The United States of Plutocracy

Posted on Sep 8, 2009
By William Pfaff

The United States has for practical purposes been a plutocracy for some years now. American national elections usually function more or less correctly, except that they have become all but completely dominated by money.

The contributors of money to Senate and House campaigns are dominated by the source of that money, and the source of the money is the United States government, which directs it to them as a result of the contracts awarded to them by the House and Senate members whose election they support. The process is circular.

It would be cheaper for all concerned if business were directly to pay senators and representatives and eliminate the middlemen, the parasites who live on the surplus money in this system, paid for their ability to persuade both sellers and buyers (so to speak) that they are providing a service by facilitating the bargain. Elections now cannot take place without them.

There would seem to be two steps by which this rot has taken hold.

The first is change in the legislation originally concerned with the use by broadcasters of the airwaves, a public resource. In 1934 the Federal Communications Commission was established with authority over broadcasts. Being a politically balanced body, it decreed that the public service obligation of the broadcaster included the responsibility to provide balanced information. (The Fox News claim to be “fair and balanced” is a sneering reference to this, no doubt unintentional.)

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The New American Plutocracy

by Paul Kurtz
The following article is from Free Inquiry magazine, Volume 20, Number 4.

Plutocracy: (1) government by the wealthy, (2) a controlling class of the wealthy. From the Greek ploutokratia, from ploutos, wealth, and kratia, advocate of a form of government.

I am deeply troubled by the fact that in the upcoming presidential and congressional elections there is little or no debate on what I consider to be a central issue for the American future: the emergence of a new and powerful plutocracy wedded to corporate power. Regrettably, none of the major candidates will deign to even discuss this vital question. Only Ralph Nader has identified it. But he has largely been ignored or parodied by the mass media. Typically, Paul Krugman, op-ed columnist for the New York Times, has ridiculed Nader precisely for his attacks on “corporate power.” Senator John McCain did raise the issue of the special interests and soft money corrupting the political process. But he has been rebuffed and has climbed into the same bed with Bush. Many do not consider Nader to be a viable candidate, for the Green Party does not represent an effective political coalition. Neither Free Inquiry nor the Council for Secular Humanism can endorse political candidates, but this should not preclude me from presenting my own personal views about the deeper humanist issues at stake.

A plutocracy is defined as “government by the wealthy.” The critical question that should concern us is whether the United States is already a plutocracy, and what can be done to limit its power. This question, unfortunately, will not be taken seriously by most voters-but it damned well ought to be.

Ancient Greek democracy lasted only a century; the Roman republic survived for four, though it was increasingly weakened as time went on. As America enters its third century we may well ask whether our democratic institutions will survive and if so in what form.

As readers of these pages know, I have been concerned by the virtually unchallenged growth of corporate power. Mergers and acquisitions continue at a dizzying pace, as small and mid-sized businesses and farms disappear; independent doctors, lawyers, and accountants are gobbled up by larger firms; and working men and women are at the mercy of huge global conglomerates, which downsize as they export jobs overseas.

I have also deplored the emergence of the global media-ocracy, whereby a handful of powerful media conglomerates virtually dominate the means of communication. A functioning democratic society depends upon a free exchange of ideas; today fewer dissenting views are heard in the public square, as diversity is narrowed or muffled.

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YAHOO: Preparing for the Worst

by Robert Kiyosak

Posted on Monday, August 24, 2009, 12:00AM

“Is the crisis over?” is a question I am often asked. “Is the economy coming back?”
My reply is, “I don’t think so. I would prepare for the worst.”

Like most people, I wish for a better future for all of us. Life is better when people are working, happy, and spending money.

The stock market has been going up since March 9, 2009. Talk of “green shoots” fill the air. Yet, in spite of the more positive news, I continue to recommend that people prepare for the worst. The following are some of my reasons:

1. I believe the stock market is being manipulated. I suspect the government, banks, and Wall Street are doing everything they can to keep the market from crashing. Our leaders know that nothing makes the world feel better than a raging bull market.

Do I have any proof that the market is being manipulated? No. I just smell a rat, or a pack of rats. I believe greed, self-interest, arrogance, and fear control the financial markets. I suspect those in charge will do anything to keep us all from panicking… and I don’t blame them. A global panic would be ugly and dangerous.

2. In my view, this global crisis has been caused by the Federal Reserve Bank, the U.S. Treasury, Wall Street, and the central banks of the world. They caused the problem, profited excessively in doing so, and now profit by being asked to fix the problem.

Every time I hear a politician mention the word stimulus, my mind flashes back to high school biology class, when I touched battery wires to a dead frog to make it twitch. Today, you and I are the dead frogs. Pretty soon the dead frog will be fried frog.

In the 1980s, our government’s hot money stimulus was measured only in the millions of dollars. By the 1990s, the government had to ramp the stimulus voltage into the billions in order to get the frog to twitch. Today the frog has jumper cables with trillions in high-voltage hot money pouring through the lines.

While most us feel better when we have more high-voltage money in our hands, none of us feel good about higher taxes, increasing national debt, and rising inflation for the long term. Another old saying goes, “Sometimes the cure is worse than the disease.” I say the government stimulus cure is killing us frogs.

3. Old frogs don’t hop. Another reason I am cautious about the future is that the Western world has a growing number of old frogs. Between 1970 and 2000, the economy responded to bailouts and stimulus packages because the baby boomers of the world were entering their greatest earning years — their purchasing power increased, and demand for homes, cars, refrigerators, computers, and TVs boosted the economy.

The stimulus plans seemed to work. But when a person turns 60, their spending habits change dramatically. They stop consuming and start conserving like a bear preparing for winter. The economy of the Western world is heading into winter. Hot wires and hot money will not get old frogs to hop. Old frogs will simply join the bears and stick that money in the bank as they prepare for the long, hard winter known as old age. The businesses that will do well in a winter economy are drug companies, hospitals, wheelchair manufacturers, and mortuaries.

4. The dying frog economy will lead us to the biggest Ponzi schemes of all: Social Security and Medicare. If we think this subprime financial crisis is big, it’s my opinion that this crisis will be dwarfed by the crisis brewing in Social Security and Medicare…Medicare being the biggest crisis of all. As old frogs head for the big lily pad in the sky, they will demand young frogs spend even more in tax dollars just to keep old frogs from croaking.

5. The 401(k)Ponzi scheme. A Ponzi scheme, like the scheme Madoff ran, depends upon young money to pay off old money. In other words, a Ponzi scheme needs tadpoles to finance old frogs. The same is true for the 401(k) and other retirement plans to work. If young money does not come into the stock market, the old money cannot retire. One reason so many people my age are worried, not only about Social Security and Medicare, is because they’re concerned about getting their money out of the stock market before the other old frogs decide to drain the swamp.

The facts are that the 401(k) plan has a trigger that requires old frogs to begin withdrawing their money at a certain age. In other words, as baby boomers grow older, more and more will be required, by law, to begin withdrawing their money from the market. You do not have to be a rocket scientist to know that it is hard for a market to keep going up when more and more people are getting out.

The reason the 401(k) has this law related to mandatory withdrawals is because the Federal government wants to collect the taxes that they deferred when the worker’s money went into the plan. In other words, the taxman wants their pound of flesh. Since they allowed the worker to invest without paying taxes, the government wants their tax dollars when the employee retires. That is why the laws require older workers to sell their shares ¬– and pay their pound of flesh.

Demographics show that we are entering a battle between young and old. I call it the “Age War.” The young want to hang onto their money to grow their families, businesses, and wealth. The old want the tax and investment dollars of the young to sustain their old age.

This war is not coming…it is upon us now. This is one of many reasons why I remain cautious and say, “The worst is yet to come.”

Police to investigate News of the World phone-hacking claims

By: David Batty
guardian.co.uk, Thursday 9 July 2009 11.55 BST
Article history

The Metropolitan police is to examine allegations that journalists from theNews of the World and other newspapers repeatedly used criminal methods to get stories through mobile phone hacking.

The assistant commissioner, John Yates, is to “establish the facts” about the claims and will report back later today, the police commissioner, Sir Paul Stephenson, said today.

The move came after the Guardian revealed Rupert Murdoch’s News Group Newspapers had paid out more than £1m to settle legal cases that threatened to reveal evidence of the journalists’ activities.

The payments secured secrecy over out-of-court settlements in three cases that threatened to expose evidence that Murdoch journalists used private investigators to illegally hack into the mobile phone messages of public figures to gain unlawful access to confidential personal data, including tax records, social security files, bank statements and itemised phone bills. Cabinet ministers, MPs, actors and sports stars were all targets of the private investigators.

The suppressed legal cases are linked to the jailing in January 2007 of a News of the World reporter, Clive Goodman, for hacking into the mobile phones of three royal staff, an offence under the Regulation of Investigatory Powers Act. At the time, News International said it knew of no other journalist who was involved in hacking phones and that Goodman had acted without their knowledge.

Scotland Yard and the Crown Prosecution Service now face serious questions over their handling of the inquiry into phone hacking and the News of the World, which led to the jailing of Goodman and Glenn Mulcaire, a private investigator who had worked for News Group.
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Dashing Fabricated Hopes: The Meaning of Ahmadinejad’s Victory

By Pierre Tristam

June 14, 2009 “Pierre’s Middle East Issues Blog” — It’s been a little weird, if not embarrassing, to witness the reactions of the American press to the Iranian election in the last 24 hours.

There was the initial rush of expectation–that “change” was as much in the Iranian air as it had been in the American last fall, an equivalence so wrong on so many fronts that it managed to obscure the essential truth of the Iranian election: there never was a significant ideological difference between Mahmoud Ahmadinejad and Mir Hossein Mousavi. Only a tonal one. But the Los Angeles Times was content to blare this headline: “Iranians ready to decide presidency — and maybe much more.”

There was the added irony of the LATimes’ sub-headline: “The winner will play a key role in possible talks over Iran’s nuclear program and support for militant groups,” the implication being that if Mousavi were the winner, maybe he’d rein back the militants. But it was Mousavi who, as Iran’s prime minister in the 1980s, helped build those militant groups into international terrorist forces, sending money, weapons and manpower to Lebanon to beef up Hezbollah and telegraphing their targets, including that string of American and European hostages Hezbollah held for most of the decade—and Mousavi traded for, haggling over anti-tank missiles and money with Oliver North and Bud McFarlane, in the infamous Iran-contra affairs.

Still, the paper in Los Angeles, not to mention the New York Times and the Washington Post, have blithely referred to Mousavi as a “moderate” throughout the election campaign, accepting at face value his apparent conversion, if only because he kept his antipathy for the United States relatively silent.

But Slate’s Samuel Rosner was closer to reality: The Iranian president isn’t the one who decides Iran’s fate, or foreign policy, or domestic policy, for that matter. It’s Ali Khamenei, the “supreme leader,” who does. But the big papers kept up the charade (“As Iran Votes, Talk of a Sea Change,” went The New York Times), as if willing the fantasy.

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How the spooks took over the news

This is an edited extract from “Flat Earth News: an award-winning reporter exposes falsehood, distortion and propaganda in the global media”, published by Chatto & Windus. In his controversial new book, Nick Davies argues that shadowy intelligence agencies are pumping out black propaganda to manipulate public opinion – and that the media simply swallow it wholesale

Onthe morning of 9 February 2004, The New York Times carried an exclusive and alarming story. The paper’s Baghdad correspondent, Dexter Filkins, reported that US officials had obtained a 17-page letter, believed to have been written by the notorious terrorist Abu Musab al Zarqawi to the “inner circle” of al-Qa’ida’s leadership, urging them to accept that the best way to beat US forces in Iraq was effectively to start a civil war.

The letter argued that al-Qa’ida, which is a Sunni network, should attack the Shia population of Iraq: “It is the only way to prolong the duration of the fight between the infidels and us. If we succeed in dragging them into a sectarian war, this will awaken the sleepy Sunnis.”

Later that day, at a regular US press briefing in Baghdad, US General Mark Kimmitt dealt with a string of questions about The New York Times report: “We believe the report and the document is credible, and we take the report seriously… It is clearly a plan on the part of outsiders to come in to this country and spark civil war, create sectarian violence, try to expose fissures in this society.” The story went on to news agency wires and, within 24 hours, it was running around the world.

There is very good reason to believe that that letter was a fake – and a significant one because there is equally good reason to believe that it was one product among many from a new machinery of propaganda which has been created by the United States and its allies since the terrorist attacks of September 2001.

For the first time in human history, there is a concerted strategy to manipulate global perception. And the mass media are operating as its compliant assistants, failing both to resist it and to expose it.

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Do You Believe This Lady?

FactsNews – Get ready for a blitz of hard hitting financial news articles. Credit to  SurvivalBlog.com for posting such troubling articles on a daily basis…

Reposted from The Market Ticker

Now for some facts, after you watched the government propaganda.  All of these facts, unlike that propaganda, are in fact mathematical realities.

From Bloomberg:

The agency’s deposit insurance fund, supported by fees paid by banks, fell to $13 billion in the first quarter from $17.3 billion in the preceding three-month period. The FDIC has imposed an emergency fee to raise $5.6 billion to rebuild the fund, with more assessments possible this year. The agency forecasts failures will cost $70 billion through 2013.

The FDIC lost most of its $50 billion original stake due to mismanagement, refusal to close troubled institutions, and according to the Office of The Inspector General:

May 21 (Bloomberg) — The Office of Thrift Supervision authorized “inappropriate” backdating of capital by six institutions, including IndyMac Bancorp Inc., that led to “misleading financial reporting,” the U.S. Treasury inspector general said in a report.

Oversight failures were “very serious” and included a senior deputy director in August instructing a lender to backdate and a regional director authorizing revised accounting, according to the report today. OTS left unchanged revisions at three unidentified thrifts. Republican Senator Charles Grassley said the actions were “completely unacceptable” and a congressional subcommittee planned an investigation.

IndyMac subsequent to this event failed and has cost the FDIC insurance fund a very substantial amount of money and we are not even being told who the other three institutions are or whether they are still operating!

How much is the $13 billion in FDIC insurance?

The FDIC insures 4.8 trillion dollars in deposits in US banks and thrifts, and yet they have 0.27% – more than two-thirds less than they had a bit more than a year ago – in money to “cover” those deposits.

It is true that the FDIC also has the ability to borrow (up to $100 billion now, and they are trying to secure the ability to borrow up to $500 billion) from Treasury should they run short of money.

It is true that nobody has (yet) ever lost one penny of insured funds at an American bank.

And finally, it is almost certainly true that should Congress have to print up literally any amount of money, irrespective of whether that printing of raw money drives oil to $300 a barrel, gasoline to $10 a gallon, and bread to $20 a loaf, in order to prevent the FDIC from being able to pay you with (perhaps worthless) dollars, they will – because they understand full well that the alternative could quite easily be that you reach for a pitchfork – or worse.

But if you believe that having 0.27% of the insured base of deposits as a reserve, having lost more than two thirds of the original reserve due to malfeasance and misfeasance, when not one person has been indicted, prosecuted or imprisoned for their misconduct over the previous two years constitutes “well-capitalized, prudently operated and able to meet insurance obligations”…….

… you are free to believe that.

I will however strongly suggest that you investigate the facts for yourself before believing Susie Orman playing “mouthpiece” for a clearly-desperate regulatory apparatus that has allowed the wholesale looting of the American Taxpayer to occur – a regulatory apparatus and government, from the top down that will, it appears, continue to rob you blind until and unless you, the people, demand that it stop.

Disclosure: Short the American people, who appear to be as dumb as a box of rocks for putting up with this crap.