Amy Goodman and Chris Hedges discuss #Occupy with Charlie Rose

Charlie Rose recently discussed the #Occupy movement with Amy Goodman of Democracy Now and writer Chris Hedges of Truthdig.com. This was a thought-provoking show in which all of the participants take the #Occupy movement seriously. What follows are some of my notes regarding the interview. Amy Goodman indicates that we are in the midst of a revolution. Chris Hedges describes this revolt as one that strives to regain democracy and is opposed to the current system of "inverted totalitarianism." It's not "classical totalitarianism. It doesn't find its expression through a demagogue or a charismatic leader, but through the anonymity of the corporate state. . . . [In a system of inverted totalitarianism, "corporate forces purport to pay a fealty to electoral politics, the Constitution, the iconography and language of American patriotism, and yet have so corrupted the levers of power as to render the citizens impotent. We see that in one piece of legislation after another. . . . The formal structures of power are tone deaf. . . [Under the corporate state] there is no way to appeal to the system. It doesn't matter what the citizens want." Amy Goodman points out that while most Americans support the #occupy protests, the protesters are portrayed by many as merely engaging in class warfare. At 14:50, Goodman points out that the #Occupy protesters and the Tea Party have many overlapping concerns. At 21:00 Hedges indicates that there are stark differences with the Tea Party which, he claims, has deep elements he would describe as fascist. Another difference is that the Tea Party targets government because "the corporations want government to become more anemic; it speaks in the language of violence and the gun culture" and they direct their rage toward "vulnerable people such as Muslims, undocumented workers, homosexuals and intellectuals, all sort of the classic rubric that one finds in a fascist movement." Goodman also discusses the importance of citizen journalism. "When police tell people to turn off their video camera, that's exactly when they need to turn their video cameras on. . . . We need media in this country that allows people to speak for themselves. Ultimately, the media can be the biggest force for peace on earth." Goodman believes that this movement will be sustained through the winter and beyond, and that "the organized parties, the Democrat and Republican parties are running scared."

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Matt Taibbi offers five concrete solutions to the misconduct of Wall Street

How should the #occupy movements address the problems of Wall Street? Matt Taibbi offers this advice:

1. Break up the monopolies. The so-called "Too Big to Fail" financial companies – now sometimes called by the more accurate term "Systemically Dangerous Institutions" – are a direct threat to national security. . . . 2. Pay for your own bailouts. A tax of 0.1 percent on all trades of stocks and bonds and a 0.01 percent tax on all trades of derivatives would generate enough revenue to pay us back for the bailouts, and still have plenty left over to fight the deficits the banks claim to be so worried about. . . . 3. No public money for private lobbying. A company that receives a public bailout should not be allowed to use the taxpayer's own money to lobby against him. . . . 4. Tax hedge-fund gamblers. For starters, we need an immediate repeal of the preposterous and indefensible carried-interest tax break, which allows hedge-fund titans like Stevie Cohen and John Paulson to pay taxes of only 15 percent on their billions in gambling income, while ordinary Americans pay twice that for teaching kids and putting out fires. I defy any politician to stand up and defend that loophole during an election year. 5. Change the way bankers get paid. We need new laws preventing Wall Street executives from getting bonuses upfront for deals that might blow up in all of our faces later. . . .

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The science of income disparity

In this TED video, researcher Richard Wilkinson discusses real work data based levels of income disparity one finds in "rich developed-market democracies." As you can see (at 4:11 of the video), nations with low amounts of GNP don't tend to exhibit aberrant levels of health and social problems. On the other hand, countries that exhibit substantial amount of income disparity (3:44) exhibit high levels of health and social problems. GNP per capita is thus a poor measure of a country's well-being.  Further, we should be alarmed at high levels of income disparity. The same relationship (5:01) is apparent when one compares GNP to the UNICEF scale of child well-being. "The national well-being of our societies is not dependent any longer on national income and economic growth." The same tests were run on the 50 states of the U.S. with the same results. What else suffers along with high income disparity? Trust (5:45), involvement in community life (6:00), mental illness (6:50), violence, percentage of the population in prison (7:40), the percentage of dropouts in high school (8:16), social mobility (poor parents having children who end up poor) (8:24), drug abuse, life expectancy, obesity, math and literacy scores and many other problems (9:10). Wilkinson sums it up by saying that the countries that do worse---those that have higher social dysfunction--tend to be more economically unequal. How do the various low income disparity nations and states attain their earning levels? Sweden does it by heavily taxing the rich. Japan has more comparable wages to begin with. Wilkinson's numbers show, however, that it doesn't much matter how you get your equality as long as you get there somehow. He adds that it's not only the poor that are affected by income disparity (12:20). Additional statistics show that the wealthy significantly benefit from general equality, not just the poor. What is the proximate mechanism for all of these startling numbers. Wilkinson points to the following consequences of inequality:

  • More superiority and inferiority;
  • More status competition and consumerism;
  • More status insecurity;
  • More worry about how we are seen and judged;
  • More "social evaluation anxiety" (threats to self-esteem & social status, fear of negative judgments).
Wilkinson offers an unsurprising solution to countries and states with high levels of social dysfunction: Even out the income, either by offering more opportunities to folks at the lower end of the scale or by taxing the high earners (16:17). The bottom line is that we can improve a country's overall well-being by reducing economic inequality. I am not at all surprised by Wilkinson's findings. It combines many ideas that I've previously discussed. No, GNP (and GDP) is a terrible measure of well-being (and see here) and people are deeply compelled to display their self-worth through material acquisitions. And all of this would seem to be exacerbated to the extent that TV and magazines pump images of the haves (and their expensive toys) into the homes and lives of the have-nots, causing all kinds of frustrations and degradations of self-worth among the have-nots. That was my suspicion prior to viewing Wilkinson's video and now all of this and many other measures of social dysfunction are backed up by Wilkinson's real-life numbers.

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What is the financial sector up to?

If the financial sector does not mostly consist of real banks, taking deposits and lending money to businesses, what do they do? Christopher Ketcham explains, in an article titled "The Reign of the One Percenters," in Orion Magazine:

At one time, the financial sector could be relied upon to allocate capital for the building of things that society needed—projects that also invariably created jobs. But productivity is no longer its purview. Lord Adair Turner, a financial watchdog and former banker in the city of London—the other world capital of finance—recently denounced his class as practitioners and beneficiaries of a “socially useless activity.” Paul Woolley, who runs a think tank in London called the Centre for the Study of Capital Market Dysfunctionality, observed that the “presumption that financial innovation is socially valuable” was a kind of metaphysics. “It wasn’t backed by any empirical evidence,” Woolley told John Cassidy, a staff writer for The New Yorker. Structured investment vehicles, credit default swaps, futures exchanges, hedge funds, complex securitization and derivative pools, the tranching of mortgages—these were shown to have “little or no long-term value,” according to Cassidy. The purpose was to “merely shift money around” without designing, building, or selling “a single tangible thing.” The One Percenter seeks only exchange value, as opposed to real value. Thus foreign exchange currency gambling has skyrocketed to seventy-three times the actual goods and services of the planet, up from eleven times in 1980. Thus the “value” of oil futures has risen from 20 percent of actual physical production in 1980 to 1,000 percent today. Thus interest rate derivatives have gone from nil in 1980 to $390 trillion in 2009. The trading schemes float disembodied above the real economy, related to it only because without the real economy there would be nothing to exploit.

.   .   .

Finance as practiced on Wall Street, says Paul Woolley, is “like a cancer.” There is only maximization of short-term profit in these “financial services”—they are services only in the sense of the vampire at a vein. There is no vision for allocating capital for the building of infrastructure that will serve society in the future; no vision, say, for a post-carbon civilization; no vision for surviving the shocks of coming resource scarcity. The finance nihilist doesn’t look to a viable future; he is interested only in the immediate return.

When reading the above numbers, keep in mind that the annual tax receipts of the United States only amount to about $2 trillion.

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