Archive for the ‘Financial melt-down’ Category

New Category added to Samadhisoft

Friday, December 7th, 2012

I’ve added a new category under which I can classify posts here in Samadhisoft.  It is:

Corporate takeover of government

I’ve been realizing for sometime that in their efforts to maximize profits for their shareholders, corporations have been working to control our governments in order to diminish the power those governments to make the laws that limit their actions and opportunities.

This is a major factor in the way human history is progressing now in the early 21st century.

We, as a species, should be deep into the realizations now that if we do not change directions, we are going to experience a calamity of truly historic proportions.  I call this the Perfect Storm.  A calamity so huge, in fact, that it will make all the other major ‘events’ of human history pale.

So, what makes us press on so heedlessly when the danger signs are growing so prolifically around us?

Some of it is our human nature.

But another very significant part is the fact that corporations have gotten so powerful that they are directly or indirectly controlling our governments for their own aims.  And, as those aims are solely about maximizing profits for their shareholders, those aims do not include considerations about the future of our species or the health of the planet.   In many cases (as you will see in the links, below), corporations are working actively to defeat the very things we should be doing for own own survival. And they do this because if we are allowed to do these things, it would interfere with their profits.

To get an idea of the size and tenacity of the problem, consider that of the 100 most powerful economies on the planet, 51 of them are corporations.

In honor of the new category  and to review for you some of the stories and perceptions that have led me to this POV, I’ve listed below a number of stories and pieces I’ve written or reported on here that bear on this subject:

 

 – The Corporate “Heist” of the United States Government Began With a Memo in 1971

– Forbidden Planet – George Monbiot

– Tobacco and the manipulation of public perception for corporate profit

 – The new face of how corporations dominate governments

– The Greedy are everywhere…

– Myth of Perpetual Growth is killing America

– Top (American) CEO pay equals 3,489 years for typical worker

– Why increasing corporate control of our world is bad

– Obama tries again to end oil subsidies

– Corporate Margins and Profits are Increasing, But Workers’ Wages Aren’t

– Plutocracy, Pure and Simple – George Monbiot

– Syngenta PR’s Weed-Killer Spin Machine: Investigating the Press and Shaping the “News” about Atrazine

– Ohio Lawmakers Introduced 33 Bills Last Year Based on ALEC Model Legislation

– Directors’ pay rose 50% in past year, says IDS report
– Financial world dominated by a few deep pockets
– As Verizon Demands Huge Cuts to Worker Benefits, Its Profits Soar and Its CEO Gets $18 Million in Compensation
– America in Decline – Noam Chomsky
 – Health Insurers Making Record Profits as Many Postpone Care
 – Lobbying Firm Advising Corporate Clients How to Take Advantage of Campaign Finance Ruling
 – We’re having the wrong conversations

– The Supreme Court and Corporations

– Corporations Are Citizens – What Are We?

The U.S. Economic situation – some eye popping numbers…

Sunday, October 28th, 2012

Click here: for the U. S. Debt Clock numbers.

– Research thanks to Alex C.

Software Patents and the End of Innovation

Tuesday, October 9th, 2012

From Nancy Heinen, Apple general counsel until 2006:

When patent lawyers become rock stars, it’s a bad sign for where an industry is heading.

Yes it is. And from the same article:

Last year, for the first time, spending by Apple and Google on patent lawsuits and unusually big-dollar patent purchases exceeded spending on research and development of new products, according to public filings.

The whole piece is worth a read.

 

-Thx to Mother Jones.

U.S. Pharmacy Prices

Wednesday, August 15th, 2012

I had a Prostatectomy in August of 2009.   One of the consequences of that operation is a tendency towards impotence since the nerves that control erections are seriously disturbed by the process of removing the Prostate Gland.  

If you are marginally impotent, as I was, following the surgery, Erectile Disfunction drugs like Cialis are indicated.   And they are, in fact a great help.

But the prices of Cialis is astronomical.   

I’ve tried ordering the cheaper generic stuff from India but, in truth, I have no confidence in it nor to I think it works.

So, that left me with ordering it in New Zealand or in the U.S.   New Zealand doesn’t subsidize Cialis as part of their medical system so they are simply charging U.S. prices with a shipment markup added.

In the USA, for 45 – 20mg pills, the cost is $1100+ USD.   Ouch!   I paid that last year when I was here and this time, I thought I’d have to do the same.

But, I had a trip up to Canada scheduled to visit a good friend of mine and, in the course of things, I found myself with most of a day to kill here while my friend was at work one day.

I decided to see if I could do better price-wise on Cialis here.

The bottom line is, “yes”, I could do better.   I paid only 60% of the US price here and got the ‘real deal’ Cialis from the genuine U.S. pharmaceutical firm that makes it.

If you need this stuff and live anywhere near the Canadian border, this is worth knowing about.

Get a U.S. prescription (original copy) and bring it to a Canadian walk-in clinic.   Pay the $60 CDN (your price may vary) to see a doctor and ask him to rewrite the prescription as a Canadian prescription.   Then carry that to a Canadian pharmacy and you’ve saved yourself 40% off the U.S. prices.

Why are U.S. prices so high?  Such an obvious question and none of our elected representatives (elected to supposedly represent our interests) can tell you.  Maybe it is all those Big Pharma donations that helped get them elected?

Dennis

The greedy are everywhere…

Wednesday, July 4th, 2012

– In the U.S., in Europe, and even here in my beloved New Zealand.

– They put on suits, they carry a briefcase, they do ‘deals’ and it all looks brilliant and magical.

– But, sometimes, someone goes behind the scenes and traces some of this ‘business’ and finds that a lot of it is ‘funny business’.

– What would you think of an investment company that did big deals for the purpose of making profits for their investors and, when the dust had settled, the deals were done and all the contracts and the fine print were all read out and traced – you found out that the bankers and the company’s principals made far more profit from all of the money shuffling than any of their poor investors did?

– I think it stinks.   And yet I also think that many business types live and thrive in just this way and consider themselves brilliant,.  And that they consider the rest of us as just their sheep in need of a shearing and too dumb to know we’re being hard done by.

– This bit of fun happened here in New Zealand though the business itself reached around the globe to London as well.  

– No matter.  In fact, all the better.   The more abstract, the further afield, the less normal people can relate to the doings, the better.   Big money moving in the shadows.

– Here in New Zealand, the National Government, under John Key, a former Wall Street type, wants to sell public assets to raise money.   After reading this expose on the investment company, EPIC, I’ll be most curious to  ‘follow the money’ when the Key government does begin to sell those assets.  

– Who will be doing the deals and who will be making enormous profits from the fees along they way?  Why do I suspect that they will be business types like Key?  Types who are telling themsleves all along the way that the fact that they are getting rich is only incidental to the good they are doing for the country.

– Yeah, right.

– Dennis

– – – – – – – – – – – – – – –

The rather curious case of Epic’s fee payments

(this from stuff.co.nz an opinion piece by Tim Hunter)

OPINION: After years of study, there is growing acceptance that homo sapiens has evolved into two distinct branches. One comprises the vast bulk of humanity, the other comprises individuals known as bankers.

Although superficially alike, the latter can be distinguished by their skin, which is thicker than normal. It also has special properties giving unusual adhesion to most forms of money.

In tests using a drained swimming pool filled with Zimbabwean currency, bankers were found to emerge from the pool with up to 25 per cent more cash sticking to them than the non-banking control group.

Scientists initially hypothesised an epidermal layer of tiny hooks, like Velcro, to explain the effect, but now favour a theory of electro-magnetic attraction at the cellular level.

Edinburgh University’s department of parapsychology is also testing observations that bankers can detect the contents of a wallet within a range of about five metres, even through stud walls.

These attributes are an advantage in financial transactions, and Chalkie reckons there could be something like this going on in an investment structure called Equity Partners Infrastructure Company (Epic). Basically, Chalkie’s study of accounts and documents with small print suggests Epic has paid out millions more in fees to bankers and their ilk than it has to its investors.

– Definitely, you should read more here…

Crisis forces dismal science to get real

Wednesday, July 4th, 2012

– Just a few days ago, I wrote about an article that appeared in the Wall Street Journal’s Market Watch section.   This article, acknowledged what I think is a deep and unavoidable truth about the world.  And that is that all our economies are based on models that insist on indefinite growth for the model to succeed.

– And, I said, any eight year-old knows that you cannot go on creating more and more stuff on a stage of finte size.  Common sense tells you the stagewill fill up and you will come to the end-game.

– So here we have an article about an ongoing deep angst in the world of economists about how their models are failing to predict the ups and downs of the world’s economy.   Hand wringing and questions about the deep assumptions being taught at the various schools of economics abound.

– And not one WORD about the most fundamental issue of all.   That ALL their models depend on indefinite growth to succeed and that this is just impossible.   Give me strength!

– Dennis

= = = = = = = = = = = = = = =

As economics teachers struggle to make sense of a post-crisis world, they may have an unlikely army of helpers: ants.

In September 2008, the same month that Lehman Brothers collapsed, the Argentinian ants became the unwitting stars of a German television show that set out to illustrate collective efficiency. To the frustration of the show’s producers, the insects ended up showing how easily rational expectations can go awry.

The ants – Linepithema humile – had a choice between a long route and a short one to get to a pile of food. In theory, their chemical communication and millions of years of evolution should have led them to work out the short route.

They chose the long one, and most kept using it even though some had found the shorter path. “The Germans were furious,” said economics professor Alan Kirman, whose neuroscientist friend and colleague Guy Theraulaz ran the experiments in the south of France.

Kirman, professor emeritus at Aix Marseille University and France’s Ecole des Hautes Etudes en Sciences Sociales, has started to use the footage in a talk he gives about modern economic thinking. The insects were far from efficient, he said, but reached their goal in the end.

“I think the economy is a lot like that.”

There lies a hint of the revolution that is building at the heart of academic economics, particularly in Europe.

As the euro zone crisis deepens, economists in France, Germany and Italy have been forced to turn away from classroom theories and look at the real world – from insects to financial markets, from banks to brain scans – to better understand what’s going on.

An increasing number of teachers argue that the textbooks, some by experts who didn’t see the crisis coming, are divorced from reality, inconsistent, dull, and, in a crisis that has gripped the globe for more than four years, even dangerous.

“A crisis is a wonderful opportunity in some sense,” said Kirman. “If it weren’t for the fact that millions of people are suffering as a result, what better time to be an economist, because now you can see what’s going wrong with our theory.”

– More…

 

End of an Era

Tuesday, June 26th, 2012

– Parents, it is time to think about where your children are going to be when the sh** hits the fan.  I don’t think we’re going to avoid this mess but you could shift them to a place where another generation or two might have reasonable lives.   If you think that might be in a big city in the U.S., I think you are missing the point.

– Dennis

– – – – – – – – – – – – – – – –

By George Monbiot, published in the Guardian 25th June 2012

It is, perhaps, the greatest failure of collective leadership since the first world war. The Earth’s living systems are collapsing, and the leaders of some of the most powerful nations – the US, the UK, Germany, Russia – could not even be bothered to turn up and discuss it. Those who did attend the Earth summit last week solemnly agreed to keep stoking the destructive fires: sixteen times in their text they pledged to pursue “sustained growth”, the primary cause of the biosphere’s losses(1).

The future

The efforts of governments are concentrated not on defending the living Earth from destruction, but on defending the machine that is destroying it. Whenever consumer capitalism becomes snarled up by its own contradictions, governments scramble to mend the machine, to ensure – though it consumes the conditions that sustain our lives – that it runs faster than ever before.

The thought that it might be the wrong machine, pursuing the wrong task, cannot even be voiced in mainstream politics. The machine greatly enriches the economic elite, while insulating the political elite from the mass movements it might otherwise confront. We have our bread; now we are wandering, in spellbound reverie, among the circuses.

We have used our unprecedented freedoms, secured at such cost by our forebears, not to agitate for justice, for redistribution, for the defence of our common interests, but to pursue the dopamine hits triggered by the purchase of products we do not need. The world’s most inventive minds are deployed not to improve the lot of humankind but to devise ever more effective means of stimulation, to counteract the diminishing satisfactions of consumption. The mutual dependencies of consumer capitalism ensure that we all unwittingly conspire in the trashing of what may be the only living planet. The failure at Rio de Janeiro belongs to us all.

– More…

Myth of Perpetual Growth is killing America

Monday, June 25th, 2012

– This article is from no less than the Wall Street Journal’s Market Watch.  

– Amazing, isn’t it, that any eight year old could tell you what the problem is with assuming that things can get bigger and bigger when they only have a fixed amount of space to grow in.  

– But, it has taken the mavens of Wall Street until now to smell the coffee.

– Dennis

– – – – – – – – – – – – – – –

Commentary: Everything you know about economics is wrong

SAN LUIS OBISPO, Calif. (MarketWatch) — Yes, everything you know about economics is wrong. Dead wrong. Everything. The conclusions of economists are based on a fiction that distorts everything else. As a result economics is as real as one of the summer blockbusters like “Battleship,” “The Avenger” or “Prometheus.”

The difference is that the economic profession is a genuine threat, not entertainment. Economics dogma is on track to destroy the world with a misleading ideology.

Why? Because all economics is based on the absurd Myth of Perpetual Growth. Yes, all theories and business plans based on growth are mythological.

Economists are master illusionists who rely on a set of fictions, fantasies and forecasts that emanate from a core magical mantra of Perpetual Growth that goes untested year after year.

And yet it’s used to manipulate the public into a set of policies and decisions that are leading the American and the world economy down a path of unsustainable globalization and GDP growth assumptions that will self-destruct the planet.

– More…

NZ Asset Sales Policy Began On Wall Street

Saturday, June 23rd, 2012

 

– I love my new country but I do believe that New Zealanders can be naive.   Perhaps it is because of their long isolation.   But the stuff John Key, our current conservative PM, is trying to implement here is the same stuff that the Chicago Boys have tried around the world with repeatedly disastrous consequences.   

– And I’m reading that it will likely pass 61 to 60.   Isn’t it utterly amazing that not one of those 61 people will change their vote when the majority of New Zealanders clearly do NOT want asset sales.   One can only hope that the voters remember the transgressions of the 61 later at the polls.

– Read this analysis – it will curl your hair.

– Dennis

– – – – – – – – – – – – – – –

The Key government’s asset sales agenda is derived from the Washington Consensus – a set of Wall Street-driven policies that were pronounced dead after the global financial meltdown in 2008.[1] The New Zealand government, however, remains loyal to this failed ideology.

Why? The obvious link is Prime Minister John Key – a former investment banker for Merrill Lynch, the world’s largest brokerage failure.

In most other countries, state asset sales have become a last resort on the road to poverty and ruin, but for the Key government, asset sales are “business as usual.” [2]

So what’s really behind asset sales?
All wealth extraction is facilitated by international and national economic policies, coupled with the private banking system, which together deliver benefits to the financial elite by transferring wealth upward within and between nations.

 The state asset sales policy is just one of several reforms under the Washington Consensus, a set of monetary and economic policies designed to allow: the privatization of public resources and utilities, the removal of barriers to foreign investment and ownership, the sale of state assets, trade liberalization, deregulation, the lowering of business taxes, and cuts to public services.[3]

These “free market” reforms are collectively termed neoliberalism.[4] Simply, they provide big business with improved legal access to markets and assets worldwide.

The Key government’s asset sales agenda fits obediently into this ideology ? the same ideology that ushered in financial deregulation, record bank bailouts, and the Second Great Depression.[5]

Governments in New Zealand have succumbed to the neoliberal movement since 1987, when the first round of asset sales began, as a Reagan-Thatcher-Douglas experiment.

Under these policies since the 1980s, New Zealanders have experienced almost the greatest increase in income inequality in the OECD.[6]

The deep roots of neoliberalism 
Modern liberalism dates back to the end of World War II, when the Bretton Woods agreement formed the IMF and the World Bank, establishing the US dollar as a de facto world reserve currency, and installing policies aimed at stabilizing the world monetary system. Free private capital flows between countries were restricted because it was believed that international financiers had caused the Great Depression.[7]

For the next three decades, Western governments were characterized by liberal, socially democratic policies that sought to safeguard national economies by keeping trade in balance. The world achieved exceptional economic prosperity during this era known as “The Glorious Thirty” years.[8]

But by the 1970s, corporations began to exhaust the spending power of the “consumer society” as total debt increased under the mathematical bias of fractional reserve banking, exacerbated by the Vietnam War.

Policymakers were faced with a choice between more intervention to protect local economies and social justice, or a more liberal business agenda – neo (new) liberalism. Wall Street interests mobilized to advance a host of “business first” policies that became the Washington Consensus, and the euphoria for deregulation ultimately placed Wall Street beyond the reach of democratic public accountability.

Rising poverty and debt for the majority
Multinational corporations proliferated and expanded, outsourcing cheap foreign labour, extracting oil and other mineral wealth, leveraging weaker economies and favourable exchange rates to monopolise global markets, often assisted by IMF and World Bank development loans.

Globalization is defended as a strategy to boost Gross National Product (GDP) and therefore investment in jobs. But in reality, free trade strengthens capital bargaining relative to labour, so that people who derive most of their income from returns on capital (the rich) gain, while people who earn most of their income from labour (the majority) lose.[9]

The outcomes of neoliberal policies have been similar everywhere in the world. Deregulated markets have benefitted the local educated elite who work with the corporations, while the majority of people have experienced a decline in living standards, with a permanent widening of the gap between the rich and poor.[10] [11]

Neoliberalism has been catastrophic. It has accelerated sovereign debt, collapsed the financial sector, and it has caused the highest ever level of global unemployment, described recently by the International Labour Organization as a worldwide crisis.[12]

Meanwhile, the corporations and the international banking aristocracy have amassed enormous unproductive wealth via their trickle-up incomes.

“Free trade” unlocks foreign assets
The post-World War II version of free trade promoted “fair trade” and often achieved a healthy balance of payments. But the Washington Consensus threw caution to the wind, allowing big business to dominate government policy, making deficits routine.

Free trade agreements, such as the North American Free Trade Agreement (NAFTA), have virtually destroyed US-based manufacturing, leaving Main Street America with a service sector economy.[13]

The Trans Pacific Partnership Agreement (TPPA) signals yet another secretive free trade deal intended to free-up access to foreign assets. The TPPA could render New Zealand government decisions subject to rulings by international tribunals, in the defence of investors from the negotiating countries of Singapore, Chile, Brunei, Australia, Peru, Vietnam and the United States. This is how “free trade” agreements pave the way for the extraction of wealth ? by the erosion of economic sovereignty.

The Key government’s privatisation agenda is well advanced, with various private public partnerships (PPPs) already being developed. This neoliberal doctrine includes the privatization of prisons, schools, water resources, and all infrastructure.

Ultimately on offer is $5-20 trillion[14] in Crown mineral wealth, including gold, coal, lignite, phosphate, iron sand, oil, natural gas, and more, all under the fourth lowest royalty and taxation regime in the world[15] – a paltry 1% of the production value.[16]

“Mixed ownership model” is destined to fail
The Key government plans to sell 49% of four state owned energy companies – Mighty River Power, Meridian, Genesis, and Solid Energy, and a further 23% of Air New Zealand. It is claimed that $5–7 billion can be “freed up” to reduce debt.[17]

What really betrays these asset sales as an ideologically-based policy is the maths. Financial analyst Brent Sheather has calculated that the assets are earning a higher income than the cost of borrowing.

Currently, the cost of borrowing is 4% for ten years, so the cost of $6 billion would be $240 million. The forecast dividends of the four SOE energy companies average $449 million over the next five years, 49% of which is $220 million. Add $20 million for selling 23% of Air New Zealand and the lost dividends average $240 million a year.[18]

Now, add the sales related costs estimated at 3% or $180 million, plus the expected improved performance from substantial recent capital investment, and there is no way for New Zealand taxpayers to come out ahead.

As the Green’s co-leader Russel Norman has said:
“We have seen this before. Like our energy SOEs, Telecom had invested significant amounts of capital in building a modern telecommunications network in the years before privatisation. In the years following Telecom’s privatisation, dividend streams for its new private owners doubled, then tripled within six years. History now seems to be repeating itself with our energy SOEs. National has allowed the taxpayer to build up the asset, only to then on-sell it to the benefit of others.” [19]

The initial public offerings (IPOs) will be snapped up and passed on to larger offshore players, who with only a combined holding of 25% will enjoy foreign-owned status under the Overseas Investment Act (2005),[20] with ample influence at 49% to sway policy. So expect higher power prices.

Over the longer term, asset inflation will provide a mega windfall for shareholders.

In 1999, the NZ Herald reported that: ‘Over the past 12 years 40 state-owned commercial assets have been sold, realising $19.1 billion. As at August 31, 1999 these assets had an estimated value of $35.7 billion, $16.6 billion above their original sale price. … The privatisation programme has been a huge windfall for overseas investors. Just over 79 per cent, or $13.1 billion, of the increase in value has gone to offshore interests.’ [21] [22]

No political party can beat debt under our monetary system
New Zealand’s government debt is presently modest compared to private debt. In the short-term, tax reforms that enable a fairer redistribution of income would slow the deepening tide of all New Zealand debt ? if only the Key government would allow this.

But in our post-peak oil world, without cheap oil to fuel high productivity, sovereign debt in New Zealand ? as elsewhere, will inevitably force austerity measures consistent with the Washington Consensus. The past failure of these policies will be ignored, because ultimately there is simply no other option under the debt-based system.

Under fractional reserve banking the rate of growth of debt must be higher than the rate of growth of income to avoid collapse. In aggregate, debt grows exponentially until it cannot be repaid. [23] [24]The world is literally attempting to engage productive overdrive in a hopeless struggle to satisfy unproductive debt servicing.

Almost half of the average earned income is already siphoned off via direct or indirect hidden interest, and in government debt taxes.[25] In sum, almost half of humanity’s productive effort is to serve useless debt, instead of solve the world’s problems.

The pressure to leverage fiscal advantage from assets, of all kinds, comes directly from the ruling power – the international banking elite. No political party can entirely avoid asset extraction under the fractional reserve system. Governments can adjust the debt hand-brake, but the foreign bankers are in the driving seat.

The world is sliding toward zero and eventually negative growth. Sovereign debt can only speed up. New Zealand will join the economic train-wreck down the track.

The only escape route is a public medium of exchange that is debt-free.[26] Every sovereign nation can issue its own currency without debt or interest, but nearly all governments align with the international bankers to extort the “common wealth.”

The Reserve Bank of New Zealand issues less than 2% of the nation’s money debt-free,[27] serving the global central banking cartel, not ordinary Kiwis.

Selling public assets amounts to economic suicide
The European Central Bank (ECB) is clearly demonstrating how economic sovereignty can be wrested from countries through debt peonage.

The world on its present course cannot avoid fuel shortages, debt-deflation, fiscal austerity, increasing poverty, political and environmental conflicts over energy and essential commodities, unprecedented global protests against Wall Street financial injustice, political and legal challenges for full reserve monetary reform, climate and humanitarian disasters, further revolution and war.

We are facing the perfect economic storm, in which sacrificing long-term high performing income would guarantee poverty for the majority. Selling public assets amounts to economic suicide.

Most New Zealanders don’t realize that their country, and their future, is being sold.

________________________________________

[1] Anthony Painter. (2009, April 10). The Washington Consensus Is Dead. The Guardian., Kings Place, 90 York Way, London N1 9GU, UK.
http://www.guardian.co.uk/commentisfree/cifamerica/2009/apr/09/obama-g20-nato-foreign-policy

[2] Mixed Ownership Monitoring Unit(2011, December 15). Mixed Owner Model For Crown Companies. Crown Ownership Monitoring Unit , 1 The Terrace, Wellington 6011, New Zealand.
http://www.comu.govt.nz/publications/information-releases/mixed-ownership-model/

[3] John Williamson. (2004, September 24-25). A Short History of the Washington Consensus.
http://www.iie.com/publications/papers/williamson0904-2.pdf

[4] Neoliberalism. Wikipedia.
http://en.wikipedia.org/wiki/Neoliberalism

[5] Steve Keen. (2011, December 3). We’re Already In The Second Great Depression, We Just Don’t Realize It Yet.
http://articles.businessinsider.com/2011-12-03/markets/30471134_1_second-great-depression-hope-new-jobs

[6] OCED. (2011, December 5). Governments must tackle record gap between rich and poor, says OECD.
http://www.oecd.org/document/40/0,3746,en_21571361_44315115_49166760_1_1_1_1,00.html
‘The gap between rich and poor in OECD countries has reached its highest level for over 30 years, and governments must act quickly to tackle inequality, according to a new OECD report. “Divided We Stand: Why Inequality Keeps Rising” finds that the average income of the richest 10% is now about nine times that of the poorest 10 % across the OECD.’

[7] Jan A. Kregal. (2003, April). The Perils of Globalization: Structural, Cyclical and Systemic Causes of Unemployment
http://www.cfeps.org/pubs/sp-pdf/SP13-Jan.pdf
‘In the view of US Secretary of the Treasury Morganthau the creation of the Bretton Woods institutions was to keep the control of the international financial system out of the hands of international financiers who were considered to have caused the Great Depression. Keynes agreed that free private international capital flows were incompatible with a stable international financial system and this similarity of views produced a post-war system in which it was presumed that there would be virtually no private international capital flows.’

[8] Embedded Liberalism. The Glorious Thirty years. Wikipedia.
http://en.wikipedia.org/wiki/Neoliberalism
‘The period of government interventionism in the 1950s and 1960s was characterized by exceptional economic prosperity, as economic growth was generally high, was contained, and economic distribution was comparatively equalized. This era is known as les Trente Glorieuses (“The Glorious Thirty [years]”) or “Golden Age”, a reference to many countries having experienced particularly high levels of prosperity between (roughly) World War II and 1973.’

[9] Ian Fletcher. (2011). Free Trade Doesn’t Work, Why the Theory of Comparative Advantage is Wrong.
http://www.worldfinancialreview.com/?p=866
‘As a result, people who draw most of their income from returns on capital (the rich) gain, while people who get most of their income from labor (the rest) lose.’

[10] Richard C. Cook. (2007, June 2). Monetary Causes of the Immigration Crisis. The “Washington Consensus” has wrecked their economies. Global Research.
http://www.globalresearch.ca/PrintArticle.php?articleId=5862
‘The conditions also include a shift of indigenous economies to the production of export commodities, away from local self-sustaining agriculture and small business. This typically results in a mass exodus from rural areas to urban slums and causes poverty, unemployment, and crime. These financial programs benefit the local educated elite who work with the Western agencies and global corporations but cause a deep and permanent stratification among social classes.’

[11] OCED. (2011, December 5). Governments must tackle record gap between rich and poor, says OECD.
http://www.oecd.org/document/40/0,3746,en_21571361_44315115_49166760_1_1_1_1,00.html

[12] ILO. (2011). Global Employment Trends 2011. International Labour Office, CH-1211 Geneva 22, Switzerland.
http://www.ilo.org/wcmsp5/groups/public/@dgreports/@dcomm/@publ/documents/publication/wcms_150440.pdf

[13] Robert E. Scott. (2011, May 3). Heading South: US-Mexico Trade And Job Displacement After NAFTA. Economic Policy Institute, 1333 H Street NW, Suite 300 East Tower, Washington DC 20005, USA, www epi.org.
http://www.epi.org/page/-/BriefingPaper308.pdf

[14] Dr. Don Elder. (2010, September 21). CEO, Solid Energy. Day 2 presentation at the 2010 New Zealand Petroleum Conference, Skycity Convention Centre, Auckland, during which Dr Elder has been quoted as stating that New Zealand has NZ$ 5-20 trillion in Crown minerals.
http://www.nzpam.govt.nz/cms/pdf-library/petroleum-conferences-1/2010-nzpc-speaker-presentations/Don%20Elder.pdf
[15] IPENZ, authorship withheld. (2011, December). Realizing Our Hidden Treasure: Responsible Mineral and Petroleum Extraction. The Institution of Professional Engineers New Zealand Inc., PO Box 12 241, Wellington 6144, New Zealand.
http://www.ipenz.org.nz/ipenz/media_comm/documents/IPENZMineralsandPetroleumFinalDec2011.pdf

[16] Taxation & Royalties for Mining Companies. New Zealand Mineral Industry Association. PO Box 24315, Wellington 6142, New Zealand.
http://www.minerals.co.nz/html/main_topics/overview/taxation_royalties.html
‘The Ministry of Commerce has recently imposed a royalty on minerals owned by the Crown. The royalty is the greater of 1% ad valorem (value of production) or 5% of accounting profits.’

[17] Mixed Ownership Monitoring Unit(2011, December 15). Mixed Owner Model For Crown Companies. Crown Ownership Monitoring Unit,1 The Terrace, Wellington 6011, New Zealand.
http://www.comu.govt.nz/publications/information-releases/mixed-ownership-model/

[18] Gordon Campbell. (2011, November 24). Gordon Campbell: financial analysts jump ship on asset sales.
http://www.scoop.co.nz/stories/HL1111/S00215/gordon-campbell-financial-analysts-jump-ship-on-asset-sales.htm

[19] Dr Russel Norman. (2011, November 23). National Set To Repeat Telecom Privatisation Mistake.
http://www.voxy.co.nz/politics/national-set-repeat-telecom-privatisation-mistake/5/108571

[20] Overseas Investment Act (2005). Section 7 (1). ‘…or they are 25% (or more) owned or controlled by an overseas person or persons.’ Parliamentary Counsel Office., PO Box 18070, Wellington 6160, New Zealand.
http://www.legislation.govt.nz/act/public/2005/0082/latest/DLM356881.html

[21] Bryan Gaynor, NZ Herald. (1999, October 2). Analysis: Filling Foreigner’s Pockets. The New Zealand Herald, PO Box 32, Auckland, New Zealand.
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=15142

[22] The Treasury. (1999, September 30). Income from State Asset Sales. Historical information on the sale price and background to New Zealand Government asset sales as at 30 September 1999. The Treasury, Level 5 (Reception), 1 The Terrace, Wellington 6011, NEW ZEALAND.
http://www.treasury.govt.nz/government/assets/saleshistory

[23] Michael Hudson. (2004, January 24). The Mathematical Economics of Compound Rates of Interest: A Four-Thousand Year Overview Part I.
http://michael-hudson.com/2004/01/the-mathematical-economics-of-compound-rates-of-interest-a-four-thousand-year-overview-part-i/
‘Orthodox academic models rarely acknowledge the problems posed by the exponential growth of debt overhead. Such models typically make government policies appear unnecessary to cope with this problem, by focusing on the kind of world that might exist if the financial overgrowth of savings and debts did not double every decade or so, having multiplied again and again over the past century. It thus has been left mainly to non-mainstream writers to address the structural problems created by an accumulation of interest-bearing debt.’

[24] Debt Grows Exponentially. (2010, October 30). The Elephant In The Room: Debt Grows Exponentially, While Economies Only Grow In An S-Curve. Washington’s Blog.
The Elephant In The Room: Debt Grows Exponentially, While Economies Only Grow In An S-Curve
‘Hudson says that – in every country and throughout history – debt always grows exponentially, while the economy always grows as an S-curve. Moreover, Hudson says that the ancient Sumerians and Babylonians knew that debts had to be periodically forgiven, because the amount of debts will always surpass the size of the real economy. … One thing is for sure. The exponential growth of debt is a structural problem which – unless directly addressed – will swallow all economies which try to ignore it.’

[25] Margrit Kennedy. (1995). Interest and Inflation Free Money. Creating an exchange medium that works for everybody and protects the earth. Published by Seva International, ISBN 0-9643025-0-0.
http://kennedy-bibliothek.info/data/bibo/media/GeldbuchEnglisch.pdf
‘On an average we pay about 50% capital costs in the prices of our goods and services. Therefore, if we could abolish interest and replace it with another mechanism to keep money in circulation, most of us could either be twice as rich or work half of the time to keep the same standard of living we have now.’ (Other estimates are 40-45%.)

[26] Positive Money NZ. A campaign for Full Reserve Banking, based on similar campaigns in the UK and USA.
http://www.positivemoney.org.nz/

[27] Deirdre Kent. (2011, November). Money For Nothing. New Zealand Investor.
http://most0010122.e-xpert.co.nz/includes/download.aspx?ID=118572

 

– To the original article…

– Research thanks to Kierin  M.

 

We’ve been brainwashed

Friday, June 15th, 2012

It’s no accident that Americans widely underestimate inequality. The rich prefer it that way.

How, in a democracy supposedly based on one person one vote, could the 1 percent could have been so victorious in shaping policies in its interests? It is part of a process of disempowerment, disillusionment, and disenfranchisement that produces low voter turnout, a system in which electoral success requires heavy investments, and in which those with money have made political investments that have reaped large rewards — often greater than the returns they have reaped on their other investments.

There is another way for moneyed interests to get what they want out of government: convince the 99 percent that they have shared interests. This strategy requires an impressive sleight of hand; in many respects the interests of the 1 percent and the 99 percent differ markedly.

The fact that the 1 percent has so successfully shaped public perception testifies to the malleability of beliefs. When others engage in it, we call it “brainwashing” and “propaganda.” We look askance at these attempts to shape public views, because they are often seen as unbalanced and manipulative, without realizing that there is something akin going on in democracies, too. What is different today is that we have far greater understanding of how to shape perceptions and beliefs — thanks to the advances in research in the social sciences.

It is clear that many, if not most, Americans possess a limited understanding of the nature of the inequality in our society: They believe that there is less inequality than there is, they underestimate its adverse economic effects, they underestimate the ability of government to do anything about it, and they overestimate the costs of taking action. They even fail to understand what the government is doing — many who value highly government programs like Medicare don’t realize that they are in the public sector.

– More …