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Nederlog

Aug 2, 2016

Crisis: Scheer on Clinton, Reich, Germany & Terrorism, Economic Crash
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Introduction

1.
The Convention Film on Hillary Clinton Lied to America
2. The Real Reckoning
3. A Country on Tenterhooks: Germans Wonder If Terror
     Can Be Prevented

4. Signs of the Coming Economic Crash

Introduction:

This is a Nederlog of Tuesday, August 2, 2016.

This is a crisis log. There are 4 items with 4 dotted links: Item 1 is about an article on Clinton by Robert Scheer; item 2 is about an article by Robert Reich; item 3 is about a Spiegel article (that I didn't much like); and item 4 is about a Thom Hartmann article about the coming economic crash (that was also not very good).

Also I updated the last
crisis index (there are six more) that now includes January up to and including July of 2016. [1]

1.
The Convention Film on Hillary Clinton Lied to America

The first item today is by Robert Scheer on Truthdig:

This starts as follows:

The title of the film about Hillary Clinton that actor Morgan Freeman narrated at the Democratic National Convention should have been “Escape From Accountability.” Of course, the same could be said—far more so (a pathetic comfort)—of the GOP convention propaganda depicting Donald Trump’s ascension to power. What we have in this election is a race to the bottom in what once was regarded as adult behavior, meaning that one should take responsibility for one’s actions.

But while the deep venality of Trump’s record should be obvious to anyone old enough to read, that is not the case with his opponent, safely ensconced as the very much lesser evil. Now that America’s version of Margaret Thatcher is poised to become president, the obvious value of breaking that glass ceiling has to be tempered by the prospect of increased belligerence in foreign policy and a Wall Street-manipulated, heartless economy at home.

I more or less agree with this, but then I also have said for quite a long time now that I appreciated the - then - three candidates as follows:

Bernie Sanders >> Hillary Clinton >> Donald Trump
Here ">>" means "is much better than", while I also have made it quite clear that I only regarded Bernie Sanders as a good, decent and honest candidate, and regarded the other two mostly as representing the rich, and as bad and - in various degrees - indecent and dishonest candidates.

And now that the choice has been diminished to two candidates, it simply is a fact that, from my point of view (that I share with quite a few), the choice is
between a bad pro-rich candidate (Hillary Clinton) and a horrible and mad pro-rich candidate (Donald Trump).

Then again, while I like none of these choices, I dislike Donald Trump far more than Hillary Clinton, and I agree with John Kenneth Galbraith that much of politics consists of this:
"Politics is the art of choosing between the disastrous and the unpalatable."

And since this is quite clearly a choice between the disastrous Trump and the unpalatable Clinton, from my own point of view the choice is easy: Clinton, indeed while holding my nose.

As to holding my nose, there is this:

For all of the Democrats’ denunciation of Citizens United and the role of big money, that is what saved Clinton in this campaign, and the fat cats toasting over at the Ritz-Carlton were delighted with the outcome. It is the Democrats, first Barack Obama and now Clinton, who turned their backs on public financing because, thanks to their sellout to Wall Street, they can look to big money to smash populist sentiment, as expressed so dramatically this time by the incredible outpouring of small contributions that financed the Bernie Sanders campaign.

Yes and no: I agree both Barack Obama and Hillary Clinton served the rich, and I agree that is bad, but then again they merely continued the public policies that were started under Thatcher and Reagan, and that consisted in ever further deregulations, which meant that the many non-rich got less and less and less economical powers, while the few rich got more and more and more economical powers, and now run the economy through direct personal participation in the government (inbetween positions as bank managers).

This has happened over the course of the last 36 years, and it will be extremely difficult to undo, simply because the many deregulations systematically helped the few rich, and consisted in removing one legal restraint on exploiting and abusing the many non-rich by the rich after another.

And I agree that the following sketches the very probable course of a Hillary Clinton presidency:

There is no doubt that this Clinton will continue the course of her husband, who accomplished for Wall Street what Ronald Reagan could not by gleefully signing the reversal of the Glass-Steagall Act, giving Wall Street unfettered power to amass greater and greater profits at a devastating cost to the middle class, costing jobs, homes, life savings—most severely among blacks and Latinos—and any sense of security.

The article ends as follows:

Undoubtedly, readers troubled by this column will quickly produce quotes establishing that Trump wants to hurt poor children far more barbarically. But if that’s enough to float your boat as you hold your nose for Clinton, know that that is a truly depressing choice for the country.

USA? USA?

I agree it is a very sad choice, and indeed I also agree that much of the USA has been killed since Reagan, and has been killed, quite intentionally, as a reward for the money they got from the few rich, by leading politicians of both leading parties.

But as I said before: Given that the choice is between two bad candidates, anybody who is neither a stupid or ignorant fool nor a neofascist or a neoliberal should know whom he has to choose: Clinton, because the alternative is voting for insanity.

2. The Real Reckoning

The second item is by Robert Reich on his site:

This starts as follows:

In her speech accepting the Democratic nomination, Hillary Clinton said the nation was at “a moment of reckoning.”

She’s right, but the reckoning is not simply the choice voters face this fall between her and Donald Trump. The real reckoning is larger and it will extend beyond Election Day.

Yet Washington insiders expect a return to politics as usual.

I’m already hearing Republicans dismiss Donald Trump as a weird aberration. “Ordinarily, Trump wouldn’t have stood a chance,” a Republican operative told me. “He won because he didn’t have a clear opponent until the very end. And Cruz is almost as crazy as Trump."

I get a similar story from Democrats trying to explain Bernie Sanders. “His campaign was a freak,” a longtime Democratic adviser told me. “Hillary will be elected and then Washington will go on as if nothing happened.”

As has been pointed out in Nederlog - see here - one main reason why the choice for a presidential candidate "will extend beyond Election Day" is that the next president probably will have to propose four Supreme Court judges, who will have a lot of influence the coming twentyfive years or so.

I do not know whether Reich had that in mind, but it is quite important.

As to the Republicans and the Democrats Reich has been listening to:

He can listen to whom he pleases, but most important members of most political parties can be trusted to always propagandize for their parties,
and the above two lines appear to be the current propaganda. (I don't take
it seriously.)

Then there is this:

But Donald Trump isn’t just an aberration and Bernie Sanders wasn’t just a flash in the pan. Both, in very different ways, reflect a crisis in our political economy.
(...)
It’s the rigging of our economy – the increasingly tight nexus between wealth and political power. Big money has been buying political clout to get laws and regulations that make big money even bigger.

Yes and yes - but this "rigging of our economy – the increasingly tight nexus between wealth and political power" has been going on for 36 years now, and
it simply has succeeded, as is also shown by the fact that both candidates of both parties stand basically for the rich, albeit not in the same ways.

Here is a fairly long list of the things "business as usual in Washington" means in Reich's views:

She’s correct, but she didn’t finish the logic. Democracy is not working the way it should because it’s being corrupted by big money. That big money is altering the rules of the game to generate even bigger money.

Americans now pay more for pharmaceuticals than the citizens of any other advanced nation because Big Pharma is setting the rules – extending the life of drug patents, prohibiting Medicare from using its bargaining power to get lower drug prices, and blocking consumers from buying cheaper drugs from Canada.

We pay more for Internet service, health insurance, airline tickets, and banking services because the increasing market power of key players in these industries lets them raise prices. Antitrust enforcement has been systematically weakened.

The biggest Wall Street banks continue to reap the financial benefits of being too big to fail. Hedge-fund partners make bundles from confidential information, trading on which used to be illegal.

CEOs cash in their stock options and grants just when they pump up the value of their company’s stocks with buybacks. It’s allowed because laws and regulations have been loosened.

Trade agreements are now designed to protect the intellectual property and foreign assets of giant corporations, but nothing is done to protect the incomes of Americans who lose their jobs to foreign competition.

This is business as usual in Washington.
I agree, but then these are just the facts, and I do not think they can be fundamentally changed at this point: One has to choose from two bad candidates both of whom are pro rich, and both of whom will follow policies
that - once again - mostly favor the rich.

This could have been prevented if Bernie Sanders had won the presidential candidacy of the Democrats, but he didn't. And I can end this review in precisely the same terms as the previous one:

Given that the choice is between two bad candidates, anybody who is neither a stupid or ignorant fool nor a neofascist or a neoliberal should know whom he has to choose: Clinton, because the alternative is voting for insanity.

3. A Country on Tenterhooks: Germans Wonder If Terror Can Be Prevented

The third item is by Spiegel Staff on Spiegel International:

This is from near the beginning:

Munich is in shock. As the city mourns, local politicians are seeking to reassure people -- to little avail. A ban on backpacks and a perimeter fence around the Oktoberfest grounds could make the event safer, said Josef Schmid, the head of the annual event. But that "wouldn't be an ideal solution," retorted Munich Mayor Dieter Reiter, who added that a possible attacker could simply blow himself up among the crowds waiting in front of the entrance.

Really now? I think this is fairly hysterical prose that will only make things worse, simply because there still is not much of a chance that ordinary people
will get killed by terrorists: it is still considerably lower than being hit by lightning or dying in a traffic accident.

But the Spiegel Staff does not point that out. Instead, they continue as follows:

Can anyone blame them? Last year, 2015, was already full of horrors. The fact that this year wasn't likely to be any more peaceful became clear early on when authorities received a tip about a potential terrorist attack in Munich on New Year's Eve. It turned out to be a false alarm, but then came July, a month so full of calamities and horrific scenes it seemed worthy of a Hieronymous Bosch painting.
So this paragraph starts with being "full of horrors", continues with "a potential terroristic attack", and ends with "a month so full of calamities and horrific scenes it seemed worthy of a Hieronymous Bosch painting" (which makes me wonder - among other things - whether any Spiegel writer has ever seen a Hieronymous Bosch painting).

And this paragraph gets continued with a dotted list on which there are attacks in Germany, attacks in France, attacks in the USA, and attacks in Japan (as if anyone reading it runs the cumulative risk), without anything being said to relativize these "
calamities and horrific scenes" in any way e.g. by pointing out that it still is the case that in each of these countries far more people get killed every day by ordinary accidents.

Here is the last quotation I have from this - rather long - article:

People are never far from these horrors as news of them is broadcast live on their smartphones. The distant countries of France, Japan, the United States and Germany blur together into a single, pixelated image of terror.

Even while forensic experts are still analyzing blood samples and investigators are putting together the pieces of the puzzle, users on social media waste no time sharing their convictions that every single attack is the work of terrorists. For many, every crime of passion, every shooting spree, every bloodbath and every meticulously planned attack by fanatics can only be one thing: terrorism. More specifically: Islamic terrorism.

This is how fear seeps into peoples' heads.

I am sorry, but it seems to me that the Spiegel Staff simply is contributing to the horrors and the panic and does little to stem it (they do so a little at the end, I grant).

4. Signs of the Coming Economic Crash

The fourth and last item today is by The Thom Hartmann Program on Truth-out:

This starts as follows:

Eight years after the worst financial crisis since the Great Depression, the economy is doing much better in many important ways.

We have now seen almost 80 straight months of job growth, unemployment is down below 5 percent and some numbers suggest that wages are ticking upwards, however slowly.

But make no mistake: The next crash is coming.

It's not a question of "if." It's a question of "when."

And that's because the underlying cause of the 2008 crisis is still with us today -- the economy is too financialized.

I partially agree: I think it is indeed very likely that "[t]he next crash is coming", although I don't know when, and I agree that part of the reason is that "the economy is too financialized" - although that sounds extremely careful, after a mere 36 years of successive deregulation after deregulation, each of which made the rich richer and more powerful, and the non-rich poorer and less powerful.

This is also why I disagree with the statement that "the economy is doing much better in many important ways", for it seems to me that this is indeed true for the few rich, but is mostly false for the many non-rich (and it also seems to me that the "job growth" and "unemployment" figures are mani- pulated, but I merely remark that here - and incidentally, here is I.F. Stone: "All governments lie and nothing they say should be believed").

Next, there is this:

Giving banks this kind of powerful role to play in the economy is just asking for trouble. Wall Street is literally a ticking time bomb, and when it explodes it will take the rest of the economy down with it.

This is not hyperbole -- it's fact, and we're seeing more and more evidence every day that the moment when the Wall Street time bomb will explode is rapidly approaching.

As Greg Ip points out in the Wall Street Journal, housing prices and stock prices are now hovering around decades-long highs.

The last time they were this high?

You guessed it: 2007, right before crash.

I agree on Wall Street, but the rest may be a mere coincidence. And the last bit I'll quote simply seems extremely optimistic to me:

Ironically, 2008's failure could be 2016's success.

Because we didn't completely overhaul the economy last time around, the crash of 2016 is probably going to be a lot worse than the crash of 2008.

Things will be bad for a bit, but if the crash is as disastrous as it's likely going to be, that also opens up opportunities for big change.

Once people realize the dysfunction that governs our economy, they'll fight back, just as they did in the 1930s during the New Deal.

First, it's not true that (bolding added) "we didn't completely overhaul the economy last time around": "we" - if we are not bank managers or governors - have nothing to do with "overhauling the economy"; second, it's not true that (bolding added) "we didn't completely overhaul the economy last time around": in fact the economy was not overhauled at all, and was instead mostly delivered to the bank managers (who are "too big to fail"); and third, I have seen no evidence (other than what well may be a coincidence) that there will be a "crash of 2016".

Also, I think that to say that "[t]hings will be bad for a bit (..) if the crash is as disastrous as it's likely going to be" is remarkably light hearted.

Consider the Great Depression (<- Wikipedia). Here is some from the start of that item:

Between 1929 and 1932, worldwide GDP fell by an estimated 15%. By comparison, worldwide GDP fell by less than 1% from 2008 to 2009 during the Great Recession.
(...)
The Great Depression had devastating effects in countries both rich and poor. Personal income, tax revenue, profits and prices dropped, while international trade plunged by more than 50%. Unemployment in the U.S. rose to 25% and in some countries rose as high as 33%.

I do not look forward to times like the Great Depression, although (i) it seems fairly likely to me that the next crisis may well be as bad or worse and (ii) I agree it is likely that there will be another crash, probably quite soon, and that
simply because Obama did not tame the banks in 2009-2010, but instead gave
them more powers than they had before.

But we will see.

---------------
Note
[1] The crisis index has been monthly updated this year. I have to do it this way (and still have to remove many duplicated font codes in my html) because that is the only way this works with KompoZer, which is the only WYSIWYG html editor that is available on Ubuntu.
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