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. Why did Britain’s political
class buy into the Tories’
unending economic crisis makes us feel powerless –
3. Journalist Risen:
'Mercenary Class' Now Permanent
Fixture in National Security
4. Tom Engelhardt Interviews
Laura Poitras on Snowden &
the Total Information Capture
Approach to Surveillance
5. Michael Hudson: Capital
Allocation, Debt, and Stock
This is a Nederlog of Monday, October 20. It is a crisis log.
There are five items with five dotted links: Item 1
is on the Tories' economic fairytales, by someone who teaches economics
at Cambridge; item 2 is on the crisis and concerns
its psychological consequences (which I am a bit more doubtful about); item 3 is a fine interview with James Risen, and item 4 is a fine interview with Laura Poitras, and in
both items I also give some of my own views of the crisis; and item 5 is a good interview with Michael Hudson, who
teaches economy. This is a bit technical, so I don't quote much of it.
As to my own views, some of which are briefly expounded in item 3 and - especially - item 4:
In fact most of the time I spent since June
10, 2013, when I discovered Edward Snowden, was spent on finding
and reviewing articles on the crisis, which contrasts with the earlier
entries I wrote on the crisis from 2008-2013, when I
wrote mostly about what I myself thought, and occasionally also
included rather general statements, notably on December 25, 2012, and on January 16, 2013.
In this Nederlog I give some more of my own position, although
I suppose I will work this out in a little more detail in a later
Here goes for today:
Why did Britain’s political class buy into the Tories’
item is an article by Ha-Joong Chang on The Guardian:
This starts as follows -
and note Ha-Joong Chang teaches economics at the University of
Yes, and it is not only
the UK economy that has been in trouble since the 2008 financial
crisis, but Western economy. Also, I'd like to recall the reader that I
have been saying so since September 1, 2008, and while I am certainly
not the only one who has said so all the time, I am in a fairly small
The UK economy has been
in difficulty since the 2008 financial crisis. Tough spending decisions have been
needed to put it on the path to recovery because of the huge budget
deficit left behind by the last irresponsible Labour government,
showering its supporters with social benefit spending. Thanks to the
coalition holding its nerve amid the clamour against cuts, the economy
has finally recovered. True, wages have yet to make up the lost ground, but it is at
least a “job-rich” recovery, allowing people to stand on their own feet
rather than relying on state handouts.
That is the Conservative party’s narrative on the UK economy, and a
large proportion of the British voting public has bought into it. They
say they trust the Conservatives more than Labour by a big margin when
it comes to economic management. And it’s not just the
voting public. Even the Labour party has come to subscribe to this
narrative and tried to match, if not outdo, the Conservatives in pledging continued austerity. The trouble is that when
you hold it up to the light this narrative is so full of holes it looks
like a piece of Swiss cheese.
As to the holes in the piece of Swiss cheese: Yes indeed - but then
that is also to be expected if, as has been the case, "the arguments"
of the Conservatives were almost wholly propaganda.
You'll have to check out the article to see why some of the arguments
do not work. I pick up the argument further on:
Yes, indeed. Also, this
is pretty standard Keynes, I would say, which itself was pretty
standard capitalism - except that it was capitalism-with-a-human-face,
whereas the Tories wanted capitalism-with-an-inhuman-face, and they got
it, as the article also explains fairly well: Nearly all of the gains
went to the few rich, and most of the jobs that were created were of
very poor quality.
When faced with this,
supporters of the Tory narrative would say, “OK, but however it was
caused, we had to control the deficit because we can’t live beyond our
means and accumulate debt”. This is a pre-modern, quasi-religious view
of debt. Whether debt is a bad thing or not depends on what the money
is used for. After all, the coalition has made students run up huge debts for their
university education on the grounds that their heightened earning
power will make them better off even after they pay back their loans.
The same reasoning should be
applied to government debt. For example, when private sector demand
collapses, as in the 2008 crisis, the government “living beyond its
means” in the short run may actually reduce public debt faster in the
long run, by speeding up economic recovery and thereby more quickly
raising tax revenues and lowering social spending.
Here is the conclusion of the article:
Which means that "Britain will continue on its path of
stagnation, financial instability and social conflict", I'd say.
The success of the
Conservative economic narrative has allowed the coalition to pursue a
destructive and unfair economic strategy, which has generated only a
bogus recovery largely based on government-fuelled asset bubbles in
real estate and finance, with stagnant productivity, falling wages,
millions of people in precarious jobs, and savage welfare cuts.
The country is in
desperate need of a counter narrative that shifts the terms of debate.
A government budget should be understood not just in terms of
bookkeeping but also of demand management, national cohesion and
productivity growth. Jobs and wages should not be seen simply as a
matter of people being “worth” (or not) what they get, but of
better utilising human potential and of providing decent
and dignified livelihoods. Ways have to be found to generate
economic growth based on rising productivity rather than the continuous
blowing of asset bubbles.
Without a new economic
vision incorporating these dimensions, Britain will continue on
its path of stagnation, financial instability and social conflict.
But I also note that the question the title asks did not really get
though I have answered them myself, in outline:
The reasons almost the whole of England's "political class" does
into the Tories' economic fairytale" are mostly the following two.
First, most of the "debate about economics" is not economical
debate but is much simplified propaganda,
that is plugged by the conservative media as if it were fact. Second, most
of the members of the English "political class" know where their own
private real interests are: with the rich, whose propagandistic
fairytales are being plugged by the media.
unending economic crisis makes us feel powerless – and paranoid
item is an article by Paul Mason, who is the economics editor of
Channel 4 News:
This starts as follows -
and in fact is another statement like that in item 1:
Six years into the
economic crisis we can still get days – as with last week’s market correction – where the froth
blows off the recovery and reveals only something flat and stale
beneath. The fundamental economic problems have not been solved:
they’ve just been palliated.
In today’s economy we never
quite seem to turn the corner towards rising growth, falling poverty,
stabilised public finances. Not so much winter without Christmas, but
winter without ever getting to the shortest day. And that is doing
something to our psychology.
It so happens that I
am a psychologist, and not an economist, but I find the present article
more difficult to swallow than the previous one, although I agree more
than not with conclusions like this:
In the face of all this,
the average person learns the true meaning of “inshallah”: the Arabic
phrase denoting resignation to the will of God. We become resigned to
the economy being screwed, resigned to the rich getting richer;
resigned to the fact that all wars end in failure, fiasco or injustice.
And we’re resigned to the possibility that all political heroes –
however noble – will betray us.
But what I agree to
is mostly that ordinary people seem to get resigned and not
if only because diagnosing the psychological state of more than sixty
million people is considerably more difficult than diagnosing their
economy (and namely: because psychology in the end is about what is
inside people's heads, whereas the economy is much more evident).
3. Journalist Risen: 'Mercenary Class'
Now Permanent Fixture in National Security State
item is an article by Andrea Germanos on Common Dreams:
This starts as follows:
Prize-winning New York Times journalist James Risen said
Sunday that the secretive and multi-billion dollar war on terror has
sparked an entire "mercenary class that feeds off unending war."
Yes, indeed. In fact:
Risen, who could
face prison time for refusing to reveal a source, made the remarks
Up With Steve Kornacki.
"Basically, the entire
war on terror has been conducted in secret, and no one in the United
states is allowed to know the full extent of what we've been doing for
13 years," Risen said.
Yes, quite so: What has
been nearly completely deregulated are two very large processes and
institutions, namely the banking system and the security system:
That was the motivation
for his new book, Pay Any Price: Greed, Power, and Endless War,
he said, to show "that the government has used secrecy in order to
allow for ... really a whole string of abuses and bizarre and
unintended consequences to develop. And it shows that really, in my
opinion, that secrecy only leads to abuse by the government and that we
have to have a more open discussion of the war on terror and really
have a more skeptical eye to it if we're going to continue to do this,"
There's essentially been
"a national security crisis, kind of like the banking crisis, where
we've deregulated a large enterprise and poured hundreds of billions of
dollars into it at the same time, and we've done it in secret."
"The government has
stamped 'top secret' on virtually everything," he said.
Although both are funded from tax money and are supposed to work for
the interests of the majority, in fact the deregulated banking system,
in which one can commit major fraud after major fraud and not even be
indicted only works for the rich and the very rich, whereas the
deregulated security system only works for the few who are in
government, but also gives them untold powers.
In both cases deregulation is and was the key: Those profiting from the
banks and the government's security have succeeded in arraigning it so
that they can make enormous profits and they can know everything about
anyone, but at the same time have classified most information on these
processes, which allows them to do mostly what they please.
As to the "mercenary class":
It's a pity this wasn't
worked out more (though one can buy Risen's book): I think he knows
what he is talking about, and it seems he is mostly talking about
politicians and lobbyists, but I would have liked more clarity.
A "whole class of people
began to realize that if you want to make money in the post-9/11 world,
you came to Washington, you called yourself a counter-terrorism expert
and you began to claim that you knew how to find Osama bin Laden or you
knew how to stop al Qaeda."
"We've had this dramatic
increase in a whole mercenary class that is now becoming a permanent
part of a national security state," he said.
4. Tom Engelhardt Interviews Laura Poitras
on Snowden and the Total Information Capture Approach to Surveillance
item is an article by Tom Engelhardt, which is an interview with Laura
Poitras (and his name is spelled "Engelhardt"):
found this on Naked Capitalism, though it originates on
tomdispatch.com. The present version has two introductions, one by Yves
Smith of Naked Capitalism and one by Tom Engelhardt.
First, here is Yves Smith, who makes a point that should be made more
Yves here. This
interview with Laura Poitras is a
reminder of how the world has, and more important, hasn’t changed since
the explosive revelations made by Edward Snowden less than a year and a
half ago. Even though his disclosures produced a great uproar, with
demands in the US, UK, and Europe for explanations and more information
about the nature and range of spying programs, actual changes have been
Yes, indeed: "actual changes have been
few indeed" - the spying on
everyone simply continues, as if stealing private information is legal,
which it isn't, as can be seen from article 12 in the United Nations' Universal Declaration of Human Rights:
And this is from Tom
Engelhardt's introduction, who makes a point about the 98.4% who know
essentially nothing about being spied upon, apart from
from Snowden's revelations, and a point about the new form of
quasi-democracy that has been surrected by both Bush and Obama:
- No one shall be subjected to arbitrary interference
with his privacy, family, home or correspondence, nor to attacks upon
his honour and reputation. Everyone has the right to the protection of
the law against such interference or attacks.
Quite so. And this is why the
United States is not a democracy anymore since 9/11/2001. What
it presently is - a plutocracy, an oligarchy, an inverted
totalitarianism - is less clear, even though it does seem clear what it
will end up as if this continues and does not get ended by a new major
Here’s a Ripley’s Believe
It or Not! stat from our new age
of national security. How many Americans have security clearances? The answer: 5.1 million, a figure that
reflects the explosive growth of the national security state in the
post-9/11 era. Imagine the kind of system needed just to vet that many
people for access to our secret world (to the tune of billions of
dollars). We’re talking here about the total population of
Norway and significantly more people than you can find in Costa Rica,
Ireland, or New Zealand. And yet it’s only about 1.6% of the American
population, while on ever more matters, the unvetted 98.4% of us are
meant to be left in the dark.
For our own safety, of
course. That goes without saying.
All of this offers a new
definition of democracy in which we, the
people, are to know only what the national security state cares to tell
us. Under this system, ignorance is the necessary, legally
enforced prerequisite for feeling protected. In this sense, it is
telling that the only crime for which those inside
the national security state can be held accountable in post-9/11
Washington is not potential perjury before Congress, or the destruction of evidence of a crime,
or torture, or kidnapping, or assassination, or the deaths of prisoners in an
extralegal prison system, but whistleblowing; that is, telling
the American people something about what their government is actually
doing. And that crime, and only that crime, has been prosecuted
to the full extent of the law (and beyond) with a vigor unmatched in American history.
A plutocratic oligarchy, in which a few rich determine everything, and
the large mass of the electorate knows almost nothing about the real
things they are supposed to vote about; who earn very little even if
they work a lot; and who are without any real power. Thus the
situation of the 1800-hundreds will have been remade: a few rich
living in great wealth and determining almost everything, amidst a mass
of 99% effective sub-humans, who earn very little, have no power at
all, and know hardly anything about the real processes that determine
Next, here are a few quotations of Laura Poitras. The first is about
the scope: In effect everyone is subject to the NSA's and the
Five Eyes' illegal spying:
Well - yes and no, and mostly
no, at least for me, who published in October
of 2005 a long Dutch piece on "terrorism" in which I outlined that
neither the war nor the terrorism were essential: what was essential
was the reshaping of politics by "legal" means that were
"justified" by "terrorism", which in fact was there, or at least served
as if it was there, so as to justify these means, that meant much
more power to the rich few and the governments, and much
less powers for the rest.
The most striking thing
Snowden has revealed is the depth of what the NSA and the Five Eyes
countries [Australia, Canada, New Zealand, Great Britain, and the U.S.]
are doing, their hunger for all data, for total bulk dragnet
surveillance where they try to collect all communications and do it all
sorts of different ways. Their ethos is “collect it all.” I worked on a
story with Jim Risen of the New
York Times about a
document — a four-year plan for signals
intelligence — in which they describe the era as being “the golden age
of signals intelligence.” For them, that’s what the Internet is:
the basis for a golden age to spy on everyone.
This focus on bulk, dragnet,
suspicionless surveillance of the planet
is certainly what’s most staggering.
This also means that I think a different picture is more
plausible, which comes to this - and is told especially with reference
to the USA:
Ever since the 1960ies, there was a future possible in which the
government could control and survey the data that ordinary folks
produced and used, and that future was one in which almost every
household ran a personal computer. This was also quite clearly seen and
foreseen by the late 1960ies by persons who were then in the
top U.S. security, and this included, even then, the spying on everyone
that became reality in this Millenium: See Brezezinski.
But until 1981 neither right wing politicians nor security experts
amounted to much: From 1965-1980 were the golden years of the left,
which meant essentially that there were many personal freedoms while
there was a considerable amount of economical sharing of welfare,
especially because of progressive taxation (i.e. the rich pay a higher
percentage in tax than the poor).
In 1971 there also was a secret plan by Lewis Powell
Jr., who tried to bring the right together. This succeeded, also
helped by Reagan, who started to deregulate,
which meant in effect: much enlarging the freedoms of the few rich to
exploit, abuse, and defraud the many poor.
Again that succeeded, and indeed was copied by Bill Clinton and later
Tony Blair, who claimed to be from the third way, which pretended
to be a reconciliation of left-wing and right-wing policies, but in
fact was giving up socialism, trade unions and regulations, while
acting for capitalism, for the rich and for
This succeeded as well, but was not yet enough: Through the 9/11
crisis, which I now think was more probable than not a false flag
operation, that also happened after the Supreme Court had taken the
elections from Gore, who had won, and given them to Bush Jr., the right
wing got its enormous extensions of power by spying on
everyone; got its new war that made very large profits for
American companies and American rich; and also got most of the legal
changes that forced everyone who is not rich into a dependent
position on the rich, which it did mostly by making the 99% a lot
poorer and the 1% a corresponding amount richer, which again was
aggravated by the crisis, especially since Obama and Holder sided with the
banks against the people.
I think that is a considerably more plausible story than many
other stories I've heard, but indeed I agree that, like
everyone else who is not a director of an institution like the NSA,
this is based on informed guessing more than on real knowledge.
(But as I said: Very few have the knowledge.)
Anyway, that was my take.
Here is Poitras on Snowden's influence:
I agree that Snowden has presented us
with choices on how we want to move forward into the future.
We’re at a crossroads and we still don’t quite know which path we’re
going to take. Without Snowden, just about everyone would still
be in the dark about the amount of information the government is
collecting. I think that Snowden has changed consciousness about the
dangers of surveillance.
Yes, I agree, although
it also is uncertain what difference this "changed conscious- ness"
means, especially since the many still are mostly deceived.
Finally, here is Poitras on the failings of the security system as
Again, as I understand
it security was never the end of the National Security Agency (NSA), at
least not since 9/11/2001 and probably also not since the fall of the
Soviet Union in 1989: What the NSA directors wanted, at least since the
death of the Soviet Union, was not security against foreign enemies,
but almost complete control of the U.S. press and of all persons who
might somewhat radically want to deviate from the government's plans in
Snowden and many other people,
including Bill Binney, have said that this mentality — of trying to
suck up everything they can — has left them drowning in information and
so they miss what would be considered more obvious leads. In the
end, the system they’ve created doesn’t lead to what they describe as
their goal, which is security, because they have too much information
I don’t quite know how to
fully understand it.
To end, here is Neil Young's recent "Who's Gonna Stand Up". I
like the classical music - in this version - and the text:
5. Michael Hudson: Capital Allocation,
Debt, and Stock Market
item is an article by Lambert Strether on Naked Capitalism:
In fact, this is an interview on the Real News with
Michael Hudson, who is a distinguished research professor of economics
at the University of Missouri in Kansas City.
I liked the interview, but I agree it is a bit technical, so I only
quote Hudson's view of the present:
What we have is
living on the corpse of the economy that was left in 2008. It’s
basically an economic shrinkage process. There’s no infrastructure
spending. The infrastructure’s aging. There’s little new corporate
industrial investment. That’s stopped. There’s simply services trade in
This is by a professor
of economics on the U.S.
 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
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
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: