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Shinzo Abe’s Nationalist Strategy | The Diplomat

Shinzo Abe’s Nationalist Strategy | The Diplomat.

Shinzo Abe’s Nationalist Strategy
Image Credit: REUTERS/Yuya Shino

Shinzo Abe’s Nationalist Strategy

With his overt nationalism and his historical revisionism, Shinzo Abe has a plan for Japan.

By Kosuke Takahashi
February 13, 2014
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The world is now beginning to realize Japanese Prime Minister Shinzo Abe’s true intentions. With his controversial visit to the Yasukuni shrine, which memorializes war dead, including Class A war criminals such as Hideki Tojo, he is no longer hesitant to reveal his true nature: without question, the most conservative leader in Japan’s postwar history. And he is a historical revisionist, notably with respect to wartime Japan. By encouraging a spirit of nationalism, Abe is hoping to engender self-confidence and patriotism among the Japanese public.

But what exactly is his future agenda? To understand Abe’s political ambitions, you need to understand their take on modern Japan.

For mainstream Japanese conservatives such as the Abe family, Tokyo has been shackled since it accepted the judgments of the International Military Tribunal for the Far East, known as the Tokyo Trials. For one thing, as a defeated nation Japan has always been forced to take a servile position— militarily and diplomatically—toward the U.S., the World War II victor. And Japan has had to repeatedly bow its head to its neighbors, such as China and South Korea, to apologize for its conduct during the war.

Willingly or not, Japan embraced these two international restraints when it signed the San Francisco Peace Treaty in 1951, hoping to return to the fold of the international community as an independent nation.

More than 60 years later, though, the Abe administration wants to free Japan from these perceived shackles. In his own words, he is seeking a “departure from the postwar regime” by “bringing back Japan.” Although Abe has never said from “what” he will bring back the nation, many Japanese believe what he meant is to bring back a militarily, diplomatically and economically strong Japan from the political and economic abyss of the past decades, and perhaps in the long term from the U.S. itself.

Although Abe’s popularity has recently tapered somewhat from the heady days early in this, his second stint as prime minister, many Japanese still support his nationalistic program, because they feel that Japan lacks strength and needs to stand on its own feet, amid mounting nationalism in East Asia and a rising China.

So, to return to the question: What is Abe’s grand strategy? In fact, Abe has a three-year plan to accomplish his ultimate goal of having Japan “depart from the postwar regime.”

Abe’s Three-Year Plan

During the first year of his second term in office 2013, Abe proposed a move from “passive pacifism” to a “proactive pacifism” that encourages Japan to contribute more proactively to world peace and international cooperation. He then established a Japanese National Security Council (NSC). He also announced the first National Security Strategy (NSS) and the National Defense Programme Guidelines (NDPG) that introduced the concept of “a Dynamic Joint Defense Force.” This new concept emphasizes the Self-Defense Forces’ (SDF) joint operations and interoperability capability at sea, in the air and on land, and bolster the nation’s defensive posture in the southwest—in particular the Nansei island chain that includes Okinawa and the disputed Senkaku/Diaoyu islands in the East China Sea.

Over the last year, Abe’s government has also enacted a controversial secrecy law to prevent leaks of state secrets, after it was pressured by the U.S. to tighten the confidentiality of their shared intelligence on security.

Now, in his second year, Abe is trying to reinterpret the constitution to allow for the exercise of the right of collective self-defense. Abe will also formally abolish Japan’s decades-old ban on weapons exports this year. In January, his administration revised textbook screening guidelines to give Japanese children a more patriotic take on modern Japanese history and to better reflect the government’s view on territorial issues such as on Senkaku Islands. Abe has also succeeded in placing four conservative intellectuals with whom he has very close ties on Japan’s public television NHK’s management board. Some of their comments have already stirred considerable controversy.

In this third year, 2015, Abe plans to change Article 9 of the U.S.-imposed pacifist constitution, accomplishing his final goal of escaping from the postwar regime.

This three-year plan seeks to boost national security and could lead to Japanese involvement in conflicts abroad in the future.

Shinichi Kitaoka, a former Japanese ambassador to the United Nations and a key Abe adviser, remarked recently that all of these steps are simply trying to bring Japan closer to a “normal country.” Kitaoka is now deputy chairman of Abe’s Advisory Panel on Reconstruction of the Legal Basis for Security, which is expected to recommend reinterpreting Japan’s war-renouncing Constitution to lift the self-imposed ban on the right to exercise collective self-defense in April.

Why America Needs War | Global Research

Why America Needs War | Global Research.

Global Research, February 08, 2014
Indy Media Belgium and Global Researcvh 30 April 2003
war

This incisive article was written on April 30, 2003, by historian and political scientist Jacques Pauwels. 

Wars are a terrible waste of lives and resources, and for that reason most people are in principle opposed to wars. The American President, on the other hand, seems to love war. Why? Many commentators have sought the answer in psychological factors. Some opined that George W. Bush considered it his duty to finish the job started, but for some obscure reason not completed, by his father at the time of the Gulf War; others believe that Bush Junior expected a short and triumphant war which would guarantee him a second term in the White House.

I believe that we must look elsewhere for an explanation for the attitude of the American President.

The fact that Bush is keen on war has little or nothing to do with his psyche, but a great deal with the American economic system. This system – America’s brand of capitalism – functions first and foremost to make extremely rich Americans like the Bush “money dynasty” even richer. Without warm or cold wars, however, this system can no longer produce the expected result in the form of the ever-higher profits the moneyed and powerful of America consider as their birthright.

The great strength of American capitalism is also its great weakness, namely, its extremely high productivity. In the historical development of the international economic system that we call capitalism, a number of factors have produced enormous increases in productivity, for example, the mechanization of the production process that got under way in England as early as the 18th century. In the early 20th century, then, American industrialists made a crucial contribution in the form of the automatization of work by means of new techniques such as the assembly line. The latter was an innovation introduced by Henry Ford, and those techniques have therefore become collectively known as “Fordism.” The productivity of the great American enterprises rose spectacularly.

For example, already in the 1920s, countless vehicles rolled off the assembly lines of the automobile factories of Michigan every single day. But who was supposed to buy all those cars? Most Americans at the time did not have sufficiently robust pocket books for such a purchase. Other industrial products similarly flooded the market, and the result was the emergence of a chronic disharmony between the ever-increasing economic supply and the lagging demand. Thus arose the economic crisis generally known as the Great Depression. It was essentially a crisis of overproduction. Warehouses were bursting with unsold commodities, factories laid off workers, unemployment exploded, and so the purchasing power of the American people shrunk even more, making the crisis even worse.

It cannot be denied that in America the Great Depression only ended during, and because of, the Second World War. (Even the greatest admirers of President Roosevelt admit that his much-publicized New Deal policies brought little or no relief.) Economic demand rose spectacularly when the war which had started in Europe, and in which the USA itself was not an active participant before 1942, allowed American industry to produce unlimited amounts of war equipment. Between 1940 and 1945, the American state would spend no less than 185 billion dollar on such equipment, and the military expenditures’ share of the GNP thus rose between 1939 and 1945 from an insignificant 1,5 per cent to approximately 40 per cent. In addition, American industry also supplied gargantuan amounts of equipment to the British and even the Soviets via Lend-Lease. (In Germany, meanwhile, the subsidiaries of American corporations such as Ford, GM, and ITT produced all sorts of planes and tanks and other martial toys for the Nazi’s, also after Pearl Harbor, but that is a different story.) The key problem of the Great Depression – the disequilibrium between supply and demand – was thus resolved because the state “primed the pump” of economic demand by means of huge orders of a military nature.

As far as ordinary Americans were concerned, Washington’s military spending orgy brought not only virtually full employment but also much higher wages than ever before; it was during the Second World War that the widespread misery associated with the Great Depression came to an end and that a majority of the American people achieved an unprecedented degree of prosperity. However, the greatest beneficiaries by far of the wartime economic boom were the country’s businesspeople and corporations, who realized extraordinary profits. Between 1942 and 1945, writes the historian Stuart D. Brandes, the net profits of America’s 2,000 biggest firms were more than 40 per cent higher than during the period 1936-1939. Such a “profit boom” was possible, he explains, because the state ordered billions of dollars of military equipment, failed to institute price controls, and taxed profits little if at all. This largesse benefited the American business world in general, but in particular that relatively restricted elite of big corporations known as “big business” or “corporate America.” During the war, a total of less than 60 firms obtained 75 per cent of all lucrative military and other state orders. The big corporations – Ford, IBM, etc. – revealed themselves to be the “war hogs,” writes Brandes, that gormandized at the plentiful trough of the state’s military expenditures. IBM, for example, increased its annual sales between 1940 and 1945 from 46 to 140 million dollar thanks to war-related orders, and its profits skyrocketed accordingly.

America’s big corporations exploited their Fordist expertise to the fullest in order to boost production, but even that was not sufficient to meet the wartime needs of the American state. Much more equipment was needed, and in order to produce it, America needed new factories and even more efficient technology. These new assets were duly stamped out of the ground, and on account of this the total value of all productive facilities of the nation increased between 1939 and 1945 from 40 to 66 billion dollar. However, it was not the private sector that undertook all these new investments; on account of its disagreeable experiences with overproduction during the thirties, America’s businesspeople found this task too risky. So the state did the job by investing 17 billion dollar in more than 2,000 defense-related projects. In return for a nominal fee, privately owned corporations were permitted to rent these brand-new factories in order to produce…and to make money by selling the output back to the state. Moreover, when the war was over and Washington decided to divest itself of these investments, the nation’s big corporations purchased them for half, and in many cases only one third, of the real value.

How did America finance the war, how did Washington pay the lofty bills presented by GM, ITT, and the other corporate suppliers of war equipment? The answer is: partly by means of taxation – about 45 per cent -, but much more through loans – approximately 55 per cent. On account of this, the public debt increased dramatically, namely, from 3 billion dollar in 1939 to no less than 45 billion dollar in 1945. In theory, this debt should have been reduced, or wiped out altogether, by levying taxes on the huge profits pocketed during the war by America’s big corporations, but the reality was different. As already noted, the American state failed to meaningfully tax corporate America’s windfall profits, allowed the public debt to mushroom, and paid its bills, and the interest on its loans, with its general revenues, that is, by means of the income generated by direct and indirect taxes. Particularly on account of the regressive Revenue Act introduced in October 1942, these taxes were paid increasingly by workers and other low-income Americans, rather than by the super-rich and the corporations of which the latter were the owners, major shareholders, and/or top managers. “The burden of financing the war,” observes the American historian Sean Dennis Cashman, “[was] sloughed firmly upon the shoulders of the poorer members of society.”

However, the American public, preoccupied by the war and blinded by the bright sun of full employment and high wages, failed to notice this. Affluent Americans, on the other hand, were keenly aware of the wonderful way in which the war generated money for themselves and for their corporations. Incidentally, it was also from the rich businesspeople, bankers, insurers and other big investors that Washington borrowed the money needed to finance the war; corporate America thus also profited from the war by pocketing the lion’s share of the interests generated by the purchase of the famous war bonds. In theory, at least, the rich and powerful of America are the great champions of so-called free enterprise, and they oppose any form of state intervention in the economy. During the war, however, they never raised any objections to the way in which the American state managed and financed the economy, because without this large-scale dirigist violation of the rules of free enterprise, their collective wealth could never have proliferated as it did during those years.

During the Second World War, the wealthy owners and top managers of the big corporations learned a very important lesson: during a war there is money to be made, lots of money. In other words, the arduous task of maximizing profits – the key activity within the capitalist American economy – can be absolved much more efficiently through war than through peace; however, the benevolent cooperation of the state is required. Ever since the Second World War, the rich and powerful of America have remained keenly conscious of this. So is their man in the White House today [2003, i.e. George W. Bush], the scion of a “money dynasty” who was parachuted into the White House in order to promote the interests of his wealthy family members, friends, and associates in corporate America, the interests of money, privilege, and power.

In the spring of 1945 it was obvious that the war, fountainhead of fabulous profits, would soon be over. What would happen then? Among the economists, many Cassandras conjured up scenarios that loomed extremely unpleasant for America’s political and industrial leaders. During the war, Washington’s purchases of military equipment, and nothing else, had restored the economic demand and thus made possible not only full employment but also unprecedented profits. With the return of peace, the ghost of disharmony between supply and demand threatened to return to haunt America again, and the resulting crisis might well be even more acute than the Great Depression of the “dirty thirties,” because during the war years the productive capacity of the nation had increased considerably, as we have seen. Workers would have to be laid off precisely at the moment when millions of war veterans would come home looking for a civilian job, and the resulting unemployment and decline in purchasing power would aggravate the demand deficit. Seen from the perspective of America’s rich and powerful, the coming unemployment was not a problem; what did matter was that the golden age of gargantuan profits would come to an end. Such a catastrophe had to be prevented, but how?

Military state expenditures were the source of high profits. In order to keep the profits gushing forth generously, new enemies and new war threats were urgently needed now that Germany and Japan were defeated. How fortunate that the Soviet Union existed, a country which during the war had been a particularly useful partner who had pulled the chestnuts out of the fire for the Allies in Stalingrad and elsewhere, but also a partner whose communist ideas and practices allowed it to be easily transformed into the new bogeyman of the United States. Most American historians now admit that in 1945 the Soviet Union, a country that had suffered enormously during the war, did not constitute a threat at all to the economically and militarily far superior USA, and that Washington itself did not perceive the Soviets as a threat. These historians also acknowledge that Moscow was very keen to work closely together with Washington in the postwar era.

Indeed, Moscow had nothing to gain, and everything to lose, from a conflict with superpower America, which was brimming with confidence thanks to its monopoly of the atom bomb. However, America – corporate America, the America of the super-rich – urgently needed a new enemy in order to justify the titanic expenditures for “defense” which were needed to keep the wheels of the nation’s economy spinning at full speed also after the end of the war, thus keeping profit margins at the required – or rather, desired – high levels, or even to increase them. It is for this reason that the Cold War was unleashed in 1945, not by the Soviets but by the American “military-industrial” complex, as President Eisenhower would call that elite of wealthy individuals and corporations that knew how to profit from the “warfare economy.”

In this respect, the Cold War exceeded their fondest expectations. More and more martial equipment had to be cranked out, because the allies within the so-called “free world”, which actually included plenty of nasty dictatorships, had to be armed to the teeth with US equipment. In addition, America’s own armed forces never ceased demanding bigger, better, and more sophisticated tanks, planes, rockets, and, yes, chemical and bacteriological weapons and other weapons of mass destruction. For these goods, the Pentagon was always ready to pay huge sums without asking difficult questions. As had been the case during the Second World War, it was again primarily the large corporations who were allowed to fill the orders. The Cold War generated unprecedented profits, and they flowed into the coffers of those extremely wealthy individuals who happened to be the owners, top managers, and/or major shareholders of these corporations. (Does it come as a surprise that in the United States newly retired Pentagon generals are routinely offered jobs as consultants by large corporations involved in military production, and that businessmen linked with those corporations are regularly appointed as high-ranking officials of the Department of Defense, as advisors of the President, etc.?)

During the Cold War too, the American state financed its skyrocketing military expenditures by means of loans, and this caused the public debt to rise to dizzying heights. In 1945 the public debt stood at “only” 258 billion dollar, but in 1990 – when the Cold War ground to an end – it amounted to no less than 3.2 trillion dollar! This was a stupendous increase, also when one takes the inflation rate into account, and it caused the American state to become the world’s greatest debtor. (Incidentally, in July 2002 the American public debt had reached 6.1 trillion dollar.) Washington could and should have covered the cost of the Cold War by taxing the huge profits achieved by the corporations involved in the armament orgy, but there was never any question of such a thing. In 1945, when the Second World War come to an end and the Cold War picked up the slack, corporations still paid 50 per cent of all taxes, but during the course of the Cold War this share shrunk consistently, and today it only amounts to approximately 1 per cent.

This was possible because the nation’s big corporations largely determine what the government in Washington may or may not do, also in the field of fiscal policy. In addition, lowering the tax burden of corporations was made easier because after the Second World War these corporations transformed themselves into multinationals, “at home everywhere and nowhere,” as an American author has written in connection with ITT, and therefore find it easy to avoid paying meaningful taxes anywhere. Stateside, where they pocket the biggest profits, 37 per cent of all American multinationals – and more than 70 per cent of all foreign multinationals – paid not a single dollar of taxes in 1991, while the remaining multinationals remitted less than 1 per cent of their profits in taxes.

The sky-high costs of the Cold War were thus not borne by those who profited from it and who, incidentally, also continued to pocket the lion’s share of the dividends paid on government bonds, but by the American workers and the American middle class. These low- and middle-income Americans did not receive a penny from the profits yielded so profusely by the Cold War, but they did receive their share of the enormous public debt for which that conflict was largely responsible. It is they, therefore, who were really saddled with the costs of the Cold War, and it is they who continue to pay with their taxes for a disproportionate share of the burden of the public debt.

In other words, while the profits generated by the Cold War were privatized to the advantage of an extremely wealthy elite, its costs were ruthlessly socialized to the great detriment of all other Americans. During the Cold War, the American economy degenerated into a gigantic swindle, into a perverse redistribution of the nation’s wealth to the advantage of the rich and to the disadvantage not only of the poor and of the working class but also of the middle class, whose members tend to subscribe to the myth that the American capitalist system serves their interests. Indeed, while the wealthy and powerful of America accumulated ever-greater riches, the prosperity achieved by many other Americans during the Second World War was gradually eroded, and the general standard of living declined slowly but steadily.

During the Second World War America had witnessed a modest redistribution of the collective wealth of the nation to the advantage of the less privileged members of society. During the Cold War, however, the rich Americans became richer while the non-wealthy – and certainly not only the poor – became poorer. In 1989, the year the Cold War petered out, more than 13 per cent of all Americans – approximately 31 million individuals – were poor according to the official criteria of poverty, which definitely understate the problem. Conversely, today 1 per cent of all Americans own no less than 34 per cent of the nation’s aggregate wealth. In no major “Western” country is the wealth distributed more unevenly.

The minuscule percentage of super-rich Americans found this development extremely satisfactory. They loved the idea of accumulating more and more wealth, of aggrandizing their already huge assets, at the expense of the less privileged. They wanted to keep things that way or, if at all possible, make this sublime scheme even more efficient. However, all good things must come to an end, and in 1989/90 the bountiful Cold War elapsed. That presented a serious problem. Ordinary Americans, who knew that they had borne the costs of this war, expected a “peace dividend.”

They thought that the money the state had spent on military expenditures might now be used to produce benefits for themselves, for example in the form of a national health insurance and other social benefits which Americans in contrast to most Europeans have never enjoyed. In 1992, Bill Clinton would actually win the presidential election by dangling out the prospect of a national health plan, which of course never materialized. A “peace dividend” was of no interest whatsoever to the nation’s wealthy elite, because the provision of social services by the state does not yield profits for entrepreneurs and corporations, and certainly not the lofty kind of profits generated by military state expenditures. Something had to be done, and had to be done fast, to prevent the threatening implosion of the state’s military spending.

America, or rather, corporate America, was orphaned of its useful Soviet enemy, and urgently needed to conjure up new enemies and new threats in order to justify a high level of military spending. It is in this context that in 1990 Saddam Hussein appeared on the scene like a kind ofdeus ex machina. This tin-pot dictator had previously been perceived and treated by the Americans as a good friend, and he had been armed to the teeth so that he could wage a nasty war against Iran; it was the USA – and allies such as Germany – who originally supplied him with all sorts of weapons. However, Washington was desperately in need of a new enemy, and suddenly fingered him as a terribly dangerous “new Hitler,” against whom war needed to be waged urgently, even though it was clear that a negotiated settlement of the issue of Iraq’s occupation of Kuwait was not out of the question.

George Bush Senior was the casting agent who discovered this useful new nemesis of America, and who unleashed the Gulf War, during which Baghdad was showered with bombs and Saddam’s hapless recruits were slaughtered in the desert. The road to the Iraqi capital lay wide-open, but the Marines’ triumphant entry into Baghdad was suddenly scrapped. Saddam Hussein was left in power so that the threat he was supposed to form might be invoked again in order to justify keeping America in arms. After all, the sudden collapse of the Soviet Union had shown how inconvenient it can be when one loses a useful foe.

And so Mars could remain the patron saint of the American economy or, more accurately, the godfather of the corporate Mafia that manipulates this war-driven economy and reaps its huge profits without bearing its costs. The despised project of a peace dividend could be unceremoniously buried, and military expenditures could remain the dynamo of the economy and the wellspring of sufficiently high profits. Those expenditures increased relentlessly during the 1990s. In 1996, for example, they amounted to no less than 265 billion dollars, but when one adds the unofficial and/or indirect military expenditures, such as the interests paid on loans used to finance past wars, the 1996 total came to approximately 494 billion dollar, amounting to an outlay of 1.3 billion dollar per day! However, with only a considerably chastened Saddam as bogeyman, Washington found it expedient also to look elsewhere for new enemies and threats. Somalia temporarily looked promising, but in due course another “new Hitler” was identified in the Balkan Peninsula in the person of the Serbian leader, Milosevic. During much of the nineties, then, conflicts in the former Yugoslavia provided the required pretexts for military interventions, large-scale bombing operations, and the purchase of more and newer weapons.

The “warfare economy” could thus continue to run on all cylinders also after the Gulf War. However, in view of occasional public pressure such as the demand for a peace dividend, it is not easy to keep this system going. (The media present no problem, as newspapers, magazines, TV stations, etc. are either owned by big corporations or rely on them for advertising revenue.) As mentioned earlier, the state has to cooperate, so in Washington one needs men and women one can count upon, preferably individuals from the very own corporate ranks, individuals totally committed to use the instrument of military expenditures in order to provide the high profits that are needed to make the very rich of America even richer. In this respect, Bill Clinton had fallen short of expectations, and corporate America could never forgive his original sin, namely, that he had managed to have himself elected by promising the American people a “peace dividend” in the form of a system of health insurance.

On account of this, in 2000 it was arranged that not the Clinton-clone Al Gore moved into the White House but a team of militarist hardliners, virtually without exception representatives of wealthy, corporate America, such as Cheney, Rumsfeld, and Rice, and of course George W. Bush himself, son of the man who had shown with his Gulf War how it could be done; the Pentagon, too, was directly represented in the Bush Cabinet in the person of the allegedly peace-loving Powell, in reality yet another angel of death. Rambo moved into the White House, and it did not take long for the results to show.

After Bush Junior had been catapulted into the presidency, it looked for some time as if he was going to proclaim China as the new nemesis of America. However, a conflict with that giant loomed somewhat risky; furthermore, all too many big corporations make good money by trading with the People’s Republic. Another threat, preferably less dangerous and more credible, was required to keep the military expenditures at a sufficiently high level. For this purpose, Bush and Rumsfeld and company could have wished for nothing more convenient than the events of September 11, 2001; it is extremely likely that they were aware of the preparations for these monstrous attacks, but that they did nothing to prevent them because they knew that they would be able to benefit from them. In any event, they did take full advantage of this opportunity in order to militarize America more than ever before, to shower bombs on people who had nothing to do with 9/11, to wage war to their hearts’ content, and thus for corporations that do business with the Pentagon to ring up unprecedented sales. Bush declared war not on a country but on terrorism, an abstract concept against which one cannot really wage war and against which a definitive victory can never be achieved. However, in practice the slogan “war against terrorism” meant that Washington now reserves the right to wage war worldwide and permanently against whomever the White House defines as a terrorist.

And so the problem of the end of the Cold War was definitively resolved, as there was henceforth a justification for ever-increasing military expenditures. The statistics speak for themselves. The 1996 total of 265 billion dollar in military expenditures had already been astronomical, but thanks to Bush Junior the Pentagon was allowed to spend 350 billion in 2002, and for 2003 the President has promised approximately 390 billion; however, it is now virtually certain that the cape of 400 billion dollar will be rounded this year. (In order to finance this military spending orgy, money has to be saved elsewhere, for example by cancelling free lunches for poor children; every little bit helps.) No wonder that George W. struts around beaming with happiness and pride, for he – essentially a spoiled rich kid of very limited talent and intellect – has surpassed the boldest expectations not only of his wealthy family and friends but of corporate America as a whole, to which he owes his job.

9/11 provided Bush with carte blanche to wage war wherever and against whomever he chose, and as this essay has purported to make clear, it does not matter all that much who happens to be fingered as enemy du jour. Last year, Bush showered bombs on Afghanistan, presumably because the leaders of that country sheltered Bin Laden, but recently the latter went out of fashion and it was once again Saddam Hussein who allegedly threatened America. We cannot deal here in detail with the specific reasons why Bush’s America absolutely wanted war with the Iraq of Saddam Hussein and not with, say, North Korea. A major reason for fighting this particular war was that Iraq’s large reserves of oil are lusted after by the US oil trusts with whom the Bushes themselves – and Bushites such as Cheney and Rice, after whom an oil tanker happens to be named – are so intimately linked. The war in Iraq is also useful as a lesson to other Third World countries who fail to dance to Washington’s tune, and as an instrument for emasculating domestic opposition and ramming the extreme right-wing program of an unelected president down the throats of Americans themselves.

The America of wealth and privilege is hooked on war, without regular and ever-stronger doses of war it can no longer function properly, that is, yield the desired profits. Right now, this addiction, this craving is being satisfied by means of a conflict against Iraq, which also happens to be dear to the hearts of the oil barons. However, does anybody believe that the warmongering will stop once Saddam’ scalp will join the Taliban turbans in the trophy display case of George W. Bush? The President has already pointed his finger at those whose turn will soon come, namely, the “axis of evil” countries: Iran, Syria, Lybia, Somalia, North Korea, and of course that old thorn in the side of America, Cuba. Welcome to the 21st century, welcome to George W. Bush’s brave new era of permanent war!

Jacques R. Pauwels is historian and political scientist, author of ‘The Myth of the Good War: America in the Second World War’ (James Lorimer, Toronto, 2002). His book is published in different languages: in English, Dutch, German, Spanish, Italian and French. Together with personalities like Ramsey Clark, Michael Parenti, William Blum, Robert Weil, Michel Collon, Peter Franssen and many others… he signed “The International Appeal against US-War”.


From the International Press on Saturday, March 22, 2003:

The cost to the United States of the war in Iraq and its aftermath could easily exceed $100 billion…Peace-keeping in Iraq and rebuilding the country’s infrastructure could add much more…The Bush administration has stayed tightlipped about the cost of the war and reconstruction…Both the White House and the Pentagon refused to offer any definite figures.
(The International Herald Tribune, 22/03/03)

It is estimated that the war against Iraq will cost approximately 100 billion dollar. In contrast to the Gulf War of 1991, whose cost of 80 million was shared by the Allies, the United States is expected to pay the entire cost of the present war…For the American private sector, i.e. the big corporations, the coming reconstruction of Iraq’s infrastructure will represent a business of 900 million dollar; the first contracts were awarded yesterday (March 21) by the American government to two corporations. (Guido Leboni, “Un coste de 100.000 millones de dolares,” El Mundo, Madrid, 22/03/03)

Terrifying Technicals: This Chartist Predicts An Anti-Fed Revulsion, And A Plunge In The S&P To 450 | Zero Hedge

Terrifying Technicals: This Chartist Predicts An Anti-Fed Revulsion, And A Plunge In The S&P To 450 | Zero Hedge.

Via Walter J. Zimmermann Jr. of United-ICAP,

Sooner or later everyone sits down to a banquet of consequences.”

– Robert Louis Stevenson

Main Points

1. History is written as much by the unforeseen consequences of key events as by the events themselves. We prefer not to think in these terms, but history clearly reveals that the adverse consequences of well intended efforts often have a much more dramatic and lasting impact than the original efforts themselves.

2. In fact history suggests a law of adverse consequences where the more insistent and forceful the well intended effort, the more dramatic, powerful and harmful the blowback. In simple terms,attempts to force the world to improve have always ended badly.

3. This law of adverse consequences is a very common phenomena in medicine and is known by the euphemism of ‘side effects’. Adverse drug reactions to prescribed medications are the fourth leading killer in America, right after heart disease, cancer, and stroke. However this expression of the law of unintended consequences gets even less press than its expressions in human history. Neither is a popular topic.

4. One could easily write several volumes of history focused exclusively on the unwelcome repercussions from otherwise well-intended efforts. However as this is a subject that we would all rather avoid I suspect it would be a very difficult book to market.

5. Instead of a book I have opted for two pages of examples. The present situation strongly suggests that the high risk of unexpected blowback from current economic policies are much more deserving of our full attention than the past history of unwelcome consequences.

6. QE has already created what is arguably the most bullish market sentiment in history. And that extreme bullish sentiment has already driven most stock indices to new all time highs. So now would be a good time for some sober reflections on what could go wrong.

7. One sector that seems dangerously poised to go badly wrong are the junk and emerging bond markets. What will happen when Treasuries start yielding the same rates as previously issued junk debt? A massive exodus will happen. Junk bonds and emerging market debt will become a disaster area.

8. We already know how wildly successful Fed stimulus has been at creating speculative bubbles. Fed inflated bubbles that have already burst include a Dot-Com bubble, a credit bubble, a real estate bubble, and a commodity market bubble. The biggest bubble of them all is still inflating. That would be this stock market bubble.

9. There are now fewer banks than ever before in modern history. And the biggest banks are larger than ever before in history. The war against ‘too big to fail’ was lost before it began. Fewer, bigger banks means a more fragile financial system.

10. The worst of the bullish sentiment extremes of previous major stock market peaks have all returned. Analysts are positively gushing with ebullience. There is a competition to see who can come up with the highest targets for the various stock indices. No one sees any downside risk. All are confident that the Fed can and will fix anything. This is a situation ripe for adverse consequences. This is a market where blowback will be synonymous with blind-sided. No one will prepare for what they cannot see coming.

Comparing Costs: Major US Wars versus Quantitative Easing

The chart above suggests that the magnitude of the Federal Reserve economic stimulus program is only comparable to previous major war efforts. The dollar costs plotted here bears that out.

War Costs

All of the war costs on the previous page were taken from one report dated 29 June 2010. That report was prepared by Stephen Dagget at the Congressional Research Service. I adjusted his numbers to 2013 dollars. You can find his report in PDF format on-line. However some further comments may be useful here.

Civil War

The Civil War number combines the Northern or Union costs and the Southern or Confederate costs. In 2011 dollars the price of waging the war for the Union was $59.6 billion dollars and $20.1 billion for the Confederacy. I simply added these two numbers and then converted to 2013 dollars.

Post 9/11 Wars

Here I combined the costs of the Persian Gulf war, and Iraq war, and the war in Afghanistan into one category and then adjusted to 2013 dollars.

Sending a Man to the Moon

I thought it would be interesting to compare the costs of sending a man to the moon to the costs of QE. Most references to the cost of putting a man on the Moon only cite the Apollo project. But of course that is very wrong. Apollo arose from Gemini which grew out of Mercury. So for the true cost of sending a man to the Moon I included all costs for the Mercury missions, the Gemini program, the Lunar probes, the Apollo capsules, the Saturn V rockets, and the Lunar Modules. I relied on numbers gathered from NASA by the Artemis Project. I then converted those costs to 2013 dollars.

World War II versus Quantitative Easing

WW II

World War II transformed the United States from a sleepy agricultural enterprise into the world’s dominant economic super-power, and defeated both Nazi Germany and Imperial Japan at the same time. It may seem entirely callous to calculate US Dollar costs for a war that claimed 15,000,000 battle deaths, 25,000,000 battle wounded, and civilian deaths that exceeded 45,000,000 but there is a point to this exercise.

The second world war defeated the strategy of geographical conquest through militarism as a national policy. Of course WW II had it’s own undesirable blowback as anything on this gigantic a scale would. However it seems pretty clear that replacing fascism and militarism with democracy was a step of progress for mankind.

WW II and QE

Since the 1950’s many have argued that it took World War II to pull the world out of the Great Depression. As a life-long student of the Great Depression Bernanke must be aware of this debate. In terms of the dollar amounts involved, World War Two is the only project comparable in size to QE. So it seems reasonable to assume that Bernanke’s goal here is to have QE fulfill the economic role of a World War Three; a war-free method of pulling the world out of the Great Recession. However human history suggests that the sheer magnitude and forced nature of the QE program all but ensures serious, unexpected and adverse consequences.

Learning from History

I am not bearish on the human race. When I read history I see things getting better. When I read history I find the slow replacement of brutality with compassion. When I read history I find the long term trend to be the replacement of centralized authority with local self-determination. And I find that every single effort to fight these long term trends has failed. And as history continues to unfold the efforts to fight these trends tends to fail more quickly, more dramatically, and more decisively.

There is an ancient Chinese proverb that states “Plan too far ahead and nature will seem to resist.” That aphorism definitely resonates with my experience and observations. If there is something inherent in the flow of time that unfolds an improvement in the human condition, then there is also something in the nature of things that resists the application of force, whether well intended or not.

If all of the above is an accurate accounting of things, then the key issue for policy makers is finding the fine line that separates supporting the natural flow of human evolution from attempting to force change. The former will help while the later will end badly. The question today has to do with Quantitative Easing. Is QE a gentle nurturing of economic evolution or is it the next doomed attempt to force things to get better? The QE program is so enormous, and relentless, and insistent, that I fear it is the later. And if QE is a huge attempt to force the economy to improve, than we had better start bracing for the blowback.

QE: the blowback to come

What kind of blowback should we prepare for? The lesson of history is that trying to force things to get better does not merely create unwelcome repercussions. It does not merely slow the pace of natural evolution. Attempts to enforce a certain outcome always appears to create the opposite effect. We do not find a law of adverse consequences. We find a law of opposite impacts.

Let us review the sample examples from the previous charts. Every effort to jam an ideology or a plan down the throat of the world only creates the opposite of the intended effect. I would maintain that this is one of the few lessons from history that can be relied on.

If the Federal Reserve is trying to force feed us prosperity then the inevitable blowback will be adversity. If the Fed is trying to compel the most dramatic economic recovery in history, then the blowback may well be the deepest depression in history. If the Fed is trying to enforce confidence and optimism then the blowback will be fear and despair. If the Fed is trying to force consumers to spend then the blowback will be a collapse in consumer confidence.

I sincerely hope that I am completely wrong here, that I am missing something, that there is a flaw in my logic. However until I can locate such a flaw I must trust the technical case for treating this Fed force-fed rally in the stock market as something that will end badly.

Here’s how it plays out…

 

 

Joseph S. Nye asks whether war between China and the US is as inevitable as many believe World War I to have been. – Project Syndicate

Joseph S. Nye asks whether war between China and the US is as inevitable as many believe World War I to have been. – Project Syndicate.

CAMBRIDGE – This year marks the hundredth anniversary of a transformative event of modern history. World War I killed some 20 million people and ground up a generation of Europe’s youth. It also fundamentally changed the international order in Europe and beyond.

Indeed, WWI destroyed not only lives, but also three empires in Europe – those of Germany, Austria-Hungary, and Russia – and, with the collapse of Ottoman rule, a fourth on its fringe. Until the Great War, the global balance of power was centered in Europe; after it, the United States and Japan emerged as great powers. The war also ushered in the Bolshevik Revolution of 1917, prepared the way for fascism, and intensified and broadened the ideological battles that wracked the twentieth century.

How could such a catastrophe happen? Shortly after the war broke out, when German Chancellor Theobald von Bethmann-Hollweg was asked to explain what happened, he answered, “Oh, if I only knew!” Perhaps in the interest of self-exoneration, he came to regard the war as inevitable. Similarly, the British Foreign Minister, Sir Edward Grey, argued that he had “come to think that no human individual could have prevented it.”

The question we face today is whether it could happen again. Margaret MacMillan, author of the interesting new book The War that Ended Peaceargues that, “it is tempting – and sobering – to compare today’s relationship between China and the US with that between Germany and Britain a century ago.” After drawing a similar comparison, The Economist concludes that “the most troubling similarity between 1914 and now is complacency.” And some political scientists, such as John Mearsheimer of the University of Chicago, have argued that, “to put it bluntly: China cannot rise peacefully.”

But historical analogies, though sometimes useful for precautionary purposes, become dangerous when they convey a sense of historical inevitability. WWI was not inevitable. It was made more probable by Germany’s rising power and the fear that this created in Great Britain. But it was also made more probable by Germany’s fearful response to Russia’s rising power, as well as myriad other factors, including human errors. But the gap in overall power between the US and China today is greater than that between Germany and Britain in 1914.

Drawing contemporary lessons from 1914 requires dispelling the many myths have been created about WWI. For example, the claim that it was a deliberate preventive war by Germany is belied by the evidence showing that key elites did not believe this. Nor was WWI a purely accidental war, as others maintain: Austria went to war deliberately, to fend off the threat of rising Slavic nationalism. There were miscalculations over the war’s length and depth, but that is not the same as an accidental war.

It is also said that the war was caused by an uncontrolled arms race in Europe. But the naval arms race was over by 1912, and Britain had won. While there was concern in Europe about the growing strength of armies, the view that the war was precipitated directly by the arms race is facile.

Today’s world is different from the world of 1914 in several important ways. One is that nuclear weapons give political leaders the equivalent of a crystal ball that shows what their world would look like after escalation. Perhaps if the Emperor, the Kaiser, and the Czar had had a crystal ball showing their empires destroyed and their thrones lost in 1918, they would have been more prudent in 1914. Certainly, the crystal-ball effect had a strong influence on US and Soviet leaders during the Cuban missile crisis. It would likely have a similar influence on US and Chinese leaders today.

Another difference is that the ideology of war is much weaker nowadays. In 1914, war really was thought to be inevitable, a fatalistic view reinforced by the Social Darwinist argument that war should be welcomed, because it would “clear the air” like a good summer storm. As Winston Churchill wrote in The World Crisis:

“There was a strange temper in the air. Unsatisfied by material prosperity, the nations turned fiercely toward strife, internal or external. National passions, unduly exalted in the decline of religion, burned beneath the surface of nearly every land with fierce, if shrouded, fires. Almost one might think the world wished to suffer. Certainly men were everywhere eager to dare.”

To be sure, nationalism is growing in China today, while the US launched two wars after the September 11, 2001, attacks. But neither country is bellicose or complacent about a limited war. China aspires to play a larger role in its region, and the US has regional allies to whose defense it is committed. Miscalculations are always possible, but the risk can be minimized by the right policy choices. Indeed, on many issues – for example, energy, climate change, and financial stability – China and the US have strong incentives to cooperate.

Moreover, whereas Germany in 1914 was pressing hard on Britain’s heels (and had surpassed it in terms of industrial strength), the US remains decades ahead of China in overall military, economic, and soft-power resources. Too adventuresome a policy would jeopardize China’s gains at home and abroad.

In other words, the US has more time to manage its relations with a rising power than Britain did a century ago. Too much fear can be self-fulfilling. Whether the US and China will manage their relationship well is another question. But how they do so will be dictated by human choice, not some ironclad historical law.

Among the lessons to be learned from the events of 1914 is to be wary of analysts wielding historical analogies, particularly if they have a whiff of inevitability. War is never inevitable, though the belief that it is can become one of its causes.

Read more at http://www.project-syndicate.org/commentary/joseph-s–nye-asks-whether-war-between-china-and-the-us-is-as-inevitable-as-many-believe-world-war-i-to-have-been#FTTehJIsCzqkHKMX.99

Japan Population Falls by Record in Challenge for Abe’s Campaign – Bloomberg

Japan Population Falls by Record in Challenge for Abe’s Campaign – Bloomberg.

Japan’s population declined by the most on record in 2013, highlighting the demographic challenges faced by Prime Minister Shinzo Abe in his campaign to revive the world’s third-biggest economy.

The population fell by 244,000, according to Health Ministry estimates released yesterday, a seventh straight year of decline. Births fell about 6,000 from a year earlier to 1,031,000 and deaths increased about 19,000 to 1,275,000.

Rising welfare costs for an ageing nation threaten to worsen a debt burden that is already twice the size of the Japanese economy. At the same time, a shrinking population caps consumer demand, making it harder for Abe to drive an exit from 15 years of deflation.

The government’s decision to raise a sales tax to 8 percent from 5 percent in April is aimed at helping to secure funds for social welfare payments. That move threatens to undermine the momentum building in the economy from unprecedented monetary stimulus.

 

How to Prevent a War Between China and Japan – Bloomberg

How to Prevent a War Between China and Japan – Bloomberg.

Photos: Getty Images; Illustration by A. Babar

China and Japan, Asia’s two most powerful nations, are increasingly jousting in the skies and in the seas near a set of disputed islands. Although their economies remain deeply intertwined, relations between the two governments seem locked in an irreversible, dangerous downward spiral.

Japanese Prime Minister Shinzo Abe further embittered feelings last week by visiting the controversial Yasukuni shrine, which honors the souls of Japan’s war dead, including 14 World War II leaders convicted as Class-A war criminals.

Needless to say, neither side seems terribly interested in a rapprochement. That’s a shame, because the deterioration in ties is fairly recent, stemming from a single incident involving the islands administered by Japan, which calls them the Senkakus, and claimed by China, which refers to them as the Diaoyu. A single, symbolic-but-generous gesture could well halt the slide.

Abe, though unquestionably a hawk on China, had nothing to do with the triggering event. In September 2012, then-Prime Minister Yoshihiko Noda ordered his government to buy several of the disputed islands from a private owner — an action which, in China’s view, effectively nationalized them.

Noda hadn’t intended to provoke the Chinese. On the contrary, he aimed to preempt a more aggressive gesture by hyper-nationalist politician Shintaro Ishihara — then Tokyo’s governor — who wanted to have the Tokyo metropolitan government purchase the islands and build on them to assert Japan’s sovereignty.

Still, barely two days before Noda’s decision, China’s then-President Hu Jintao had specifically warned him not to proceed. Hu’s concerns were legitimate. For years, China had quietly acceptedJapan’s “de facto” occupation of the islands even as it disputed sovereignty. By buying them, Japan appeared to be moving to “de jure” ownership. Given the nationalist mood in China, the Beijing government couldn’t risk appearing weak in its response.

If Abe really wanted to break the chain of escalation that has since played out between China and Japan, he could singlehandedly return to the status quo ante. He would only need to “sell” the islands to a private Japanese foundation or environmental group, ostensibly to preserve their undeveloped natural beauty.

Japanese hard-liners would no doubt regard such a move as a capitulation to China. It wouldn’t be. Even after a sale, Japan would continue its de facto occupation of the islands, as it has for decades. Since the islands’ purchase was made by a previous government, Abe’s Liberal Democrats need not feel bound by the decision. In fact, after pacifying his nationalist supporters by visiting Yasukuni, Abe may be in a stronger position to compromise on the islands.

In an interview with Bloomberg earlier this month, Abe called for a summit with President Xi Jinping of China and said, “Now is the time to go back to that starting point.” Abe was referring to a bilateral agreement he reached with Hu in 2006, during a previous term as Japan’s prime minister. Selling the islands would be a critical first step toward returning to that calmer time.

If Abe wanted to be bolder, he could make the same offer to China that Japan has made to South Korea over a different set of disputed islands: to have the issue resolved by the International Court of Justice. The chances of China agreeing to this are minuscule. But by taking the moral high ground, Japan would both reaffirm its reasonableness, and satisfy the major precondition China has imposed on any Xi-Abe summit — acknowledging that sovereignty of the Senkakus/Diaoyu is in dispute.

Of course, if it’s hard to imagine an Abe administration reaching out to Beijing now, it’s equally hard to see Chinese leaders responding constructively. Yet on a simple cost-benefit analysis, Xi has incentive enough to scale back aggressive naval and air patrols of the waters surrounding the islands. He has just embarked on a set of difficult, potentially far-reaching economic reforms. Although he can’t afford to look weak domestically, he also can’t afford a geopolitical crisis that would disrupt China’s economy and possibly global trade.

A major rebalancing is gradually taking place in Asia as China’s economy becomes larger than Japan’s. But it isn’t in China’s interest to push for this rebalancing too aggressively. When I was in Tokyo in early December, I was struck by the intensity of concern over China’s aggressive posturing. The harder the Beijing government pushes now, the more rapidly Japan will move to upgrade its military capabilities and strengthen its alliances with the U.S. and countries ringing China.

Both sides need to find a way to ratchet down their words and deeds. Japan can and should take a first, small step forward by “going back” and selling the islands. Any Japanese leaders who doubt the wisdom of doing so should ask themselves a question: Are they really better off today than they were two years ago?

(Kishore Mahbubani, dean of the Lee Kuan Yew School of Public Policy at the National University of Singapore, is author of “The Great Convergence: Asia, the West and the Logic of One World.”)

To contact the writer of this article: Kishore Mahbubani at kishore.mahbubani@mahbubani.net.

To contact the editor responsible for this article: Nisid Hajari at nhajari@bloomberg.net.

 

100 Years Of Success? – Fed ‘Inflation’ Style | Zero Hedge

100 Years Of Success? – Fed ‘Inflation’ Style | Zero Hedge.

Money is only as useful as to what it can purchase. The Fed has created a system where debt is now equal to money.  This is why big purchases like cars, housing, and even going to college are only feasible by mortgaging your future for many decades. Since the payments are broken down into tiny monthly installments many people pay little attention to the true cost of things over their lifetime. Yet, as MyBudget360 shows, over time, the U.S. dollar has lost a tremendous amount of purchasing power due to inflation. Inflation slowly eats away at your purchasing power yet having access to debt has given the middle class the false impression that they are still protected from the unraveling impacts of inflation. They are not…

As MyBudget360.com goes on to note,

Someone sent over a photo posted over on the popular Reddit website that shows the cost of living for people back in 1938.  You would think that people in 2013 would have more purchasing power than those living through the Great Depression.  Adjusting for inflation you would be surprised what has happened in the last 75 years.

 

The cost of living between 1938 and 2013

The picture in question has prices for living from 1938.  It includes important items like a new home, income, new car, rent, and extreme purchasing examples like tuition for Harvard:

cost of living

Source:  Reddit

You can normalize costs over time through adjusting for inflation.  Back in 1938 a new home cost about two times the annual average income.  A new car was only about one-third the cost of the annual average income. These figures are important because back in 1938, using credit was only a small factor in purchasing goods.  Themiddle class didn’t start blossoming until after World War II so you would expect that things were still tough for regular households.  What we find though is that compared to the typical income, buying a new home or buying a car was relatively doable for most households.

Now adjusting all these figures for inflation shows how much more expensive things have become and how dependent we now are to financing purchases with debt (created by the banking system):

inflation and actual prices

 

This chart shows the impact of inflation and the declining purchasing power of the US dollar.

For example, a new home adjusting for inflation (using the BLS calculator) should cost around $64,597 per year.  The current cost of a new home?  $245,800.  The average income has stayed about the same normalizing for inflation (doesn’t say much since we are going back to the Great Depression here).  A new home today costs nearly 10 times the annual average income of a worker.  The two income trap has largely hidden this inflation since it now takes two households to accomplish what one income was able to do 75 years ago.  On top of that, people now need to go into massive debt just to purchase a home. 

 

Take a look at the cost of a new car as well. In 1938 a worker was able to purchase a new car with one-third of their annual income.  Today a new car is more expensive than the annual average income.  This is why in 2013 one of the top growing consumer debt sectors was with automobile loans.

 

If things stayed the same, the cost of attending Harvard for one year in 2013 would be closer to $7,000 per year (the current tuition is $54,496 per year).  It isn’t only Harvard charging incredibly high tuition around the country.  Of course the higher education bubble is one of the most pressing issues around creating a$1.2 trillion student debt market.

 

Rent, movie tickets, and even gasoline are much more expensive today adjusting for inflation.  This puts a heavier strain on the pocketbook of most Americans.  It also has created a dependency on debt.

 

We do have stronger safety nets so we don’t have the “in your face” poverty of the Great Depression.  Yet we still have close to 48 million Americans on food stamps.  The area that has seen prices become more affordable is with food.  This however is largely derived from better access to food and products and the mass production of this commodity.  Yet the bigger costs of living in housing, cars, rent, and going to college are all much more expensive today.  It may feel cheaper to some if they only look at their monthly debt payment but the true costs have increased.

As Jim Quinn (of The Burning Platform blog) so eloquently sums up,

Who benefits?

 

Bankers!!!!

 

Debt peddlers win when income doesn’t keep up with costs and media propagandists convince the masses they must have what they can’t afford.

 

Has the Federal Reserve created inflation benefited you in any way whatsoever? Lucky for Ben, Janet and the rest of the Wall Street cabal the average American can’t make change from a one dollar bill, let alone grasp the concept of inflation. The government education system has done its job, just as our owners desired.

 

Remember – inflation is well contained. Ben is still worried that it is too low.

Know your enemy.

 

 

» New armored tank for town police sparks fear, war of words Alex Jones’ Infowars: There’s a war on for your mind!

» New armored tank for town police sparks fear, war of words Alex Jones’ Infowars: There’s a war on for your mind!.

Joe Saunders
bizpacreview.com
December 23, 2013

A war of words has broken out over police force in California getting a new armored vehicle built more for a state of war than patrolling in the Golden State.

The Salinas Police Department recently issued a news release proudly announcing the arrival of the armored truck built to survive minefield explosions, which it got compliments of federal taxpayers as part of a program to convert military equipment to law-enforcement use.

califmwrap1222

Critics took to the police department’s Facebook page to ask exactly why a city of 150,000 on the northern California coast really needs a vehicle designed for battlefield use. It’s more likely to be used against its own citizens, they said..

“That vehicle is made for war. Do not use my safety to justify that vehicle,” one wrote. “The Salinas Police Department is just a bunch of cowards that want to use that vehicle as intimidation and to terrorize the citizens of this city.”

‘To stop gang members?” another wrote. “Hmmm gang members don’t riot in mass numbers. It’s right in front of our faces and we don’t see it. Why would the ARMY!!! give something like that for FREE!!! Let’s think for once people.”

Police Chief Kelly McMillin said he doesn’t understand the problem.

“I knew this was going to come up,” he said in an interview with the Salinas Californian. “It’s the militarization-of-the-police issue. People are like, ‘Why do you need this?’”

He said it’s not what the department has, it’s what it does that’s the point.

“An allegation that we are militarizing has to be that we were patrolling the streets in platoons in greater numbers, that we were setting up checkpoints and searching people in and out of neighborhoods,” he told the interviewer.

The Salinas PD isn’t doing any of that, he said.

Maybe not. And maybe it never will under Kelly McMillin. But that’s not the point, and it’s hard to believe McMillin and the reporter from the Salinas Californian don’t know that.

This country only two months ago saw rangers for the National Park Service – National Park rangers, for God’s sake – turn into a bunch of storm troopers keeping World War II vets out of their own monument, and visitors from “recreating” at Yosemite.

And Chief McMillin doesn’t understand why citizens don’t trust the government with ever-greater weaponry in the hands of a “civilian” police force?

Just ask the commenters on the Salinas Californian article.

“It could be used to deliver a whole bunch of shut the hell up to the citizens of this fair town,” one wrote.

Another agreed.

“And Obama said we don’t need military weapons in hands of citizens”

H/T: The Daily Mail

Legion | Collapse of Industrial Civilization

Legion | Collapse of Industrial Civilization.

American Horror Story

You almost have to feel sorry for the conservatives, tea partiers, and the whole menagerie of free market evangelists these days. Even a casual perusal of AM talk radio, along with the buffoonery and gas baggery of the hard right news shows, one can see evidence of collapsing narratives at every turn.

Our disintegrating social conditions demand a plausible explanation from the right, and any such explanation, ideologically, must be sure to exonerate capitalism and the free market system.

This is becoming increasingly hard to do, as the shrill and contradictory defenses put forth become less satisfying every time the story is told. The story evolves, the audience reactions carefully polled, and the messaging refined to try and adapt to a low information audience growing more skeptical by the minute. There are many versions of the same story, depending on who tells it and more importantly who is paying for it, but for this discussion we are interested in the narrative brought forth by the evangelical right, and their socially conservative stable mates, or in general, the fire and brimstone crowd accounting for something near half of the American population.

The operating theory of this cohort centers for the most part on morality, or lack thereof, as principal cause for our society’s collapse.

Rush Limbaugh provides a pathetic but typical example of this type of addled logic:

The reason all of these stats on income inequality don’t work anymore is because the baseline for the statistical start is the fifties.  Now, what was happening in the fifties?  Well, in the fifties we had this thing called a nuclear family.  There was a mother, a woman.  There was a father, a man.  They had babies by engaging in coitus.  Leave It To Beaver, Ozzie and Harriet — hell, even the Beach Boys, for crying out loud!  They were seemingly clean and pure as the wind driven snow.

Anyway, then after the coitus in the bedroom, then little Beaver was born and then Wally, and there were 2.8 of the kids and little picket fence and (if the dad got a vice presidency), there were two cars in the garage, and mom — the female. I’ve gotta make that distinction. The mother was a woman, the wife of a man. She stays home, raises the kid, fixes breakfast, sends ‘em off to school, talks to the PTA. There was all that.  There was one breadwinner, and there was an economic boom going on at the same time, following World War II.

Incomes in America rose dramatically.  Then something happened.  The left didn’t like that arrangement.  That was just bad. They didn’t fit in.  They didn’t like the idea of coitus in the bedroom.  They didn’t like coitus with someone the opposite sex, necessarily.  They didn’t even like coitus as a means of producing a kid.  In fact, most times they didn’t even like the kid. They wanted to have the abortion.  So what happened was that the nuclear family became under assault by “progressive” forces of modernization.

So today, you can’t compare family income today to what it was in the fifties when the boom time ’cause the family’s not the same.  You’ve got single women, single-parent families, fewer nuclear families.  Incomes have been divided.  It doesn’t work.

Who knew?

The root of American ethics and morality stems in part from its heavily Protestant and Calvinistic theological underpinnings, which we might well reduce to the “Puritan” ethic. There are several key components of this behavior, tracing back to the late 17th century:

1. Personal sacrifice fulfilled by austere living conditions.

2. Self-sufficiency and disdain of charity for one’s self.

3. Obsessive work ethic fueled by the notion that idleness is evil.

Of course there are others, but we can use these generalizations to continue. In addition we should mention that Calvinism utilizes the principle of predestination, or predetermination, a fundamental departure from modern evangelical Christianity.

The rollup of these centuries old dogmatic beliefs is a programing bias towards moral explanations for when things go wrong, and strong lifestyle choices that dictate high moral standards when times are normal, in order to stave off any potential (future) fall from grace. The modern evangelical right has conflated this DNA to represent a distorted view of Christianity leaning heavily on Capitalism-which has fascist underpinnings in its ultimate embodiment.

In the Flat Fields

A gut pull drag on me
Into the chasm gaping we
Mirrors multy reflecting this
Between spunk stained sheet
And odorous whim
Calmer eye- flick- shudder- within
Assist me to walk away in sin
Where is the string that Theseus laid
Find me out this labyrinth place

I do get bored, I get bored
In the flat field
I get bored, I do get bored
In the flat field

What is often lost in our current infatuation with Enlightenment thinking is the degree to which the Pre-Enlightenment Church managed commerce, financing, and general market forces. In fact, the Church maintained an iron hand on issues such as usury, which was condemned and not distinguished from the “normal” practice of charging interest until the late 19th century.

In the age of Church hegemony, which lasted for centuries, it was considered immoral, and grossly so, to profit in any way through trade, charging interest, or commerce which resulted in a profit without actually performing any work. specifically, any rent seeking activity was forbidden.

Things that are considered commonplace today, such as raising prices for items needed in a disaster, (supply and demand) were thoroughly rejected by the Church and considered inconceivable during that time. Thomas Aquinas brought forth these concepts in the theory of Just Price in his Summa Theologica circa 1274 AD. Although this was clearly a Pre-Capitalist economy, much learning was put towards strict management of commerce dating back to the money changers being expelled from the temple in Biblical times- a theme oft repeated through the Dark Ages and well beyond.

For centuries, civilizations knew full well the dangers of markets and unconstrained commerce, and there is more than a passing connection between this realization and theology, present in virtually all religions throughout time.

This reality has been brought to the fore with the recent, and controversial, exhortation Evengelii Gaudium from the Roman Catholic Pope. Pundits have been zeroing in on the more provocative aspects after his release of the document last month. I’ve read all 244 pages of it and I’m here to tell you that he has pretty well burned down the Christian right’s moralistic narrative along with a good bit of the more mainstream conservative cohort.

For those who have dismissed previous Papal exhortations (as well as any other messaging, written or otherwise delivered) as irrelevant and hypocritical drivel, and I count myself on this list, the recent missive is a shocker. Let’s take a look as some selected passages:

We can no longer trust in the unseen forces and the invisible hand of the market. Growth in justice requires more than economic growth, while presupposing such growth: it requires decisions, programmers, mechanisms and processes specifically geared to a better distribution of income, the creation of sources of employment and an integral promotion of the poor which goes beyond a simple welfare mentality. I am far from proposing an irresponsible populism, but the economy can no longer turn to remedies that are a new poison, such as attempting to increase profits by reducing the work force and thereby adding to the ranks of the excluded.

The need to resolve the structural causes of poverty cannot be delayed, not only for the pragmatic reason of its urgency for the good order of society, but because society needs to be cured of a sickness which is weakening and frustrating it, and which can only lead to new crises. Welfare projects, which meet certain urgent needs, should be considered merely temporary responses. As long as the problems of the poor are not radically resolved by rejecting the absolute autonomy of markets and financial speculation and by attacking the structural causes of inequality,[173]no solution will be found for the world’s problems or, for that matter, to any problems. Inequality is the root of social ills.

Now this passage in particular stands out, and is a recurring theme throughout the document. Inequality is the root of all social ills. Not moral misbehavior. Rush Limbaugh is positively foaming at the mouth with this conclusion. You see, the story as told has to exonerate Capitalism, so the explanatory focus is redirected to not just suggest, but to demand that the moral lapses of the populace are the sole causality of a world gone bad.

After all, the world was given to us with abundance, work hard, maintain high moral standards, and its abundance will never run out. No limits to resources, no environmental disasters, no exploitation, nothing but paradise, unless of course you take a bite of that apple.

Spear Of Destiny - Religion - Front

Let’s go on:

Sometimes we prove hard of heart and mind; we are forgetful, distracted and carried away by the limitless possibilities for consumption and distraction offered by contemporary society. This leads to a kind of alienation at every level, for “a society becomes alienated when its forms of social organization, production and consumption make it more difficult to offer the gift of self and to establish solidarity between people.

Karl is that you?

Genuine forms of popular religiosity are incarnate, since they are born of the incarnation of Christian faith in popular culture. For this reason they entail a personal relationship, not with vague spiritual energies or powers, but with God, with Christ, with Mary, with the saints. These devotions are fleshy, they have a face. They are capable of fostering relationships and not just enabling escapism. In other parts of our society, we see the growing attraction to various forms of a “spirituality of well-being” divorced from any community life, or to a “theology of prosperity” detached from responsibility for our brothers and sisters, or to depersonalized experiences which are nothing more than a form of self-centredness.

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This would seem to be a dig at modern “strip mall religiosity” as it is now de rigueur to have non denominational churches in strip malls, repurposed industrial buildings, etc, all which have superficial distorted messaging, often pronouncing how wealth is your divine right.

Today’s economic mechanisms promote inordinate consumption, yet it is evident that unbridled consumerism combined with inequality proves doubly damaging to the social fabric. Inequality eventually engenders a violence which recourse to arms cannot and never will be able to resolve. It serves only to offer false hopes to those clamouring for heightened security, even though nowadays we know that weapons and violence, rather than providing solutions, create new and more serious conflicts. Some simply content themselves with blaming the poor and the poorer countries themselves for their troubles; indulging in unwarranted generalizations, they claim that the solution is an “education” that would tranquilize them, making them tame and harmless. All this becomes even more exasperating for the marginalized in the light of the widespread and deeply rooted corruption found in many countries – in their governments, businesses and institutions – whatever the political ideology of their leaders.

Today in many places we hear a call for greater security. But until exclusion and inequality in society and between peoples are reversed, it will be impossible to eliminate violence. The poor and the poorer peoples are accused of violence, yet without equal opportunities the different forms of aggression and conflict will find a fertile terrain for growth and eventually explode. When a society – whether local, national or global – is willing to leave a part of itself on the fringes, no political programmes or resources spent on law enforcement or surveillance systems can indefinitely guarantee tranquility. This is not the case simply because inequality provokes a violent reaction from those excluded from the system, but because the socioeconomic system is unjust at its root. Just as goodness tends to spread, the toleration of evil, which is injustice, tends to expand its baneful influence and quietly to undermine any political and social system, no matter how solid it may appear. If every action has its consequences, an evil embedded in the structures of a society has a constant potential for disintegration and death. It is evil crystallized in unjust social structures, which cannot be the basis of hope for a better future. We are far from the so-called “end of history”, since the conditions for a sustainable and peaceful development have not yet been adequately articulated and realized.

So now we get to the money shot:

While the earnings of a minority are growing exponentially, so too is the gap separating the majority from the prosperity enjoyed by those happy few. This imbalance is the result of ideologies which defend the absolute autonomy of the marketplace and financial speculation. Consequently, they reject the right of states, charged with vigilance for the common good, to exercise any form of control. A new tyranny is thus born, invisible and often virtual, which unilaterally and relentlessly imposes its own laws and rules. Debt and the accumulation of interest also make it difficult for countries to realize the potential of their own economies and keep citizens from enjoying their real purchasing power. To all this we can add widespread corruption and self-serving tax evasion, which have taken on worldwide dimensions. The thirst for power and possessions knows no limits. In this system, which tends to devour everything which stands in the way of increased profits, whatever is fragile, like the environment, is defenseless before the interests of a deified market, which become the only rule.

And

One cause of this situation is found in our relationship with money, since we calmly accept its dominion over ourselves and our societies. The current financial crisis can make us overlook the fact that it originated in a profound human crisis: the denial of the primacy of the human person! We have created new idols. The worship of the ancient golden calf (cf. Ex 32:1-35) has returned in a new and ruthless guise in the idolatry of money and the dictatorship of an impersonal economy lacking a truly human purpose. The worldwide crisis affecting finance and the economy lays bare their imbalances and, above all, their lack of real concern for human beings; man is reduced to one of his needs alone: consumption.

In this context, some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by the facts, expresses a crude and naïve trust in the goodness of those wielding economic power and in the socialized workings of the prevailing economic system. Meanwhile, the excluded are still waiting. To sustain a lifestyle which excludes others, or to sustain enthusiasm for that selfish ideal, a globalization of indifference has developed. Almost without being aware of it, we end up being incapable of feeling compassion at the outcry of the poor, weeping for other people’s pain, and feeling a need to help them, as though all this were someone else’s responsibility and not our own. The culture of prosperity deadens us; we are thrilled if the market offers us something new to purchase. In the meantime all those lives stunted for lack of opportunity seem a mere spectacle; they fail to move us.

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Just as the commandment “Thou shalt not kill” sets a clear limit in order to safeguard the value of human life, today we also have to say “thou shalt not” to an economy of exclusion and inequality. Such an economy kills. How can it be that it is not a news item when an elderly homeless person dies of exposure, but it is news when the stock market loses two points? This is a case of exclusion. Can we continue to stand by when food is thrown away while people are starving? This is a case of inequality. Today everything comes under the laws of competition and the survival of the fittest, where the powerful feed upon the powerless. As a consequence, masses of people find themselves excluded and marginalized: without work, without possibilities, without any means of escape.

Human beings are themselves considered consumer goods to be used and then discarded. We have created a “throw away” culture which is now spreading. It is no longer simply about exploitation and oppression, but something new. Exclusion ultimately has to do with what it means to be a part of the society in which we live; those excluded are no longer society’s underside or its fringes or its disenfranchised – they are no longer even a part of it. The excluded are not the “exploited” but the outcast, the “leftovers.

So this goes on in a similar vein, and this position does not bode well for the conservative narrative. We see capitalism explicitly blamed for inequality, and in turn inequality for societies ills, a disturbing cause and effect that is disruptive to the American status quo. Coming from a supposedly impartial and world recognized voice of moralistic guidance, this is particularly damning.

We have to ask given the (millennial) history of precisely just this set of teachings, where the hell have these people been for the last 400 years? Mired in child molestation cases, and other aspects of immeasurable hypocrisy, that’s where. Typically dispensing irrelevant teachings to a disinterested world, met with a yawn and the clink of coins in the Sunday collections basket, the cafeteria Catholics and faithful parishioners buy their penance on the free market of theology, shopping for workable edicts and morals they can live with, and leaving aside things that might prove troublesome.

And the Church, let’s not (yet) get all misty eyed that the new Pope has found his voice, that the Holy See can finally see after 400 years of Post Enlightenment blindness, because if we learned anything in the Dark Ages we learned the Church was an authoritarian, totalitarian institution, honed to perfection after centuries of practice, misappropriating Christianic themes in furtherance of its own power and hegemony. Restricting knowledge, capturing books, and distorting, twisting and interpreting discovery with a certain malleability of facts, and containing science to maintain its omnipotence.

It is worth noting that at its core, the Church operates as a corporatist entity, with significant focus on profits itself, poisoned if you will, by the very same sickness it chastises. So we might well leave the discussion here, hopeful that the new Papal vision will at least upset some belief systems, and file this under the category of good ideas for the wrong reasons, and move on to other superficial topics. Except that we have 2000 years of history here, history that resonates with this same message, repeated in many ways over and over again. We have a seminal event in the Enlightenment, which purported to shut down the fiefdoms, mysticism and fanciful explanations, replacing it with science and reason to wrest the power and authority from cloistered theocrats.

And this has failed.

None of the Post Enlightenment theories of political economy have provided satisfactory, sustainable solutions despite 400 years of trying. By most measures, they are in fact worse. The current fashionable trend to double down on technology as means of providing solutions is not working, and critical thinkers can see these measures are leading to cascading failure modes, with each technological “breakthrough” creating new and unanticipated failures of their own, with insufficient study as to unanticipated outcomes.

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I had occasion last month to attend a talk by Chris Hedges, the first time I have heard him in person. The venue was in Santa Monica in a historic building now owned by the Women’s Club, a depression era wood structure with a whitewashed paint job, faintly reminiscent of a church. The venue was packed to the rafters, with the upstairs balcony fairly bulging under the weight of way more people wanting to see Hedges than the organizers anticipated. Everyone finally got in to the standing room only crowd. Hedges has found his voice, he is articulate in person, but powerful, vocally projecting in a way I’ve not seen him do in taped interviews where he seems more reflective and almost mournful. His message is a powerful force and it is clear his upbringing under a Presbyterian minister (his father) and his education in seminary converge to forge his style and messaging. The emotion and power left me somewhat stunned, I wasn’t prepared for the electricity in the room and palpable agitation of the attendees who know full well the truth in his message.

It might seem that these events conspire to ordain a germ of an idea, a small, kindled spark that suggests, almost horrifically, that the assemblage of the capitalist mode of production is not a just theory of economics or political economy. It is not merely an exchange of commodities or a clever and oblique system of exploitation. It is not just a mechanism for conflicting class structure or means for the landed nobility to hold down the masses.

It is a religion, a theology so all consuming that it transcends borders, boundaries, catechism and Koran. It extends to every denomination, to every corner of the earth with a deification and worship of commerce and consumption so deeply ingrained that there is no inoculation once infected. Its participants trapped in a purgatory analogous to opium dens, transient pleasure of consumption and accumulation, but in the 19th century opium dens most knew to advise a friend to retrieve them after several hours (or days) as they would be unable- and unwilling- to leave on their own.

In this version, no one is coming to get you out, there is no getting out. No one is free from the addictive vapors of consumption.

CAPITALISM AS RELIGION

a) First of all because, as we have seen, capitalism, by defining itself as the natural and necessary form of the modern economy, does not admit any different future, any way out, any alternative. Its force is, writes Weber, ‘irresistible’, and it presents itself as an inevitable fate.

b) The system reduces the vast majority of humanity to ‘damned of the earth’ who cannot hope for divine salvation, since their economic failure is the sign that they are excluded from God’s grace. Guilty for their own fate, they have no hope of redemption. The God of the capitalist religion, money, has no pity for those who have no money . . .

c) Capitalism is ‘the ruin of being’, it replaces being with having, human qualities with commodified quantities, human relations with monetary ones, moral or cultural values with the only value that counts, money.

d) Since humanity’s ‘guilt’ – its indebtedness towards Capital – is permanent and growing, no hope of expiation is permitted. The capitalist constantly needs to grow and expand his capital if he does not wish to be crushed by his competitors, and the poor must borrow more and more money to pay their debts.

e) According to the religion of Capital, the only salvation consists in the intensification of the system, in capitalist expansion, in the accumulation of more and more commodities; but this ‘remedy’ results only in the aggravation of despair.

So in other words, the will of God is substituted by the will of the market. The Saints of Capitalism are not represented by iconography in dusty church alcoves, rendered in plaster bas relief, illuminated by flickering votive candles aligned in perfectly concentric rows, no, these saints are reproduced on our paper money, mass produced by photoengraved plates and scaled to feel, to touch, with every transaction to reacquaint and remind the heathen that this is the portal to eternal salvation.

Our cathedrals are not limestone structures of centuries production, flying buttresses soaring gracefully to the heavens, constructed of a scale to intimidate and instill perspective of scale between creator and subject, no these cathedrals are chrome and glass, with banal and endless rows of cubicles for the disciples to prosthelytize to the unwashed masses, “lift yourself, take our hand and elevate yourself to the glory of all the money is and can be”.

Consume or be consumed, the entire New Testament may be reinterpreted not as a warning of end times, not as a statement of worldly evangelism, but each parable and writing a searing indictment and prophetic warning of a planet destroying insidious religion about to rise. The Original Sin may well be reduced to being born into a world which requires you to sell your labor power for survival, the baptism a cleansing in preparation of a lifelong participation in commodity exchange- labor for goods.

There is no expiation in the religion of Capitalism, it is game theory analogous toNewcomb’s Paradox, a contrivance where an omniscient being gives you two choices, one of which is already made for you, and analyzes your strategy for utility maximization when you know that your choice is already predetermined- and you cannot change the outcome.

Here’s hoping for the ninth Crusade.

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  1. Reblogged this on Food sovereignty reflections and commented:
    The new Pope’s scathing critique of unbridled consumerism and the immorality of the unconstrained market has come as a surprise. His identification of inequality as the root of all social evils reminds me of the compelling data compiled in the Spirit Level, how sharp inequality correlates very closely with high levels of crime, ill-health, low educational attainment, and so forth.

 

Yet another massive nail in the dollar’s coffin

Yet another massive nail in the dollar’s coffin.

On the other side of the world today, a couple of gentlemen that few people have ever heard of signed an agreement that has massive consequences for the global financial system.

It was a Memorandum of Understanding signed by representatives of the Singapore Exchange and Hong Kong Exchange. Their aim– to combine their forces in rolling out more financial products denominated in Chinese renminbi.

This is huge.

Hong Kong and Singapore are THE two dominant financial centers in Asia. For years they’ve been locked in competition with one another, much like New York and London. So their public partnership is a very big deal… indicative of the clear objective they have in front of them.

Bottom line– finance executives in Asia see the writing on the wall. They can see that the dollar is in a period of terminal decline, and it’s clear that the Chinese renminbi is going to take tremendous market share away from the dollar. They want a big piece of the action.

The renminbi has already surpassed the euro to become the #2 most-used currency in the world when it comes to trade settlement, according to a report released yesterday by the Society of Worldwide Interbank Financial Telecommunication (SWIFT).

Right now the renminbi has about an 8.6% share of the global market for trade settlement. Granted, the dollar has the lion’s share of trade settlement at more than 80%.

But just look at how quickly the renminbi has grown; in January 2012, its share of the global market was just 1.9%. So it’s grown by nearly a factor of 5x in less than two years.

With today’s agreement between Hong Kong’s and Singapore’s financial exchanges, that growth will likely accelerate.

As we’ve discussed before, the dollar is in a unique position simply because it is the world’s dominant reserve currency.

This means that when a rice distributor in Vietnam does business with a Brazilian merchant, they’ll close the deal by trading US dollars with each other… even though neither nation actually uses the dollar.

It’s been this way since World War II, simply because there has been such a long tradition of trust in the United States, and a steady supply of dollars throughout the world.

But this confidence is fading rapidly as merchants and banks around the world have been seeking alternatives, primarily the Chinese renminbi.

As the dollar’s market share in international trade decreases, it will mean the end of US financial privilege. No longer will the US be able to print money without repercussions.

And as so many other nations have learned the hard way, when you print money with wanton abandon and indebt your nation to the hilt, there are severe consequences to pay.

Today’s move between Hong Kong and Singapore gives us a glimpse into this future.

We’ll soon see more financial products– oil, gold, Fortune 500 corporate bonds, etc. denominated in renminbi and traded in Asia.

And as trade in these renminbi products grows, the dollar will be closer and closer to its reckoning day.

Years from now when this has played out, it’s going to seem so obvious.

Just like the post-Lehman crash in 2008, people will scratch their heads and wonder– ‘why didn’t I see that coming? Why didn’t I recognize that it was a bad idea to loan millions of dollars to unemployed / dead people?’

Duh. Same thing. People will look back in the future and wonder why they didn’t see the dollar collapse coming… why they didn’t recognize that it was a bad idea for the greatest debtor nation in the history of the world to simultaneously control the global reserve currency…

The warning signs are all in front of us. And today’s agreement between Hong Kong and Singapore is one of the strongest signs yet.

 

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