that is the obvious place to start. Why doesn’t every undergrad economics course start with that?”
Michael Hudson: I taught money in banking at the New School for Social Research in the 60s and 70s. Bob Heilbroner, the department chairman, wanted to conform to the mainstream and teach the Chicago School monetarism that treats the economy as if it operates on barter. If you look at almost any economic textbook, all the way through the Ph.D., they treat the economy as being barter. They then factor in money creation as if money it directly affects prices proportionally –and claim that this doesn’t change basic relationships, even between debtors and creditors.
This kind of tunnel vision led people to call the bubble economy’s lead-up stage “the Great Moderation.” It was a Great Moderation in the sense that the banks were able to lend homeowners and companies and governments enough money to pay the interest. There has been the largest increase in credit creation in history since 2008, with almost no increase in consumer prices or wages. All the money creation has gone to buy stocks and bonds into the financial sector.
RA: So just let’s define the Great Moderation. Which years would you put the great moderation between?
Michael Hudson: About 1995 to 2008. As Alan Greenspan explained it, he said that it was moderate because labour didn’t complain. Productivity was soaring and wage rates did not go up in the American economy. He explained this before the Senate committee, as what has been called the “Traumatized Worker Effect.” He said that workers are so deeply in debt that they’re afraid to strike. They’re afraid to complain about working conditions, because they could be walked out the door, and if they are fired, if they don’t have a job, then suddenly the interest rates they pay on their credit cards go up to 29 percent. They’re one month away from insolvency, one month away from homelessness.” So Greenspan said, in effect, “We’ve hooked them. We’ve got them.”
RA: And his view is that’s the optimum state for workers, why?
Michael Hudson: Because that’s what he calls a “free market.” It’s a free market where the 1% get to smash the 99% without any ability of the 99% to fight back. A free market in which people do what they’re told. That is the opposite of what Adam Smith and John Stuart Mill and other classical economists meant by a free market. They meant a market free from rentiers, free from landlords, free from banks – so that where everybody got only what they deserved and produced. But under Greenspan and modern economics, a market is “free” from government regulation, free from throwing the bankers in jail when they commit crime, free from any kind of policymaking by government, by labor unions, or by society. So a free market today is a centrally planned economy, but it’s not planned by government. The planning is shifted out of government to the banks.
RA: …and Wall Street.
Michael: Wall Street in the United States, and the city in London.
RA: There can be no bigger failure, as we sit here, when you look at the actions of central bankers. When you talk about the real economy, where next for them?
Michael Hudson: It’s hard to take people who have a tunnel vision and expand it, because they’re like the old-time Stalinists or religious sectarians. Their minds are absolutely set, there is no way you can have a reasonable argument with the Federal Reserve economists, because they know who appoints them: the Wall Street institutions. They’re drawn from these Wall Street institutions. It’s also the financial sector that endows the universities and the business schools. Hardly by surprise, these schools teach that there is no such thing as unearned income, no exploitation. They teach that the financial sector is the most productive sector in the economy, instead of a burden that should be subtracted from GDP, because it’s an overhead that the rest of the economy has to pay.
This was the basic classical economics of Smith, Ricardo and John Stuart Mill. They all looked at what the landlords got – and what banks got – as socially unnecessary overhead. The economy could function technologically without a landlord class, without a banking class. But there was a political malformation of markets.
Market economists take the status quo for granted. They assume that “the market” is what exists, as if this has occurred naturally through some kind of Darwinian evolution. As Margaret Thatcher said, “There Is No Alternative.” That’s what central bank theory is like: there is no alternative to central banks serving their clientele, the commercial banks.
RA: So let me suggest that there is an alternative, and get your thoughts on this, because this idea has run its course. People are now starting to wake up and say” enough.” You’ve written a lot about unearned versus earned wealth – unearned wealth or unearned increment, if you like – and it goes back to a man called John Bates Clark. He was one of the first neoclassical economists. I think I’m right in saying that. Just talk a bit about him, he said there was no differentiation, is that right?
Michael Hudson: Yes.
RA: And that seemingly innocuous proclamation has had huge effects.
Michael Hudson: By the 1870s and ‘80s there was a lot of pressure in all countries, especially in the United States, by socialists on the one hand and followers of the journalist Henry George on the other. George wanted to tax away the land’s economic rent and use that as the tax base, instead of taxing labor and industry. So John Bates Clark wrote about the philosophy of wealth, and said “There’s no such thing as unearned income. Everything that the economists before me have written is wrong. Everybody earns exactly what they contribute to national product and that means that whatever their earnings are will be added to national product.”
I’ll give you an example of where this leads. About two years ago the head of Goldman Sachs, Lloyd Blankfein, said that Goldman Sachs managers were the most productive people in the American economy, because they earned $22 million a year in salary – not counting their stock bonuses. What he meant was that all this $22 million is added to GDP. If productivity is measured by the income received per laborer, and if by definition, everything you’re paid to Goldman Sachs is in addition to GDP instead of a subtraction from it, then we at Goldman are the most productive. That is their tradition that John Bates Clark got us started along.
RA: No wonder he got funded!
Michael Hudson: He got so well-applauded by the bankers, landlords and the FIRE sector that the American Economic Association established the John Bates Clark Award for economists under 40 years old who were writing in this anti-classical tradition. They call it “neoclassical” to erase the fact that they are the exact opposites of classical economics.
RA: Wow and that medal- or that award?
Michael Hudson: It goes to free enterprise right-wing economists to legitimize their trickle-down pattern talk. There’s been a pretense that the only legitimate economists are people with a tunnel vision who say it’s OK to give Wall Street whatever it wants. Their line is that governments shouldn’t regulate prices, they should not throw the bankers in jail, they shouldn’t even regulate consumer protection, because that’s added paperwork and only adds to consumer prices. If you get rid of government, everybody will be happy. So the 1% say: “Trust us we’re job creators.” In fact, of course, they’re job destroyers when they use leveraged buyouts to take over a firm, downsize the labor force, wipe out the pension fund and outsource labor to China or wherever.
RA: Just so we’re clear on terminology, can you give us your definition between earned wealth and unearned wealth or income, because people on the ground know that there’s something wrong but they can’t define what the problem is.
Michael Hudson: The classical economists said there were three kinds of unearned income: Land rent of absentee owners, that you have to pay just because their ancestors conquered the land and established a hereditary rental claim. Monopoly rent by a monopolist, and natural resource rent by mine and other owners. They all charge a price that’s much more than the cost of production justifies. Finally, there is interest and financial charges. These are technologically unnecessary. We have economies that share the same technology all over the world. So essentially, “economic rent” was the term that the classical economists used for unearned income. It’s the excess of price over actual cost value.
How much does a product, a pharmaceutical, for instance, actually cost? If it costs $2 to make a pharmaceutical pill and they sell it for $200 ,that difference of price over value is “rent.”
RA: And is that called the economic rent?
Michael Hudson: That’s called monopoly rent. It’s one of the three forms of economic rent. Unearned income is income that really is paid to an unnecessary class. They used to be called the idle rich in the 19th century.
RA: What did Veblen call them?
MH He called them the vested interests. They were the people who actually run society and they secure their status by dumbing down economics. Veblen wrote wonderful books about the decay of education, which he said was the ideology of the ruling class. The purpose of economic education is not to explain how the world works, but to give a vocabulary that will confuse people into believing that the world has to be the way it is, so that there is no alternative, instead of thinking about possible reforms.
Vested interests do not want the history of economic thought taught. When I studied economics and got my Ph.D. there were still courses in the history of economic thought, all of this has been dropped from mathematics now. So when people talk about Adam Smith on a pedestal, or John Stuart Mill, they have no idea that Smith actually was criticizing the rentier sector, the landlords, the monopolists and the banks. He’s made out to be a prototypical Alan Greenspan, a lobbyist for the banks and for the real estate sector.
RA: Where do you see the discipline? You touched on it earlier. Professor Luis Garicano at the LSC – when the Queen asked him, she said “Why did no one see it coming?” He couldn’t answer the question. Economics is the dismal science, and it couldn’t get more dismal. It’s a field you’ve worked in all your life. Where do you see it going from here?
Michael Hudson: You can’t turn a cold-blooded frog into a warm-blooded mammal by saying “Why don’t you just warm up your blood?” It takes an entirely different entity. I don’t think academic economics can be reformed from within, because you have locked in the old vested interests. You can’t change the thoughts of somebody whose mind is trained in tunnel vision.
You have to do what was done a century ago and create a new discipline. Unfortunately, sociology has met the same fate as economics, largely at the hands of the University of Chicago. So you have to have something else: You could call it “futures studies,” or “reality economics.” But it would be a different discipline. We still call it economics at the University of Missouri at Kansas City, where I am a professor. Our graduates, however, have difficulty being hired by other universities, because in order to be hired in America you have to publish articles in refereed journals. The right wing, the monetarists, the Libertarians and neoliberals, especially through the Chicago school – they have taken over the economic journals, and will not let any alternative analysis or views be pushed.
That’s the genius of Chicago free-market economics. It’s the Pinochet principle: You cannot have a Chicago-style free-market unless you’re willing to kill or eliminate everybody who disagrees with you. Free-market economics Chicago-style must be totalitarian. There must be no alternative. This is what is happening. This is how economic education in the United States is. It’s the Pinochet model without the machine guns.
RA: Don’t they see the irony in this?
Michael Hudson: No, they see their paychecks.
RA: If we take it to its logical conclusion, where does it end? Totalitarianism?
Michael Hudson: It ends with economic planning shifting out of the hands of democratic government into the hands of the central bankers and the Treasury. They will do to Europe what they’ve done to Greece. They will do to the United States what they’ve done to the Baltics, who celebrate austerity and mass immigration and demographic collapse as if it is a miracle instead of economic disaster and suicide.
So you have a vocabulary that has been twisted into what really is junk economics. You have euphemisms, an Orwellian-type vocabulary of using words that actually mean the opposite. So a “free market” really means “the road to debt peonage.” You have Friedrich Hayek calling any kind of consumer protection or government protection of the economy the Road to Serfdom instead of the road away from debt peonage.
Basically, free market economics is “blame-the-victim” economics. It says that if you don’t have a job, if you owe money and can’t pay your education debt, that’s your fault. You’ve made the wrong economic decisions. If you were smarter, as smart as Goldman Sachs people, you would make money. The rich people are simply the smart people, and if you’re poor it’s because you’re dumber than the smart people. That, basically, is what it’s all about: intelligence.
Well you don’t need intelligence to make money. All you need is greed, and that’s not taught in business schools. That’s why Goldman Sachs and other Wall Street firms, already 50 years ago when I was on Wall Street, said that the best people they recruited came either from the Brooklyn slums or the Hong Kong slums. They’re the best foreign exchange traders because all they want to do is make money. They’re the people that Wall Street investment banks want. But that has nothing to do with being smart. It’s a tunnel vision, a short termism. The economy, by living in the short term, is destroying itself in the long term.
RA: Let’s end on a positive. Where do you see a hopeful scenario? Where do you see change coming from? I know you’re saying we’re locked into this. It’s sort of structurally determined. But there must be glimmers of hope that you see?
Michael Hudson: In the end there’s only one way of solving the problem. That’s to write down the debts. There is no way today’s debts can be paid. The only way to free the economy from these payments for debt service is to write down the debts. That’s what finally happened in Rome. That was what Jesus’ first sermon was all about, wanting to restore the Jubilee Year.
RA: We know what happened to him.
Michael Hudson: That’s what finally happened in the 1920s when Germany and the allies were pushed into depression by German reparations to the allies, for them to pay their Inter-Ally war debts to the United States. Finally these were all cancelled in 1931.
So after about a decade of depression, there will be enough people who will finally see that the debts have to be written down. But there’s not that awareness yet, because there is a feeling that money doesn’t matter – that debts don’t matter, and the economy is really just barter. Unless people think of debt in terms of the whole economy being wrapped in a context of debt and property ownership and rent extraction, they won’t realize that’s what’s being sucked out of the economy doesn’t have to be. It doesn’t have to be this way.
RA: So you’re saying there is an alternative.
Michael Hudson: Yes, there is alternative.
RA: Flesh out that view.
Michael Hudson: Well, it’s the view that classical economists had. They were reformers. Their idea was to keep natural monopolies – including health care and pharmaceuticals, water and electricity – in the public sector. You’d have a public alternative to provide basic services and basic needs that cost.
The first business professor in the United States, Simon Patten, said that government infrastructure is a fourth factor of production, alongside labor, land and capital. But unlike private capital, it doesn’t aim at making a profit. It aims at supplying health care and water, and banking either at cost or at a subsidized price or freely. That’s how you make an economy low-cost. If there is a natural rent in some land sites, you use that as a tax base. You tax economic rent, not labor, not industry. Basically, you tax free-lunch income. You don’t use a tax system that adds to cost instead of subtracting from costs.
RA: If you approach the economy as a design job and say “This is the economy we want to design.” The social and economic indicators are going to start to go in the right direction. You’ll have a completely different set of indicators. But we are diametrically opposed to that system at the moment?
Michael Hudson: Yes, that’s correct.
RA: And really, because you’ve written ‘Killing the Host’, which, by the way, is excellent and what a contribution. This depicts it because the parasite is now so big, the host is labouring badly under that.
Michael Hudson: The key of parasitism in nature is not simply that the parasite takes the life blood of the organism. In order to do that, the parasite has to take over the brain. It takes over the brain of the host to make the brain think that the parasite is actually part of the host’s bod, and even the baby. So what you have today is an economy that imagines that the financial sector and the Donald Trumps of the world and the real estate speculators are part of the economy, part of GDP instead of being an overhead, a tumor. You can get rid of the tumour, through a proper tax policy and by having a public option as an alternative.
RA: If you were going to run I’d vote for you.
Michael Hudson: I don’t think I could raise as much money from Wall Street as the other side.
RA: Why not? You don’t think they like this message?
Michael Hudson: Well, politics is not about reality. You saw what happened to Bernie Sanders and all the stuff that’s come out from WikiLeaks about how the election was fixed against him. The delegates that Hillary won at the beginning were in the South, which are Republican states. So she won the Republican states as her major backers within the Democratic Party. That means that the candidate of the Democratic Party was elected primarily both from apparatchiks within the party and by Republican states. That’s the irony of all this.
RA: Congratulations on ‘Killing the Host’
Michael Hudson: Thank you very much.
RA: An excellent book.
Michael Hudson: Just finishing the sequel to that and the companion volume, which is “J for Junk Economics”-
RA: Tell us about it.
Michael Hudson: It basically shows how the economic vocabulary has become Orwellian. The words that economists use have become the opposite of what they were really meant to be. “Free-market” now means the opposite of what Adam Smith meant by a free market. Right down the line, you have junk economics, which is basically neoliberalism, the Chicago school. It’s a fictitious picture of how a hypothetical universe might work if the 1 percent were really job-creators. If they really ran the economy in order for a long-term growth, instead of in the short-term to make money for themselves and take the money and run. So it confuses a good economy with a bad economy. Reality economics with desert island economics, which is the kind of individualistic asocial, almost autistic economics that passes for economic education today.
RA: So you’re not surprised that Greenspan and Ayn Rand were good mates and actually that she talked to him about sociology. You’re not surprised about that?
Michael Hudson: When I worked on Wall Street for Chase Manhattan, he was brought into a study I was doing on the oil industry. Chase was very worried that just his presence on the study would discredit it, because he was notorious for saying whatever a client asked him to say. He was a lobbyist already in 1966 when this occurred. So I was given the job of firing Alan Greenspan from the study, and removing it, because they said “He’s such a little bastard, we don’t want him to come after us. You’re a little guy, you’re in your 20s, he doesn’t even know who you are. So give them the information that we know he faked the figures, we know where he faked.”
I was given the job of finding where he faked them from and writing it all up in the small print. So when Greenspan finally left the Federal Reserve, the BBC had on its screen for that day, “After me, the deluge.” with Michael Hudson because they asked me what do I thought of it. He left the economy knowing he was jumping ship, just like investors are jumping ship today from the economy that they’ve driven into debt deflation.
RA: Thank you very much. It’s an awesome book and so what’s coming up is ‘J for Junk Economics’.
Michael Hudson: Yes that’ll be out later in January. I’m just going over the proofs now and ‘Killing the Host’ was just translated into German in late November by press.
RA: It’s always nice to shake the hand of a man who has fired Alan Greenspan.
Michael Hudson: Thank you.
“Where does money come from?” Available from Amazon.
You need to really understand money and debt, this leads to Minsky Moments and Debt Deflation.
1929 – US (margin lending into US stocks)
1989 – Japan (real estate)
2008 – US (real estate bubble leveraged up with derivatives for global contagion)
2010 – Ireland (real estate)
2012 – Spain (real estate)
2015 – China (margin lending into Chinese stocks)
Debt inflated asset bubbles.
The work of Irving Fischer, Hyman Minsky and Steve Keen, each one build on the work of his predecessor.
It's just three years since I did the "People's Printing Press" audio,
and here comes the first official government program to implement one of
the core parts of "new money": Basic Income - on Jan 1, 2017 in Finland.
This is a pilot scheme, but the plan is to extend the concept to ALL persons
not in a full-time job: including freelancers and even small entrepreneurs:
HELSINKI (AP) — Finland has become the first country in Europe to pay its unemployed citizens a basic monthly income, amounting to 560 euros ($587), in a unique social experiment which is hoped to cut government red tape, reduce poverty and boost employment.
Olli Kangas from the Finnish government agency KELA, which is responsible for the country's social benefits, said Monday that the two-year trial with the 2,000 randomly picked citizens who receive unemployment benefits kicked off Jan. 1.
Those chosen will receive 560 euros every month, with no reporting requirements on how they spend it. The amount will be deducted from any benefits they already receive.
The average private sector income in Finland is 3,500 euros per month, according to official data.
Kangas said the scheme's idea is to abolish the "disincentive problem" among the unemployed.
The trial aims to discourage people's fears "of losing out something", he said, adding that the selected persons would continue to receive the 560 euros even after receiving a job.
A jobless person may currently refuse a low-income or short-term job in the fear of having his financial benefits reduced drastically under Finland's generous but complex social security system.
"It's highly interesting to see how it makes people behave," Kangas said. "Will this lead them to boldly experiment with different kinds of jobs? Or, as some critics claim, make them lazier with the knowledge of getting a basic income without doing anything?"
The unemployment rate of Finland, a nation of 5.5 million, stood at 8.1 percent in November with some 213,000 people without a job — unchanged from the previous year.
The scheme is part of the measures by the center-right government of Prime Minister Juha Sipila to tackle Finland's joblessness problem.
Kangas said the basic income experiment may be expanded later to other low-income groups such as freelancers, small-scale entrepreneurs and part-time workers.
_________________ Minds are like parachutes.
They only function when open.
You know they are trial ballooning the same thing in the UK too.
Essentially what has been proposed is eradication of all benefits save for child benefits and in exchange each and every person will be given 100.00 a week to exist on. When you consider the job destruction which is just around the corner, this renders people as essentially obsolete reduced to scraping through their very existence on 100.00. This isn't innovative, this instead is how do we keep the serfs in their place.
It could be innovative but the established hierarchy give 2 shits about any of us. So, instead the allowance provides to survive on will of course be eroded by inflation too. These are insane fucking times.
It could be innovative but the established
hierarchy give 2 shits about any of us.
Agreed. My interest in it is as a totem or marker for the slow dawning of
economic reality and the downfall of the Puritan work ethic.
(epitomized by Boomer joggers for whom
work downtime was exercise work instead!)
Basic income is the thin end of a wedge we should hammer well home!
..here's Invisible Revolution economics
meeting the readers of The Nation mag:
NEW MILLENNIAL SOCIALISM
MEETS OLD WHITE GUYS
By Julia Mead
On Wednesday, November 9, at 9:47 am, BuzzFeed News sent out a push notification: “Trump is leading a global nationalist wave. The liberal world order is nearly over and the age of populism is here.” This, from a publication better known for listicles than sweeping political pronouncements. If even BuzzFeed felt it necessary to ring the death knell for the “liberal world order,” then liberalism must be really, really dead.
But what, besides global nationalism, can replace it? The answer is clear if we look at the 2016 election from its inception. The race we should be remembering is not just Clinton versus Trump, but Sanders versus Clinton. For nearly a year, millions of Americans supported an avowed socialist, and many of those people were young—like me.
This new New Left renaissance isn’t confined to the United States: Our British neighbors witnessed a similar wave of enthusiasm for Jeremy Corbyn. It’s kind of funny, if you think about it: The two most prominent politicians to galvanize young people in the United States and the United Kingdom over the last year are old white dudes. Sanders and Corbyn both look like my dad, except even older and less cool.
And it’s not just them—their ideas are old too. Or so it would seem to anyone who came of age before the fall of the Berlin Wall. Socialism, the redistribution of wealth, providing vital benefits and social services through the mechanism of the state—people were talking about this in the 1960s. And in the 1930s. And in the 19-teens. And now Sanders and Corbyn are recycling those hoary ideas (or so the argument goes), their only concession to the 21st century being the incorporation of racial-, queer-, and climate-justice rhetoric. (We can argue about how earnest they are and how successful that’s been).
And yet, in the 2016 primaries, Sanders won more votes from people under 30 than Clinton and Trump combined. Bernie pulled in more than 2 million of us; Clinton and Trump trailed far behind, with approximately 770,000 and 830,000, respectively.
Corbyn’s signature achievement thus far has been nearly tripling the size of the UK Labour Party. With over 550,000 members, it’s the largest political party in Western Europe. Though Corbyn’s supporters are not as strikingly youthful as Sanders’s—the influx of new members has barely changed the party’s average age—the youngest among them have a similar enthusiasm.
If you spent last year wondering why all these young people (“millennials,” as the headlines love to shout) have flocked to dudes even older and less cool than my dad, consider this: I’m 22. I was born in 1994. Bill Clinton was president. It was the era of the New Democrats in the United States and New Labour in the UK. Five years earlier, Francis Fukuyama had famously declared “the end of history,” and neither September 11 nor the global financial collapse had yet shaken that sense of security. My birth, and that of my generation, coincided with a huge geopolitical shift: For the first time in 50 years, the world wasn’t split in two along the familiar capitalist/communist lines of the Cold War. Seemingly, it had become whole.
George W. Bush was president for most of my childhood. My parents were Democrats in a red state, and at that point primarily defined their politics as being against the Iraq War and for same-sex marriage. Things like class, exploitation, and inequality were never mentioned, let alone a systematic way—like socialism—to think about them. I took up these anti-Republican positions with righteous gusto. In fact, I was co-president of my high school’s Young Democrats chapter, where I organized a screening of Jesus Camp and led discussions about the hypocrisy of the right’s “family values” agenda. Those were my politics.
The first president I voted for was Barack Obama, in 2012. By then, the shiny hope-and-change stuff had worn off a bit. I vaguely knew that drones were bad and that those responsible for the financial catastrophe a few years earlier had gotten off easy, but I didn’t think about it much. I was too busy binge-drinking in sweaty college basements—and hey, I’d voted for a Democrat. That was chill, right?
A child of the ’90s, I knew only neoliberalism. Socialism was brand-new.
It was during Obama’s second term that I began to understand how bad the financial crisis was and who was responsible (hint: the financial sector). Occupy Wall Street started to seem less like agenda-less rabble-rousing, as I had thought when I was co-president of the Young Democrats, and more like people confronting wealth and power in an unprecedented—and incisive—way. Thomas Piketty published his neo-Marxist tome, and its introduction alone fundamentally changed the way I understood economics. There was that viral video, based on a 2011 academic study of Americans’ perceptions of inequality, that used stacks of money to illustrate the wealth gap in United States. I must’ve seen it 30 times.
Four years later, as I finished college, Bernie Sanders shuffled onto the national political stage and offered an analysis: Poverty isn’t a natural phenomenon; it exists because a few people own far more than their fair share. He also offered a solution: The government could act on behalf of those of us just barely treading water. The government’s role, Sanders argued, is to correct the rampant inequality in this country by taxing the rich and using that money to offer real social services.
The erasure of socialist ideas from serious political discourse throughout most of my life wasn’t a historical fluke. The West’s victory in the Cold War—liberal democracy for everyone!—came at the price of iconoclasm, much of it celebratory. In Prague, there used to be a giant socialist-realist statue of Stalin and other communist leaders standing in a line on a hill overlooking the city from the north. Czechs called it the “meat line,” a joke about the long lines they had to wait in to get groceries. Now kids skateboard on the platform where the dictator once kept watch. To visit Prague now—or Budapest, or Sofia, or Bucharest, or Berlin—you might think that communism never happened. All that’s left are a few tacky museums and somber monuments.
So communism was killed, and along with it went any discussion of socialism and Marxism. This was the world of my childhood and adolescence, full of establishment progressives who were aggressively centrist and just as willing as conservatives to privilege the interests of capital over those of labor: think of the reckless expansion of so-called free trade, or the brutal military-industrial complex. For most of my life, I would have been hard-pressed to define capitalism, because in the news and in my textbooks, no other ways of organizing an economy were even acknowledged. I didn’t know that there could be an alternative.
It occurred to me recently that my peers and I will come of age in the era of Trump. It’s a bleak generational landmark, and not one I anticipated, but ideological capitulation and despair are not the answer. In the 1930s and 1940s, many of the most dedicated antifascists were communists. The antidote to radical exploitation and exclusion is radical egalitarianism and inclusion.
So we will be the opposition—but we’re not starting from scratch. The Fight for $15, organized in part by Socialist Alternative, went from a fringe dream to a political reality that has thus far spread to at least 10 cities and two states. Heterodox economists like Ha-Joon Chang, Mariana Mazzucato, and Stephanie Kelton are reshaping their discipline. And while Trump has dominated the headlines, there is still plenty of momentum around the socialist ideas that Bernie used to inspire America. Our Revolution is working hard to take the fight to the states; there it will be joined by groups like the Working Families Party and the Democratic Socialists of America, whose membership has grown by more than 50 percent since November 8. That’s more than 4,000 new members.
When I heard Bernie say, out loud, that the billionaire class was ruthless and exploitative, that sounded groundbreaking. Not only did he name the right problem—inequality, not poverty—he named the culprit. I didn’t know you could do that. To me, and to hundreds of thousands of my peers, Sanders’s (and Corbyn’s) socialism doesn’t feel antiquated. Instead, it feels fresh and vital precisely because it has been silenced for so long—and because we need it now more than ever.
My dad—slightly younger and slightly cooler than Sanders and Corbyn—picked me up from the airport the day before Thanksgiving. In the car, he confessed: “I liked a lot of the things Bernie had to say, but I just didn’t think he could get elected.” He sighed, ran a hand through his white hair, and pushed his glasses up his nose. “I thought Hillary had a better shot, but she couldn’t pull it off. Maybe Bernie could have… Wisconsin, Michigan, Ohio…”
My dad sounded humble. Trump’s election, which to so many of us feels like a tragedy, prompted him to consider a new way of thinking. Maybe socialism isn’t a lost cause after all. Maybe it’s our best hope.
Stark Inequality: Oxfam Says 8 Men as Rich as Half the World
By PAN PYLAS, ASSOCIATED PRESS
DAVOS, Switzerland — Jan 15, 2017
The gap between the super-rich and the poorest half of the global population is starker than previously thought, with just eight men, from Bill Gates to Michael Bloomberg, owning as much wealth as 3.6 billion people, according to an analysis by Oxfam released Monday.
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