28, 2014
Crisis: Reboot Economy, WW I censorship, NYT Pot, Wall Street Democrats
  "They who can give up essential 
   liberty to obtain a little temporary
   safety, deserve neither liberty
   nor safety."
   -- Benjamin Franklin [1]
   "All governments lie and nothing
   they say should be believed.
   -- I.F. Stone
   "Power tends to corrupt, and   
   absolute power corrupts
   absolutely. Great men are        
   almost always bad men."
   -- Lord Acton

Prev- crisis -Next

You Can’t Taper a Ponzi Scheme: Time to Reboot
2. First world war: how state and press kept truth off the
     front page

3. N.Y. Times Editorial Board Goes to Pot
My party has lost its soul: Bill Clinton, Barack Obama and
     the victory of Wall Street Democrats

About ME/CFS


This is the Nederlog of July 28. It is a crisis log.

It is a brief Nederlog because I didn't find much and also because I am quite tired, for a reason I don't know, because I slept fairly well.

Anyway, here are the four items I found.

1. You Can’t Taper a Ponzi Scheme: Time to Reboot

The first item is an article by Ellen Brown on Truthdig (and originally on Web of Debt):
I like Ellen Brown (<- her site) and I like her schema of public banking: This seems a feasible solution to the banking crisis, although it will be hard to implement without a deeper crisis, because most of the current bankmanagers are getting rich from the current corrupt and deregulated banking schema.

Here are several quotes. First, a view of the present state of banking:
All the king’s horses and all the king’s men could not rein in the growth of the shadow banking system, despite the 828-page Dodd-Frank Act. Instead, the derivatives pyramid has continued to explode under its watch, to a notional value now estimated to be as high as $2 quadrillion. At one time, manipulating interest rates was the Fed’s stock in trade for managing the money supply; but that tool too has lost its cutting edge. Rates are now at zero, as low as they can go – unless they go negative, meaning the bank charges the depositor interest rather than the reverse. That desperate idea is actually being discussed.
I don't think banks will charge their customers for giving them money, simply because most will empty their accounts except for the amounts necessary to do business, and I also think an interest rate of 0 is ridiculous, but indeed my bank pays me no interest, since quite some time now, while of course charging large interests on loans. (Happily, I am debt free: I owe no one anything. But this took considerable time and a lot of trouble.)

Next, a reply to the question what will happen, and whether there will be a global economic collapse:

Not likely, argues John Michael Greer in a March 2014 article called “American Delusionalism, or Why History Matters.” If history is any indication, governments will simply, once again, change the rules.

In fact, the rules of money and banking have changed every 20 or 30 years for the past three centuries, in an ongoing trial-and-error experiment in evolving a financial system, and an ongoing battle over whose interests it will serve. To present that timeline in full will take another article, but in a nutshell we have gone from precious metal coins, to government-issued paper scrip, to privately-issued banknotes, to checkbook money, to gold-backed Federal Reserve Notes, to unbacked Federal Reserve Notes, to the “near money” created by the shadow banking system. Money has evolved from being “stored” in the form of a physical commodity, to paper representations of value, to computer bits storing information about credits and debits.

This is all true, but even so in 2008 we narrowly escaped a total collapse. Also, at present enormous amounts of money are invested in banking, and this is effectively a Ponzi-schema, in the sense that only a very small fraction of the debts and loans are recoverable in case of a collapse or a run on the banks.

Finally, here are some ideas to reform the banks:

How to kill the derivatives cancer without killing the patient? Without presuming to have more insight into that question than the head of the Fed or the IMF, I will just list some promising suggestions from a variety of experts in the field (explored in more depth in my earlier article here):

• Eliminate the superpriority granted to derivatives in the 2005 Bankruptcy Reform Act, the highly favorable protective legislation that has allowed the derivatives bubble to mushroom.
• Restore the Glass-Steagall Act separating depository banking from investment banking.
• Break up the giant derivatives banks.
• Alternatively, nationalize the too-big-to-fail banks.
• Make derivatives illegal and unwind them by netting them out, declaring them null and void.
• Impose a financial transactions tax on Wall Street trading.
• To protect the deposits of citizens and local governments, establish postal savings banks and state-owned banks on the model of the Bank of North Dakota, the only state to completely escape the 2008 banking crisis.

These alternatives are all viable possibilities.
Well...yes, presumably. But I must honestly say I do not see any of these measures practised so long as the present banking system is still working (though I agree it is crazy) and the present bank managers are enormously profiting from it.

This is worth reading in full, which you can do by clicking the last dotted link.

2. First world war: how state and press kept truth off the front page

The next item is an article by Roy Greenslade on The Guardian:

It was yesterday a hundred years ago that World War I started. This is an article about WW I, that I review because it contains some information that I did not know, and that shows that there was much more censorship then. This starts as follows:

On this, the 100th anniversary of the day the first world war began [This was published yesterday - MM], it is sobering to look back at the way that conflict was so badly reported. The catalogue of journalistic misdeeds is a matter of record: the willingness to publish propaganda as fact, the apparently tame acceptance of censorship and the failure to hold power to account. But a sweeping condemnation of the press coverage is unjust because journalists, as ever, were prevented from informing the public by three powerful forces – the government, the military and their own proprietors.
Indeed, at the beginning of the war, censorship was instituted thus:
At the war’s outbreak, Kitchener banned reporters from the front. But two determined correspondents, the Daily Chronicle’s Philip Gibbs (pictured)and the Daily Mail’s Basil Clarke, risked his wrath by defying the ban and acting as “journalistic outlaws” to report from the front line. Gibbs was arrested, warned that if he was caught again he would be shot, and sent back to England. Clarke, after reporting on the devastation in Ypres following the German bombardment, returned home after a similar warning.

This had the following effects. First:

(...) censorship ensured that all sorts of facts were hidden from the readers of British newspapers. British blunders went unreported, as did German victories.Even the bloodiest defeat in British history, at the Somme in 1916, in which 600,000 Allied troops were killed, went largely unreported. The battle’s disastrous first day was reported as a victory.

And second:

(..) Lloyd George confided to Scott in December 1917: “If people really knew [the truth], the war would be stopped tomorrow. But of course they don’t know, and can’t know.”

So in fact the truth - the horrors of trench warfare, 37 million persons killed (a rough estimate: no one knows the precise numbers) - only became known, and that only partially, after WW I.

The main reason for me to list this is that, while I did read a fair amount about WW I, I was not made aware of the extent and general success of censorship, which itself is a sign of its success.

3. N.Y. Times Editorial Board Goes to Pot 

The next item is by Kasia Anderson on Truthdig:

This article starts as follows:

The editorial board of The New York Times has weighed in with its collective take on decriminalizing marijuana use, and it can be summed up with two familiar words: Legalize it.

Of course, the Gray Lady’s writerly brain trust put it more eloquently, but the gist is that it’s, well, high time that the national ban Congress imposed, more than four decades ago, on lighting up is lifted, and that it’s up to the individual states to figure out how they want to handle the issue for themselves.

I say. It is high time.

For one thing, there was a report by a British parliamentary committee, the Wootton Report, that proposed legalizing it in 1968 or 1969, for one example, all on perfectly rational grounds, or so I thought in 1969 when I attended a large meeting in Amsterdam dedicated to it.

Indeed, I expected it to be legalized then quite soon, in 1969, but no: All of this was mostly undone and denied by loads of blatantly false propaganda, that few Dutchmen believed, but which was presented as Gospel Truth by the Dutch politicians, even while most of them simultaneously furthered the dealing of soft drugs in Holland, which still is illegal, but which also is extremely profitable, and which is freely available at very many public places generally known as "coffee shops", indeed without causing any known harm to users. The drugs are dealt in the shops quite publicly by dealers who got personal permission of their mayors to deal.

Yet again, even in the years between 2000 and 2010 Dutch policemen were sent to the U.S. to learn about "the great dangers of marijuana" and the excellencies of the "War on Drugs", while the mayors and aldermen of Amsterdam and other places, like all the Dutch judges, all the Dutch policemen, and the whole Dutch bureaucracy simply protected the dealers, who turned over at least 10 billions of dollars of soft drugs (including large exports) each year.

I think this happened for a percentage for the mayors, aldermen and policemen, but this is based on my extensive experience of Dutch greed, dishonesty and duplicity, and not on specific knowledge: In the last 25 years at least 10 billion dollars a year have been turned over - according to a Parliamentary Report: here is a Dutch note on the amounts - merely in soft drugs in Holland, and who believes that Dutch mayors who have to give their personal permission to deal do not get a percentage, somehow, has more trust in people than I have, and less relevant knowledge. (See ME in Amsterdam if you read Dutch, and especially my Notes to the Van Traa-report)

But I welcome legalization, though I would not be amazed if the Dutch legalize it last: Too many politicians have profited from it and profit from it, in my opinion.

Also, this is one of the things which the last 25 years have never been discussed seriously in any Dutch political organ or any Dutch paper, except for a brief bit in 1996-1997, when an extensive Parliamentary Report (<- link) was published, but ever since its main author came to die in what the police claimed was "an accident" there has been mostly silence in Holland, and a lot of dealing, all permitted by the mayors and aldermen and judges and politicians, and not because they were enlightened, but because they profited, or so I think. (But it is impossible to get the truth on the dealing in illegal drugs on the table in Holland: I tried and failed.)

4. My party has lost its soul: Bill Clinton, Barack Obama and the victory of Wall Street Democrats

The next item is an article by Bill Curry on Salon:

This is a long essay by a former counselor to Bill Clinton. I think it is too political for my tastes, but it is against Obama and Clinton, pro Nader, and also pro populism (in some sense: I am not sure about the meanings of "populism" in the United States, where many political terms have different meanings from those they have in Europe).

I quote three things from it. First, a sketch of what caused the crisis:
In the late ’70s, deregulation fever swept the nation. Carter deregulated trucks and airlines; Reagan broke up Ma Bell, ending real oversight of phone companies. But those forays paled next to the assaults of the late ’90s. The Telecommunications Act of 1996 had solid Democratic backing as did the Financial Services Modernization Act of 1999. The communications bill authorized a massive giveaway of public airwaves to big business and ended the ban on cross ownership of media. The resultant concentration of ownership hastened the rise of hate radio and demise of local news and public affairs programming across America. As for the “modernization” of financial services, suffice to say its effect proved even more devastating. Clinton signed and still defends both bills with seeming enthusiasm.

The Telecommunications Act subverted anti-trust principles traceable to Wilson. The financial services bill gutted Glass-Steagall, FDR’s historic banking reform. You’d think such reversals would spark intra-party debate but Democrats made barely a peep.
I think that is mostly correct, also in identifying deregulation as the main idea and the main policy that did the most harm, and this really started under Reagan and Clinton.

Second, what the deregulations led to:

We’re in crisis because of all our broken systems; because we still let big banks prey on homeowners, students, consumers and retailers; because our infrastructure is decrepit; because our tax code breeds inefficiency and inequality; because foreign interventions bled us dry. We’re in peril because our democracy is dying. Reviving it will take more than deficit spending and easy money. It will take reform, and before that, a whole new political debate.
This also seems mostly correct to me, and maybe Curry believes he or Ralph Nader started "a whole new political debate": Perhaps they did, but I don't know.

Third, another factor is Obama, who turned out to be a Republican Lite, with a large talent for lying charmingly:

To blame Republicans ignores a glaring truth: Obama’s record is worst where they had little or no role to play. It wasn’t Republicans who prosecuted all those whistle-blowers and hired all those lobbyists; who authorized drone strikes or kept the NSA chugging along; who reneged on the public option, the minimum wage and aid to homeowners. It wasn’t even Republicans who turned a blind eye to Wall Street corruption and excessive executive compensation. It was Obama.
Again mostly correct, in my vision. There is a lot more, that I have all read, but it is, as I said, too political for my tastes - but then those are just my tastes, and this also is a fairly rare Democratic voice that starts talking some sense.


[1] 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 government, if good, is part of its executive power. Here I quote Aristotle from my More on stupidity, the rule of law, and Glenn Greenwald:
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 quote from is quite pertinent.)

About ME/CFS (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:
1. Anthony Komaroff

Ten discoveries about the biology of CFS(pdf)

3. Hillary Johnson

The Why  (currently not available)

4. Consensus (many M.D.s) Canadian Consensus Government Report on ME (pdf - version 2003)
5. Consensus (many M.D.s) Canadian Consensus Government Report on ME (pdf - version 2011)
6. Eleanor Stein

Clinical Guidelines for Psychiatrists (pdf)

7. William Clifford The Ethics of Belief
8. Malcolm Hooper Magical Medicine (pdf)
Maarten Maartensz
Resources about ME/CFS
(more resources, by many)

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Crisis: Reboot Economy, WW I censorship, NYT Pot, Wall Street Democrats