Thursday, December 24, 2009

2009: The Year in Review

It has been another difficult year for the working class. While the top wealth owners consolidated ownership, the working class saw declines in wages and employment. The gap between rich and poor continued on its 40-year path towards greater disparity. The US health care bill, which appears to be close to passing, grants greater power for the powerful medical-industrial complex. The US also continues to be involved in military occupations in Iraq and an escalation of violence in Afghanistan. The drawing above, from 1911, reflects the hegemony of capitalism which is still visible nearly a century later.

Saturday, November 14, 2009

Goldman Sachs and the War on the Working Class

Goldman Sachs (GS) continues to consolidate power on several fronts, by pushing working-class people out of their homes, and by sending a 29 year-old former executive to the Securities and Exchange Commission (SEC) as another major player in the US government.

In 2006 GS sold $2 Billion in bonds to European investors through a Cayman Islands shell corporation, Altius III Funding Ltd. The bonds were bundled real estate and student loans made to appear as safe investments. Shell corporations such as Altius have been used to avoid taxes and oversight. From 2006 to 2007, GS sold more than $57 Billion in high-risk mortgage-based securities packaged as low risk bonds. The corporation, however, was left holding billions more in mortgage loans.1

With billions in toxic real estate investments remaining, another GS subsidiary, MTGLQ, is now removing people from their homes without negotiating substantively with homeowners.2

On October 16th, Former GS executive Adam Storch, a former Vice President at GS has been appointed Chief Operating Officer of the SEC's Enforcement Division. Former GS CEO Henry Paulson was the US Treasury Secretary from 2006 to 2008 when the US economy began its dramatic downturn.3


Friday, October 23, 2009

Frontline Episode Shows How Neoliberals Enabled Economic Collapse

Frontline's latest episode called "The Warning" presents information on the history of over-the-counter credit derivatives and Brooksley Born, the head of the CFTC who cautioned that these unregulated financial instruments (over-the-counter derivatives) created a major risk for the economic markets. According to the Frontline sources, Alan Greenspan reportedly said he did not favor prosecution of fraud in this market that grew to $596 Trillion in derivatives. When Born decided to prosecute anyway, she was marginalized by FED Chairman Greenspan and Clinton Treasury officials Robert Rubin and Larry Summers. The episode also notes that Timothy Geitner, now the US Treasury Secretary, was also part of the male-dominated neoliberal contingent.


Friday, October 16, 2009

Banks Continue Assault on Working Class

The working class continues to be assaulted on several fronts. While many of its sons and daughters are pawns in the economic draft for US imperialism, working class people have also faced a chronic economic malaise. Law professor Elizabeth Warren notes, the middle-class have been hollowed out:

"So you've got, effectively, flat income in this time period with rising core expenses; housing; health insurance; child care; transportation, now that it takes two cars to get everywhere, two jobs to support; and taxes, because you've got two people in the workforce and we have a somewhat progressive taxation system. So that families are spending a lot more on what you describe as the basic nut."1

As Warren notes, the neo-liberal elite have been bailed out while the working class face greater vulnerability. As my time line indicates, this war on the working class has been systemic and lengthy. Sometimes the injuries are from a thousand cuts, such as the recent plan of Bank of America and Citigroup to begin charging annual fees to customers who pay off their credit card balances each month.2



Sunday, October 11, 2009

US Empire Engaged in Murder Suicide

The US continues to occupy Afghanistan, with no exit strategy and no final objective. Historians note that the area is littered with the remains of the Macedonian, Mogul, British and Soviet empires who suffered great losses in their occupations. MSNBC reports that a significant majority of the warriors are not "Taliban", but a variety of recruits from the area and elsewhere (Chechnya, North Africa, Pakistan) sympathetic to the cause of pushing out the US Empire.1

In the meantime, US and NATO occupying soldiers are caught in the dilemma of killing civilians or facing death themselves as they help support corrupt governments there and in the US. To make matters worse, the US occupation exists between India and Pakistan, two nuclear rivals.3

According to former NATO Commander General Dan McNeill, 400,000 troops would be necessary to control Afghanistan. Others estimate that a much larger force, perhaps 660,000 troops, would be needed to secure the area.2 Currently there are about 100,000 US and NATO soldiers there and the Afghan military consists of about 190,000 soldiers. Canada plans on removing its 7500 troops by 2011.4


Saturday, October 10, 2009

From Phantom Wealth to Real Wealth

Rep Marcy Kaptur Urges Working-Class People to Stay in their Homes

Is non-violent resistance necessary to enable democracy in the US? Bill Moyers interviews Ohio Representative Marcy Kaptur, a brave woman who has told her constituents to squat in their foreclosed homes. Banks such as Wells Fargo, BOA, and JP Morgan Chase continue to prey on working-class people as the housing crisis continues. In the Moyers interview, Rep Kaptur also says that Tim Geitner and Larry Summers are incapable of creating the changes necessary to fix the system and that President Obama needs to replace these shills for the banking industry.


Saturday, October 3, 2009

Elites' Solution for Working-Class Medical Care: Don't Get Sick

US Congressman Alan Grayson has apologized to the 45,000 or so Americans and their families who die prematurely due to lack of medical care. It appears that the US will continue to be perhaps the worst post-industrial nation in terms of health care--and yet the most expensive. The biggest winner in this neoliberal lottery appears to be the insurance companies, who either maintain the status quo of overcharging and rescission or profit from an additional 30 to 40 million customers if the health care bill passes.

Friday, October 2, 2009

US Police Use Sound Cannons to Silence Democratic Protests

Police in Pittsburgh, Pennsylvania assaulted protesters with sound cannons during the latest G-20 meeting.* This was the first time that the weapons have been used against US civilians. According to Democracy Now, the weapon, known as a Long-Range Acoustic Device (LRAD) is manufactured by American Technology Corporation of San Diego. The device was used at 144 decibels which has as much sound pressure as an improvised explosive device. Quoting the Washington Times, Amy Goodman added:

“With the help of Homeland Security grants, police departments nationwide looking to subdue unruly crowds and political protesters are purchasing a high-tech device originally used by the military to repel battlefield insurgents and Somali pirates with piercing noise."

*Please see the 12-30-08 entry on US military preparation to use force against domestic resistance.

Sunday, September 6, 2009

Monopoly Capitalism in Medical Care

In 1945, Senator Pat McCarran (NV) sponsored a bill giving insurance companies an exemption from Federal anti-trust laws. The McCarran-Ferguson Act gave states the right to regulate insurance; in reality it allowed insurance companies the power the fix prices and deny care to its customers with limited repercussions. Today, health insurance companies make billions of dollars through monopoly capitalism and denying care to its sick customers through rescision.

Thursday, September 3, 2009

American Casino

American Casino is a new movie detailing the mortgage and foreclosure crisis that were part of the latest world economic downturn. The movie explains, for example, that corporations like Wells Fargo pushed working class people into subprime loans because they had significantly higher profit margins. These loans disproportionately affected people of color, including many who could have been eligible for more conservative fixed rate mortgages. This latest crisis, however, is only one event in the much longer war against the US working class. The evidence from my timeline is compelling--a pattern of corporate and government actions to extract more from workers.

Wednesday, July 29, 2009

Christopher Pyle discusses current domestic spying on peace activists by the US military. His discussion (starting at about minute 41) on Democracy Now! mentions US military spying of religious groups such as Unitarians and Quakers. Pyle was a whistleblower in 1970, revealing an extensive system of domestic spies under the code name Operation Talon.

Monday, July 13, 2009

Stella D'Oro Workers Win Battle Against Private Equity Pirates

Employees at Stella D'Oro biscuit company returned to work after striking for 11 months. The National Labor Relations Board (NLRB) determined that the private equity firm that owned the factory, Brenwood Partners, refused to bargain in good faith. The workers, members of Bakery, Confectionery, Tobacco Workers and Grain Millers Union, were forced on strike after Brenwood Partners tried to force them to take "a 20% pay cut, elimination of sick days and overtime, reductions in vacations and holidays and an increase in employee health care contributions." The firm stated that wages and benefits made the company unprofitable, yet failed to provide evidence of their claim. They are now threatening to close the factory. Private equity firms like Brenwood are known for making 30% returns on investment, in large part by reducing workers' wages and benefits. Employees had labored at Stella D'Oro for 10-15 years or more for the formerly family-owned operation.

Wednesday, June 3, 2009

Single-Payer Health Care Would Save Millions of Jobs and Thousands of Working-Class Lives Per Year

Dr. Carol Paris was one of 13 people arrested for protesting for single-payer health care on the US Senate floor. HMOs, pharmaceutical corporations, and for-profit hospital corporations spend billions of dollars funding US politicians to maintain the status quo, which means millions of personal bankruptcies and jobs lost and tens of thousands prematurely dead.

The US has possibly the worst health care system in the post-industrial world. Approximately 50 million US inhabitants do not have medical insurance and 45,000 die each year due to lack of medical care.1,2 Not only are health outcomes poor, they are expensive. The U.S. spends twice as much as comparable nations on health care, $7,129 per person, while half of all people who experience personal bankruptcy, a number in the millions, do so because of medical bills.3

The US medical system ruins workers who are well in addition to those who become sick or injured. "A 20% increase in [medical insurance] premiums costs 3.5 million workers their jobs, causes millions more to move from full-time to part-time work, and cuts the average income by approximately $1,700. CBO [the Congressional Budget Office] predicts that this 20% increase will occur over the next four years."4

One cure for this health care crisis would be single-payer health care, which would cut out high-cost medical insurance companies.

According to Nobel Laureate Paul Krugman:

"The great advantage of universal, government-provided health insurance is lower costs. Canada’s government-run insurance system has much less bureaucracy and much lower administrative costs than our largely private system. Medicare has much lower administrative costs than private insurance. The reason is that single-payer systems don’t devote large resources to screening out high-risk clients or charging them higher fees. The savings from a single-payer system would probably exceed $200 billion a year, far more than the cost of covering all of those now uninsured."4


Sunday, May 17, 2009

Understanding the History of Capitalism

The current global recession has been viewed by some neoliberal economists as an aberration in the history of capitalism. However, when one looks at economic history, particularly in the US, it becomes apparent that downturns are part of how the system operates. In fact, economic downturns account for more than a half century of US capitalism. For the elites, this latest event continues to be an opportunity to consolidate power and wealth.1

US Recessions

Feb-Oct 1945
Nov 1948–Oct 1949
July 1953–May 1954
Aug 1957–April 1958
April 1960–Feb 1961
Dec 1969–Nov 1970
Nov. 1973– March 1975
Jan-July 1980
July 1981–Nov 1982
July 1990–March 1991
Mar-Nov 2001
Dec 2007-current

In reality, the economic downturn for many began in the 1960s. The US Gini Index (a measure of income inequality) began increasing in the US no later than 1970:

1929: 45.0
1947: 37.6
1967: 39.7
1968: 38.6
1970: 39.4
1980: 40.3
1990: 42.8
2000: 46.2
2005: 46.9
2006: 47.0
2007: 46.3


Saturday, May 9, 2009

US Senate Votes to Walk Away from Working-Class People

This week the US Senate voted to deny judges the ability to adjust home mortgages in foreclosure. The Durbin Amendment, strongly opposed by the banking industry, would have given up to 1,700,000 working-class people the chance to stay in their homes. One part of the bill that passed was a "safe harbor" provision that would reduce liability for predatory and fraudulent lenders.

As Clarence Darrow remarked, "the law does not pretend to punish everything that is dishonest. That would seriously interfere with business."

Friday, April 3, 2009

More From the US Kleptocracy

On Bill Moyers' Journal, William K. Black explains how a US banking culture of fraud led to the current economic crisis. The transcript is at

Earlier this week, the Financial Accounting Standards Board (FASB) relaxed Mark to Market accounting procedures which will ensure more corporate fraud in the future.

Sunday, March 1, 2009

Corporations Work Overtime to Subvert Workers

US corporations are spending billions of dollars to ensure that workers do not gain more rights and safeguards. The following links explain this battle against the Employee Free Choice Act.

Saturday, January 24, 2009

US Banks Functioning as Economic Parasites

Although it hasn't made mainstream news, economist Michael Hudson states that most of the US' top banks (Citibank, Bank of America, JP Morgan Chase, Wells Fargo) are insolvent. Hudson states that the current US bank bailout only prolongs the life of these toxic and parasitic banks. A historical analysis of this situation is at Counterpunch.