who can give up essential
liberty to obtain a little temporary
safety, deserve neither liberty
-- Benjamin Franklin
"All governments lie and nothing
say should be believed."
"Power tends to corrupt, and
absolute power corrupts
absolutely. Great men
almost always bad men."
1. Capitalism simply isn't
working and here are the reasons
2. Silicon Valley could force NSA reform, tomorrow. What's
taking so long?
3. Retiring Obama Administration
Prosecutor Says the SEC
Is Corrupt (...)
4. The Government Listens To
Lobbyists And The Wealthy,
Not You And Me
If Waterboarding Isn't Torture, Cheney Should Try It
This is the Nederlog of April
13. It is another crisis
There are again 5 articles, on a Sunday. This starts with an article about
"Capital in the Twenty-First Century", also billed as "Capital". There
is more on the failures of Silicon Valley, of Obama and of the American
government, and it ends today with a request made to Dick Cheney.
simply isn't working and here are the reasons why
The first article today is by
Will Hutton on The
Observer (the world's oldest Sunday newspaper since 1791, and a
sister paper to The Guardian):
This starts as follows:
I am going to spend a
litte more attention to this than I might have otherwise, (1) because
my parents, who were communists, agreed with the thesis that
"capitalism simply isn't working" and (2) because Piketty's book may be
Suddenly, there is a new
economist making waves – and he is not on the right. At the conference
of the Institute of New Economic Thinking in Toronto last week, Thomas
Piketty's book Capital in the Twenty-First Century got at
least one mention at every session I attended. You have to go back to
the 1970s and Milton Friedman for a single economist to have had such
Like Friedman, Piketty is
a man for the times. For 1970s anxieties about inflation substitute
today's concerns about the emergence of the plutocratic rich and their
impact on economy and society. Piketty is in no doubt, as he indicates in
an interview in today's Observer New Review, that the current level
of rising wealth inequality, set to grow still further, now imperils
the very future of capitalism. He has proved it.
Also, there is in this section another dotted article, from The
Guardian. As a matter of fact, it is my guess is that both journalists
did not quite get Piketty's argument, but that is a mere guess,
although it parallels relatively many other economists whose academic
works also rarely got properly understood by journalists.
In any case, here is the outline of the argument given by Will Hutton,
whose article I will first deal with:
argues, is blind. Once its returns – investing in anything from
buy-to-let property to a new car factory – exceed the real growth of
wages and output, as historically they always have done (excepting a
few periods such as 1910 to 1950), then inevitably the stock of capital
will rise disproportionately faster within the overall pattern of
output. Wealth inequality rises exponentially.
Yes, indeed. And as I
have argued before, many of the evil outgrowths of capitalism can be
tamed by adequate laws - except that these laws, which were in place,
at least to a considerable extent, from the fifties till the seventies,
I suppose mostly thanks to John Maynard
Keynes, were all undone by deregulation: See my Crisis + DSM-5: It's the
The process is made worse
by inheritance and, in the US and UK, by the rise of extravagantly paid
"super managers". High executive pay has nothing to do with real merit,
writes Piketty – it is much lower, for example, in mainland Europe and
Japan. Rather, it has become an Anglo-Saxon social norm permitted by
the ideology of "meritocratic extremism", in essence, self-serving
greed to keep up with the other rich. This is an important element in
Piketty's thinking: rising inequality of wealth is not immutable.
Societies can indulge it or they can challenge it.
Here is the lesson of the past:
The lesson of the
past is that societies try to protect themselves: they close their
borders or have revolutions – or end up going to war. Piketty fears a
repeat. His critics argue that with higher living standards resentment
of the ultra-rich may no longer be as great – and his data is under
intense scrutiny for mistakes. So far it has all held up.
Well, the higher living
standards are falling apart for the majority. And I agree that, given
these, there are better and better chances for a revolution or a war,
especially as more and more people grow poorer in the West, where they
have grown richer from the fifties onwards into the eighties.
And here are the solutions:
The solutions – a top
income tax rate of up to 80%, effective inheritance tax, proper
property taxes and, because the issue is global, a global wealth tax –
are currently inconceivable.
But as Piketty says, the
task of economists is to make them more conceivable. Capital
certainly does that.
I do not think these
solutions are "currently
inconceivable": they are quite
conceivable, simply because (1) they were quite normal, and (2) they do
not imply any large losses for the rich either.
But they are currently impracticable,
it seems mostly because the rich have succeeded in buying most
politicians, who indeed were very glad to be bought, and tend these
days to be, when powerful, "revolving door types": from professor to
parliamentarian to mayor or minister and back to professor again is
quite typical, for the several hundreds or thousands of these in each
country, both from "the left" and the right, and there also might be a
management stint inbetween.
Here is the other article,
by Andrew Hussey on The Observer:
First, as to what
Piketty has done, at least according to fellow economists:
status of the book was recognised by a recent long essay in the New Yorker in which
Branko Milanovic, a former senior economist at the World Bank, was
quoted as describing Piketty's volume as "one of the watershed books in
economic thinking". In the same vein, a writer in the Economist
reported that Piketty's work fundamentally rewrote 200 years of
economic thinking on inequality.
I think myself that this
is in part exaggeration, although it may be true that this is a
watershed book - time will tell.
Here is part from the interview Hussey had with Piketty:
"I began with a
straightforward research problematic," he says in elegant
French-accented English. "I began to wonder a few years ago where was
the hard data behind all the theories about inequality, from Marx to
David Ricardo (the 19th-century English economist and advocate of free
trade) and more contemporary thinkers. I started with Britain and
America and I discovered that there wasn't much at all. And then I
discovered that the data that did exist contradicted nearly all of the
theories including Marx and Ricardo. And then I started to look at
other countries and I saw a pattern beginning to emerge, which is that
capital, and the money that it produces, accumulates faster than growth
in capital societies. And this pattern, which we last saw in the 19th
century, has become even more predominant since the 1980s when controls
on capital were lifted in many rich countries."
I agree, but I do so
basically because this gets also underpinned by the Dutch saying that
"the devil always shits on the largest heap": growth needs to be redistributed,
and is so mostly by taxation, which is "the way to buy
civilization" as Supreme Court judge Oliver Wendell Holmes Jr. put it,
while if it is not redistributed, it will only make the few rich even
richer than they were when properly taxed.
Next, there is this:
What have we
learned? Capitalism is bad. Hooray! What's the answer? Socialism? Hope
so. "It is not quite so simple," he says, disappointing this former
teenage Marxist. "What I argue for is a progressive tax, a global tax,
based on the taxation of private property. This is the only civilised
solution. The other solutions are, I think, much more barbaric – by
that I mean the oligarch system of Russia, which I don't believe in,
and inflation, which is really just a tax on the poor."
I was a teenage marxist
as well, but gave it all up when 20, and one of my main reasons for
giving up on socialism is that I never saw it work well, except
on a very small scale, while I also saw that all nominally
"socialist states" were in fact totalitarian
Also, while in principle these totalitarian dictatorships might have been tamed by
laws, this is very improbable once so much economic, social,
religious, legal and educational power has been concentrated in so few
hands, which is what state socialism is and does: concentrate all
hitherto independent or semi-dependent powers in the state, that is, in
the hands of the few who run the state.
So I quite agree with Piketty here: By far the least barbaric solution
to the crisis of capitalism is taxation of private property.
Finally, there is this from Hussey (and much more under the last dotted
economists he insists that economic thinking cannot be separated from
history or politics; this is what gives his book the range the American
Nobel laureate Paul
Krugman described as "epic" and a "sweeping vision".
2. Silicon Valley could force NSA reform,
taking so long?
The next item is an
article by Trevor Timm on The Guardian:
This starts as follows:
Yes, indeed. So here is
my answer to the question in the title: The CEOs do not want a
strong NSA reform, mostly because the NSA does the same things
as they do: Find the private and personal details of their users (and
sell these to advertisers).
With Glenn Greenwald and
Laura Poitras triumphantly
returning to the US to accept the Polk Award with Barton Gellman
and Ewan MacAskill yesterday, maybe it's time we revisit one of their first
important stories: how much are internet
companies like Facebook and Google helping the
National Security Agency, and why aren't they doing more to stop it?
The CEOs of the major
tech companies came out of the gate swinging 10 months ago, complaining
loudly about how NSA surveillance has been destroying privacy and
ruining their business. They still are. Facebook founder Mark
Zuckerberg recently called
the US a "threat" to the Internet, and Eric Schmidt, chairman of
Google, called some of the NSA tactics "outrageous"
and potentially "illegal".
They and their fellow Silicon Valley powerhouses – from Yahoo to
Dropbox and Microsoft to Apple and more
– formed a coalition calling for surveillance reform and had
conversations with the White House.
But for all their talk, the
public has come
away empty handed.
The difference is that the NSA is not known to sell what they find to
advertisers (though lots may be interested), but that is because they
are paid from the taxes anyway.
In fact, here is what the CEOs of the major tech companies could do:
Namely with the Sopa
(Stop Online Piracy Act). But so far it did not happen, and I gave my
main reason why it didn't: it is against their own interests,
which is getting paid for the personal private data they got from their
users, usually not honestly, and certainly not openly.
The leading internet
companies could easily force Congress' hand by pulling an OKCupid: at
the top of your News Feed all next week, in place of Monday's Google
doodle, a mobile push alert, an email newsletter: CALL YOUR MEMBER
OF CONGRESS. Tell them to SUPPORT THE USA FREEDOM ACT and tell the NSA
to stop breaking common encryption.
We know it's worked before.
There is considerably more in the last dotted article.
3. Retiring Obama Administration Prosecutor Says
the SEC Is Corrupt; Prior Reports Indicate Administration's Corruption
next item is an
article by Eric Zuesse on OpEdNews:
This starts as
on April 8th, that a Securities and
Exchange Commission prosecuting attorney, James Kidney, said at his
retirement party on March 27th, that his prosecutions of Goldman Sachs
other mega-banks had been squelched by top people at the agency,
"were more focused on getting high-paying jobs after their government
service than on bringing difficult cases." He suggested that SEC
knew that Wall Street would likely hire them after the SEC at much
than their government remuneration was, so long as the SEC wouldn't
those megabank executives on any criminal charges for helping to cause
mortgage-backed securities scams and resulting 2008 economic crash.
drew applause from the crowd
of about 70 people," according to the Bloomberg report. This would
indicate that other SEC prosecutors feel similarly squelched by their
said that his superiors did
not "believe in afflicting the comfortable and powerful."
Referring to the
agency's public-relations tactic of
defending its prosecution-record by use of what he considered to be
statistics, Kidney said, "It's a cancer" at the SEC.
There is a lot more,
spread over two pages. Here is a selection on Obama (about whom there
is a lot more in the article):
That indeed seems to be
the case. Here is part of Zuesse's sum up:
He had been lying to the
public, all along. Not only would
he not prosecute the banksters, but he would treat them as if all they
"an acute public relations problem that's turning into a political
problem." And he thought that the people who wanted them prosecuted
like the KKK who had chased Blacks with pitchforks before
DOJ, their Financial Fraud Enforcement Task Force (FFETF) was
"established by President Barack Obama in November 2009 to wage
an aggressive, coordinated and proactive effort to investigate and
prosecute financial crimes." But, according to the Department's IG,
it was all a fraud: a fraud that according to the DOJ itself had been
since at least November 2009.
have a hard time deciding whether Obama was the most corrupt President
-- even more corrupt than Grant, Harding, and G.W. Bush -- but
certainly he is one of the four most corrupt. The evidence that he is
presiding over an Administration in which aristocrats can do anything
they want and commit any crime with total impunity, extends not just to
Obama's protection of George W. Bush from prosecution, but to his
protection of Wall Street CEOs from prosecution. Only blue-collar
crooks are pursued by him; white-collar ones get off easy, and
mega-corporate CEOs (as well as torturers and their masters in the
former Administration, and the traitors who lied this nation into
invading Iraq) are totally immune from prosecution by him.
Obama is fundamentally a
conservative, who parades in Democratic rhetoric. The reports and
studies that have been presented here are convincing proof of that.
And you can check
this by consulting the last dotted article.
The Government Listens To Lobbyists And The Wealthy, Not
You And Me
Next, an article by
Bryce Covert on Think Progress:
This starts as
When organized interest
groups or economic elites want a particular policy passed, there’s a
strongly likelihood their wishes will come true. But when average
citizens support something, they have next to no influence.
That’s according to a
forthcoming article in Perspectives on Politics by Martin Gilens of
Princeton University and Benjamin I. Page of Northwestern University.
The two looked at a data set of 1,779 policy issues between 1981 and
2002 and matched them up against surveys of public opinion broken down
by income as well as support from interest groups.
They estimate that the
impact of what an average citizen prefers put up against what the
elites and interest groups want is next to nothing, or “a
non-significant, near-zero level.” They note that their findings show
“ordinary citizens…have little or no independent influence on policy at
all.” The affluent, on the other hand, have “a quite substantial,
highly significant, independent impact on policy,” they find, “more so
than any other set of actors” that they studied. Organized interest
groups similarly fare well, with “a large, positive, highly significant
impact on public policy.”
There is more in the
article. What I like about this is that it does get reasonably reported
and is based on "a data
set of 1,779 policy issues between 1981 and 2002": That is a lot of data.
Isn't Torture, Cheney Should Try It
Finally, not an article
but a video of 6 m 32 s by The Young Turks:
This concerns the following,
that I quote from Youtube:
"Sen. Angus King
(I-Maine) said Sunday that former Vice President Dick Cheney should
give waterboarding a try himself if he doesn't believe the
interrogation tactic qualifies as torture.
I think this is entirely fair,
and indeed one of the few things I like about the late Christopher
Hitchens (I don't like former "marxists" who also kept this up for
several decades) is that he also said waterboarding was not torture -
until he agreed to a small bout of it, which immediately converted him
to the position that it is torture.
During a visit to American
University in Washington, D.C. late last month, Cheney said he had no
regrets over the controversial interrogation practices used by the
Central Intelligence Agency during the Bush administration.
"Some people called it
torture. It wasn't torture," Cheney told ATV, the university's
student-run television station, referring to the administration's use
of waterboarding to gather information."
P.S. Apr 14, 2014: I added two links and
corrected a typo.
 Here it is necessary to insist, with
Aristotle, that the governors do not
rule, or at least, should not rule: The laws rule, and the
if good, is part of its executive power. Here I quote Aristotle from my
More on stupidity, the rule of law, and Glenn
It is more proper
that law should govern than any one of the
citizens: upon the same principle, if it is advantageous to place the
supreme power in some particular persons, they should be appointed to
be only guardians, and the servants of the laws.
(And I note the whole file I
from is quite pertinent.)
(that I prefer
to call M.E.: The "/CFS" is added to facilitate search machines) which
is a disease I have since 1.1.1979: