The New Age of 'Elites', 'Robber Barons' and 'Social Darwinists'

by Len Hart, The Existentialist Cowboy

Darwinism is correct. Social Darwinism is utter bunkum. Not surprisingly, the American right-wing despises Darwinism but, inexplicably, embraces Social Darwinism with messianic ferver.

Social Darwinism is at the very root of an impending economic collapse but it won't be the best or brightest who emerge unscathed on the other side! Social Darwinism is the survival of the most ruthless. Real Darwinism is reviled because it disproves the lies the rich tell themselves to help them sleep at night.

The right wing benefits when issues are obscured and when enough dust is kicked up by "intelligent design" to obscure the real issues and various strawmen to boot.

Simply, Social Darwinism does not follow from "Darwinism" and, worse, it attributes to Darwin positions he never took. The term "survival of the fittest" was never used by Darwin. It has been variously attributed, but Hofstadter traces the phrase to 19th Century American robber barons, rail road men making fortunes connecting one coast with another.

Railroad executive Chauncy Depew asserted that the guests of the great dinners and public banquets of New York City represented the survival of the fittest of all who came in search of fortune. They were the ones with superior abilities. Likewise railroad magnate James J. Hill defended the railroad companies by saying their fortunes were determined according to the law of survival of the fittest.

—Hofstadter, Richard; 1959; Social Darwinism in American Thought, Braziller; New York.

These were most certainly the 'robber barons' who wished to be photographed wearing laurel wreaths, pretending to be emperors.

Elsewhere, the term is attributed to Herbert Spencer who inspired a generation of radicalized, latter-day robber barons. Few of them evinced the "...quality of mercy" so immortalized with but a few words by Shakespeare --'The quality of mercy is not strain'd, It droppeth as the gentle rain from heaven". By contrast ...

[Herbert] Spencer said that diseases "are among the penalties Nature has attached to ignorance and imbecility, and should not, therefore, be tampered with." He even faulted private organizations like the National Society for the Prevention of Cruelty to Children because they encouraged legislation.

—Social Darwinism and American Laissez-faire Capitalism

A fallacious corollary to "Social Darwinism" is often phrased this way: the rich are rich because they are better, work harder and are more intelligent. George W. Bush put it more crudely: “The poor are poor because they are lazy!” So --why was Bush Jr not poor?

In the same vein, the conservative economist Joseph A. Schumpeter likened recessions to a "cold douche". One wonders: who is "douched" and how? More importantly: who decides who gets 'douched'? Who decided that New Orleans would be left to its fate and the goons of Blackwater?

Currently, the nation faces economic calamity. However fallaciously, you can be sure that the right wing will not only benefit from the misfortunes of millions, they will try to figure out a way to blame them. It's the right wing way. But it's wrong!

Spencer believed that because society was evolving, government intervention ought to be minimal in social and political life. It didn't matter to Spencer that government is but a function, indeed, a creation of society and responsible to it. Seen in that light, efforts by privilege to blame the poor for their own rapacious and often dishonest or incompetent behaviors are absurd. Nevertheless, American capitalism remains greatly influenced by Spencer. The 'model' is still found in textbooks for Economics 101. It describes an ideal of American capitalism --“rational man” making rational decisions in a free and --presumably --rational market. But, in practice, economic decisions may or may not be rational and the free market exists only hypothetically. The market has been anything but rational.

Because the 'theories' of Spencer and, earlier, Adam Smith, often stress the 'practical', it is forgotten that Spencer and Smith were, themselves, 'theorists'. Every model we make of the world of sense experience is 'theoretical' by definition. The word "theory" is either misunderstood by the right wing or deliberately perverted for the propaganda value.

The word 'theory' is wrongly used as a pejorative. The right wing is inconsistent. 'Theories' from Spencer and, more recently, Milton Friedman or Arthur Laffer are are conveniently ignored or praised while 'theories' from everyone else are 'mere theory'. Last time I checked, 'right wing theories' were still 'theories' though most often and in reality they are simply frauds, lies, scams and 'white collar heists'.

Having waged war on the word "theory", the right wing likes to couple it with another word similarly victimized by right wing propaganda. That word is "conspiracy" --a perfectly good word, in fact, a legal term about which there is a venerable body of case law, thousands of SCOTUS decisions and some 400 years of common law. See: Findlaw or Cornell University Law Library online. Given techniques perfected by Herr Goebbels for Adolph Hitler, the combination of "conspiracy" and "theory" is lethal. The loss of these words to an adult vocabulary cripples the thought process itself, indeed, intellectual endeavor of any sort.

It must be noted that every great scientist was or is a theorist. Einstein was a "theorist". So was Newton, so too Darwin. So, too, Watson and Crick. Too much is made of 'right' and 'wrong'. It is a mistake to conclude, for example, that Einstein 'replaced' Newton. In fact, Einstein rests upon Newton's shoulders. Einstein is Newton from another angle. Einstein may be thought of as the hypothesis that Newton himself refused to make. [See: The Man Who Changed the Universe] Einstein does not refute Newton, he enlarges upon both Newton and Galileo. Galileo's equations describing the acceleration of falling bodies describes the very curvature of space-time.

Einstein has been confirmed no more times than Darwin; Newton is close enough for mundane applications or "government work" and Einstein will one day help us navigate the galaxy. Significantly, neither "theory" has been challenged in court —though both theories may very well be replaced one day by a "theory of everything", a TOE.

Only theories not liked by the right wing wind up in court, an absurd place to settle questions of science in any case. Law courts are inadequate to decide questions better resolved by observation and experiment, not rhetoric or case law. See: Darrow, Darwin & Dayton, the video at the end of this article.

There is a political agenda and a constituency behind the campaign of attacks on Darwinism. This constituency supports Intelligent Design for the same reasons the great rail road robber barons found support in the work of Herbert Spencer. The continued economic superiority of an entire class depends upon the widespread public acceptance of religious and/or ideological views which justify the existence of 'superior status'. Hitler, likewise, found in pseudo-science and mythology much justification for his anti-semitic crusades, his campaign of genocides, his wars of naked aggression.

Theories are often never of a final form —nor should they be! Unlike ideology, real science is self-correcting as new facts emerge from research. Darwin's theories were not only confirmed by Mendel, they accommodated Mendel which, in turn, strengthened Darwin. The science of genetics and the discovery of "mutations" confirm Darwin beyond any reasonable doubt. Every cowboy knows the truth of Darwin if he's never heard of him: "Never kill a slow roach; you just improve the breed!" As succinct a description of natural selection as I've ever heard. Likewise, every farmer who has bred for specific traits knows the truth of Darwin.

Future discoveries, like those of Mendel, may modify our views of Darwin, but will not discount them. Our view of Einstein is already modified but he is confirmed in many ways, notably at Alamogordo, Hiroshima, and Nagasaki. Light, indeed, bends around stars and other 'gravity lenses', time slows at near light speeds, space-time is a four dimensional continuum. More to the point, no one has ever sued because Einstein's theories were odds with a particular dogma or a political agenda. The right wing's disingenuous position is analogous to that of the Pope who forced Galileo to recant. I was critical of Ron Paul because his economic thinking was stuck in the 19th Century. The right wing generally, however, is stuck in the 17th.

It is certain that no future discovery will confirm "intelligent design", meaningless word play beyond any confirmation of any kind! Theories explain "facts" but facts can often confirm good theories as "fact”, just as facts have tended to confirm both Darwin and Einstein. By definition, doggerel is beyond confirmation of any kind. A.J. Ayer defined 'meaning' itself as that property of a 'sentence' that makes it subject to empirical confirmation. The theoretical core of ID is not meaningful and most certainly not of a type that would have been recognized by the philosophers upon whom Western Civilization is based.

Intelligent design is of a religious nature and people have a right to believe it. Treating Intelligent design as science is dishonest. As science, ID raises more questions than it explains. Most obviously: who designed the designer? ID assumes a designer to 'explain' creation but cites 'creation' to prove the existence of a designer. This is the classic circulus en probando fallacy.

People are free to believe fallacies, but they must not be free to impose them upon other people —especially at tax payer expense! A fact, for example, is the equation describing the acceleration of falling objects; examples of theory are both the Newtonian and the Einsteinian view of "gravitation" —seen differently by both. The entire science of genetics confirms Darwin who, interestingly, did not have the benefit of Mendel's research when he wrote Origin of the Species and the The Descent of Man. It was Mendel's research that described the very mechanism by which Darwin’s “traits” are passed on to succeeding generations. Accurate predictions are, in themselves, evidence in support of theories. [See: Evolution in Action, Julian Huxley]

Critics of Darwin have said that no one has yet produced an entirely new specie by selection. But they have indeed done just that! Consider wheat! Wheat does not grow in the wild. Related to ancient grasses, wheat is clearly the result of an ancient application of "artificial selection." Had wheat evolved naturally, it would be found growing wild like prairie grass. But it didn't and isn't.

Social Darwinism has harmed mankind. It rationalizes and justifies the perpetual and deliberate impoverishment of large segments of our society. The GOP will support this as a matter of policy so long as someone like Ronald Reagan can, nevertheless, make them "feel good about themselves". It is bad enough that this callous disregard for human life is fallaciously and insidiously associated with Darwin. That it is also a bald-face lie, a misstatement of Darwin, is unconscionable. We have thus reduced the philosophical basis for the American right wing to a single line from one of the world's great writers, Charles Dickens, whose character, Scrooge, epitomizes the American right wing

"Are there no workhouses? Are there no prisons...then let them die and decrease the surplus population."

—Scrooge, A Christmas Carol

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Right Wing Scams: 'Why Don't You Start Calling Me Gordon?'

by Len Hart, The Existentialist Cowboy

All but forgotten now, Enron --it's rise and calamitous fall --dominated front pages and sucked up airtime until knocked out of contention by 911. As I was reminded, it was the ghost of Gordon Gekko, brilliantly portrayed by Michael Douglas in 'Wall Street', who both presaged and haunted the fail of Enron and all those who served it or were temporarily enriched by its corporate shams and schemes.

As was the case in the 'Roaring Twenties', fortunes were lost in a heart beat, economic empires collapsed in the blink of an eye. Enron was one of them. Conveniently for the new Bush administration, indeed, the GOP itself a crime syndicate, corporate 'person-hood' benefited from a timely stay of execution -- 911.

Wall Street was one of Hollywood's more pertinent parables even if the name "Gekko" was a bit obvious. Real Gekkos (spelled Gecko) make fairly good pets --or so I am told! They eat roaches. And of late there are no shortage of roaches. The largest roach colonies are found in Washington D.C., Austin, TX, K-street or Wall Street --all sites of irradicable infestations. As we have seen, the GOP eats it own.

Opportunities for metaphor and analogy are endless and every comic needs a foil. Had there been no crooks or idiots, the careers of Voltaire and Mark Twain would have been much less brilliant. We owe a great debt to totalitarians, snobs, goppers, corporate crooks, Bush's surrogate torturers and would-be dictators. Where would Stephen Colbert be without them? Alas, the blog-o-sphere would be scrambling for material.

Enron was run by a gang that most certainly thought that, being "captains" of "industry", they could just pull out and disappear. I suppose every crook thinks that they will get away with it.

Enron will prove to be one of the most important episodes in the history of American business, and its story, from beginning to end, is inseparable from Ken Lay, its founder and long-time chairman. Thus, what people make of Enron—and what lessons they draw from it—will depend to a considerable degree on how they understand Lay.

As I’m sure you know, Enron has to date been blamed largely on free-market politicians, heartless corporate managers, and an egoistic chairman. In fact, as my book will show, Enron relied heavily on government favors, was run by postmodernist managers, and had as its chairman the kind of person Ayn Rand would have called “a second-hander.”
--On the Fall of Enron and Ken Lay: 'Philosophical Fraud' at an Errant Energy Company (and cap-and-trade, renewables forerunner), Robert Bradley Jr.

The US is, likewise, a financial shell. When GM, at last, is swallowed up by a foreign auto maker, what incentive will the new entity have to employ American workers when they can do just as well in Japan or Malaysia or China?

We have become a nation of consumers lent money by China so that we can buy goods manufactured in China. We are cattle, cows to be milked. When the teat runs dry we will be abandoned to third world status if we are not already.

In the meantime, the Bushies and other GOP Geckos will have run off with the last scraps of US wealth if they have not done so already. See the CIA's World Fact Book which lists the U.S. at the very bottom of the list with the world's largest negative Current Account Balance, formerly called the 'balance of trade deficit'. China tops the list with the world's largest POSITIVE Current Account Balance. Every banker can equate that with his own balance sheet and conclude that China, because of the policies of the GOP, now owns America if not the entire world.

The house of cards appears to have fallen --but not just yet! Like Ken Lay, Bush and his gang are most surely clinging to the belief that, unlike Lay, they will get away with it. Chances are good that Bush will live out the rest of his wasted life too stupid to regret a damn thing! It is this luxury, available only to the stupid, that I resent most!

Iraq was a big screw up. The invasion and theft of Iraqi oil was supposed to bail them out. Things have not quite worked out as planned. Then again, perhaps they have exceeded Bushco expectations. They are not yet jailed nor executed for capital war crimes (see: U.S. Codes, Title 18, Section 2441).

Just as Hitler thought he had learned from Napoleon's mistakes, Bush most certainly thought he had learned from Hitler's.

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Where Corporations Learn How to 'Manipulate' the Media

by Len Hart, The Existentialist Cowboy

The word 'manipulate' was used by Edward Bernays to describe how big corporations, like BP and Exxon, should harness the 'organized habits and opinions of the masses'. Bernays considered such 'manipulation' to be essential in a democratic society. BP's recent oil spill --now threatening the U.S. Gulf Coast, indeed, the entire Gulf of Mexico --is an occasion in which corporations will apply the principle of 'manipulation' referred to by Bernays.

"The conscious and intelligent manipulation [emphasis mine, LH] of the organized habits and opinions of the masses is an important element in democratic society.

--Edward Bernays

Over a period of some thirty years or more, the 'manipulation' of the media has become a growth industry. As one might expect, a pioneer 'consulting firm' is located in the Houston suburb of Sugar Land, TX. Ammerman Enterprises 'trains' executives from huge firms like Exxon, Shell, DuPont, HCA, Humana et al. The 'executives' and other corporate kiss-ups are taught what we would call 'spin' and 'propaganda' techniques most of which are especially applicable in 'crisis' situations of which the BP 'spill' is a corporatist's [fascist's] worst nightmare come true.

It was Ammerman Enterprises which 'trained' Exxon executives with respect to the Exxon Valdez. What we call 'spin' and PR, consultants call 'bridging' --a fancy, 'corporate' word for 'let's talk about something else' or 'I don't wanna talk about that; let's talk about this!' Another technique goes beyond mere bridging; it is a complete 'paradigm shift'! Done well, a hapless or cub reporter may not even notice.

Thousands of business and other professionals have chosen The Ammerman Experience's Effective Media Communications workshop in order to learn the skills needed to deal successfully with the media. In this small-group session you will learn:

• How to be interviewed.
• What is required before, during and after an interview.
• How to get your points into an interview.
• The most common (and damaging) media traps.
• What reporters want to know and why.
• How important perceptions are to your reputation.
• How to handle the communications aspects of a crisis situation.

Who Should Attend

This workshop is appropriate for anyone who may have to deal with the media.

Practical Learning

This is a skills-development workshop, not a lecture on concepts. As our firm's name suggests, the training we provide is experiential. We use simulated environments, including tough, experienced journalists. Some features of this workshop are:

• Instructors and role players with extensive media experience.
• Three television interviews.
• Two crisis news conferences with multiple reporters.
• Each exercise is videotaped and critiqued in an open forum by the instructor.

--The Ammerman Experience

The First Amendment, I believe, granted the right of free speech to real people --not mere legal abstractions, non-persons, artificial entities! The U.S. Supreme Court, dominated by five corporate-biased ideologues, think otherwise though it is anyone's guess how idiots like Scalia or Roberts managed to conclude so fallaciously, with such overt bias toward what St. Thomas More in fact called a 'conspiracy of rich men'. More's description remains the best description of the modern corporation.

It is 'real' people --not 'legal abstractions', mere words on paper --that are most harmed by 'corporate personhood' and the crimes against both nature and humanity that have resulted! In the Elizabethan era, 'companies' operated via a 'charter' granted by the sovereign. Doing business was not a 'right' but 'privilege' and a displeased Queen could revoke the privilege at will. I wonder if Elizabeth would have, by this time, revoked the right of BP to do business.

I can perceive nothing but a certain conspiracy of rich men procuring their own commodities under the name and title of the commonwealth.

They invent and devise all means and crafts, first how to keep safely, without fear of losing, that they have unjustly gathered together, and next how to hire and abuse the work and labour of the poor for as little money as may be. These devices, when the rich men have decreed to be kept and observed for the commonwealth's sake, that is to say for the wealth also of the poor people, then they be made laws. But these most wicked and vicious men, when they have by their insatiable covetousness divided among themselves all those things, which would have sufficed all men, yet how far be they from the wealth and felicity of the Utopian commonwealth? Out of the which, in that all the desire of money with the use of thereof is utterly secluded and banished, how great a heap of cares is cut away! How great an occasion of wickedness and mischief is plucked up by the roots!

Sir Thomas More (1478 - 1535), Utopia, Of the Religions in Utopia

I am among those who believe that it is time to restore the 'corporate death penalty' by seizing the assets of BP and prosecuting whatever management is guilty of criminal negligence and/or malfeasance of any type. Seizing BP effectively ends that company's existence as a corporation. Any assets remaining after damages are paid must be controllable by the public and in the public interest. The current management is put out of a job and where crimes are found --prosecuted.

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Media Conglomerates, Mergers, Concentration of Ownership

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Michael Moore: How 'Banksters' Bleed America

by Len Hart, The Existentialist Cowboy

I have stats that prove just one percent of the US population owns more than 95 percent of the rest of us combined. We are supposed to believe that's just an accident! It was, in fact, a deliberate transfer of wealth to those who benefit from US largesse to the US wealthy, members of the Military/Industrial complex, and, as Michael Moore dramatically demonstrates --a gang of 'banksters' who may have manufactured the recent 'financial crisis'!

Certainly --at the end of this 'crisis', only the 'banksters' will have benefited. Some already have! Everyone else wil be poorer if not poverty stricken. Bluntly --I am not all that excited about the restoration of the 'economic health' of the parasites who have leached upon the labors of those who create real wealth: workers!

It was written recently that Wall Street types were 'mocking' us, 'us' being the people of the US. Well, of course, Wall St mocks us. They're alright! They made out like the bandits they are in fact. Write this down: 1) Rich folk, bankers and elites LOVE recessions; they start them by 'taking their profits' i.e, dumping their holdings and depressing markets. 2) They short sell all the way down. 3) Then, they pick up the bargains when you are forced to sell or have already declared bankrupcy.

The banksters can do this because they control the markets.

Michael Moore 'Shakesdown' the Robber Barons

Clearly, the REAL cause of the economic collapse is the precipitous decline of US productivity over a period of some 30 years. The tell-tale symptom of this decline has been the fall of the dollar since Richard Nixon abandoned the 'gold standard' for the obvious reason that a run on the buck would have emptied Ft. Knox. Given a few ups and downs, the dollar has declined along with purchasing power, wages and living standards since that time.

The truth of my assertions can be found in the CIA's own 'World Fact Book' which lists China at the top of the list with the World's LARGEST POSITIVE 'current account balance'; the US is on bottom with the world's largest NEGATIVE current account balance, formerly known as the 'balance of trade' deficit! The difference between China's positive account and the US's negative account is largely the monies you might have made had not the GOP betrayed the American middle and lowers classes even as it enriched an increasingly tiny, ruling elite!

But it’s not a simple case of flourishing banks versus ailing workers: banks that are actually in the business of lending, as opposed to trading, are still in trouble. Most notably, Citigroup and Bank of America, which silenced talk of nationalization earlier this year by claiming that they had returned to profitability, are now — you guessed it — back to reporting losses.

Ask the people at Goldman, and they’ll tell you that it’s nobody’s business but their own how much they earn. But as one critic recently put it: “There is no financial institution that exists today that is not the direct or indirect beneficiary of trillions of dollars of taxpayer support for the financial system.” Indeed: Goldman has made a lot of money in its trading operations, but it was only able to stay in that game thanks to policies that put vast amounts of public money at risk, from the bailout of A.I.G. to the guarantees extended to many of Goldman’s bonds.

So who was this thundering bank critic? None other than Lawrence Summers, the Obama administration’s chief economist — and one of the architects of the administration’s bank policy, which up until now has been to go easy on financial institutions and hope that they mend themselves.

Why the change in tone? Administration officials are furious at the way the financial industry, just months after receiving a gigantic taxpayer bailout, is lobbying fiercely against serious reform. But you have to wonder what they expected to happen. They followed a softly, softly policy, providing aid with few strings, back when all of Wall Street was on the ropes; this left them with very little leverage over firms like Goldman that are now, once again, making a lot of money.

--Paul Krugman, The Banks are no Alright

The US is now a COW to be milked by 'banksters' at home and the Chinese ruling elite abroad. It was the treacherous, if not treasonous, activities of Bush, Nixon, Reagan and, most recently, Bush JR, who brought the world's great superpower to its knees!

It was Bush Jr who laid the groundwork for Nixon's famous trip China back in the seventies. Today, China props up a worthless dollar so that it can continue to sell US consumers --sheeple --products that were once produced by US industries, US businesses who employed a prosperous US working class that, bluntly, no longer exists. Name a single heavy industry in which the US leads the world (excluding military hardware). Secondly, the US dollar is worthless were it not propped up by China who is just trying to save their own asses by doing so.

Kudos to both Democracy Now and Michael Moore. Beginning with the 1989 classic Roger & Me, the Academy Award-winning director Michael Moore says his films come back to a central core concern: the economic system we have is unfair, unjust and undemocratic.

With his new film, Capitalism: A Love Story, Moore tackles the financial system and the interchanging circles of Washington politicians and corporate managers that run it. Moore says 'I thought I'd cut to the chase and propose we deal with this economic system and restructure it in a way that benefits people and not the wealthiest one percent.'

I agree! A 'recovery' in which wealth merely resumes its flow upward to just one percent of the population is just a band-aid on the pulmonary artery. If the flow upward is not stopped, the ultimate collapse of the US economy will make the Great Depression look like a Baptist picnic.

Also see:

• A Spiritual Mind Movie
• How the US Became a Vassal State of China
  
• Terrorism is Worse Under GOP Regimes
  
• The US Army Document That Proves the US is the World's Number One Sponsor of World Terrorism
• Dissecting the Scrambled Brains of the GOP
  
• Why the CIA is the World's Number One Terrorist Organization
  [w/LINKS]
• Why the CIA is the World's Number One Terrorist Organization [PDF]
• How the GOP Pays Off its 'Base' of Elites
  

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Move to China; Cut Out the Middle Man

by Len Hart, The Existentialist Cowboy

If because your job has been out-sourced to China and you are reduced to shopping at Wal-Mart, you should consider a move to China to cut out the middle man! China is going to get your all but worthless dollars anyway by way of US retail outlet: Wal-Mart! And when the dollar is completely worthless, it 'won't matter anyhow'. We will all be living in Chinese made tents.

If because of GOP transfers of unearned wealth to the increasingly tiny elite of about one percent of the population, labor is unproductive or impoverished the productivity of the nation will decline and ultimately collapse.

If the poor can no longer afford decent housing or food it is because elites have bid up prices on commodities. But because conservative robber barons and huge corporations have consolidated control of markets, your threats of boycott are laughed at. If you can no longer afford decent housing, health care or food, you have most certainly fallen off the bottom rung. It is clear that big business doesn't care about your fate and because the GOP is owned, the GOP doesn't care either.

A Give a Shit Attitude!

Just this kind of arrogance preceded the crash of '29 and the Great Depression which followed. This is not, therefore, the first time in American history that 'big business' flouted its 'give a shit' attitude. In his great 'A Rendezvous with Destiny' speech to the Democratic National Convention of 1936, FDR' made it very clear what is wrong with America today. His great speech is just as true now as then. FDR called it what it was and remains: economic tyranny!

For too many of us the political equality we once had won was meaningless in the face of economic inequality. A small group had concentrated into their own hands an almost complete control over other people's property, other people's money, other people's labor, other people's lives. For too many of us life was no longer free; liberty no longer real; men could no longer follow the pursuit of happiness.

Against economic tyranny such as this, the American citizen could appeal only to the organized power of Government. The collapse of 1929 showed up the despotism for what it was. The election of 1932 was the people's mandate to end it. Under that mandate it is being ended.

The royalists of the economic order have conceded that political freedom was the business of the Government, but they have maintained that economic slavery was nobody's business. They granted that the Government could protect the citizen in his right to vote, but they denied that the Government could do anything to protect the citizen in his right to work and his right to live.

Today we stand committed to the proposition that freedom is no half-and-half affair. If the average citizen is guaranteed equal opportunity in the polling place, he must have equal opportunity in the market place.

--A 'Rendezvous with Destiny, Franklin Delano Roosevelt, 1936

There are but two recent root 'aggravations' of this economic tyranny:

• The political ascendancy of the Bush family --Prescott Bush, George H.W. Bush, and, more recently, George W. Bush.
• The rise of Ronald Reagan, his disastrous and inequitable tax cut of 1982, the two year long depression caused by 'Reaganomics', his legacy of increased terrorism against US interests, rising inequalities of wealth and income, the deterioration of educational standards seemingly everywhere in the US.

The origins of our dollar's collapse may be found in the Nixon and Bush trips to China as well as Reagan's 'give away' to his elite and greedy base. These extremist right wing policies have eaten away at our economic health like wood worms. The right wing/GOP subversion of our currency resulted in exceptions for the ruling elites while lower and working classes pay more than their fair share of taxes. It's why the real elites --just one percent of the total population--often pay no tax whatsoever!

Labor is taxed but capital gets a free ride --a recipe for an impending economic collapse, a collapse that appears to be well underway and beyond anyone's power or ability to stop. Nevertheless, the government will play it's well-rehearsed role, that of shakedown arm of the nation's tiny but increasingly wealthy elite.

Nixon deplaned in Beijing on February 21, his flair for both diplomacy and drama well in evidence. Notes Nixon biographer Stephen Ambrose, "He knew that when his old friend John Foster Dulles had refused to shake the hand of Chou En-lai in Geneva in 1954, Chou had felt insulted. He knew too that American television cameras would be at the Peking airport to film his arrival. A dozen times on the way to Peking, Nixon told Kissinger and Secretary of State William Rogers that they were to stay on the plane until he had descended the gangway and shaken Chou En-lai’s hand. As added insurance, a Secret Service agent blocked the aisle of Air Force One to make sure the president emerged alone."

Soon after their arrival, Nixon and Kissinger were summoned to a previously unannounced meeting with Chairman Mao, which Kissinger later referred to as their "encounter with history." Next came a formal welcome banquet hosted by Chou En-lai, broadcast live on the American morning news thanks to the 13-hour time difference. In the Great Hall of the People, as the People’s Liberation Army band played such American favorites as "America the Beautiful" and "Home on the Range," course after course was followed by seemingly endless rounds of toasts. "‘Seize the hour! Seize the day!’" Nixon quoted from Mao, raising his glass to his Chinese hosts. But beyond the pomp and spectacle, the banquets sent a clear and dramatic message to everyone watching that a new relationship was being forged.

--Nixon's China Game, The American Experience

Nixon's trip was preceded by a long buildup that included 'ping pong diplomacy' and a little known or written about advance trip by George Bush Sr.

Premier Chou En-lai worked the public relations opportunity beautifully, receiving the Americans at a banquet in the Great Hall of the People on April 14. "You have opened a new chapter in the relations of the American and Chinese people," he told the unlikely diplomats. "I am confident that this beginning again of our friendship will certainly meet with majority support of our two peoples." He also extended an invitation for more American journalists to visit China, provided they do not "all come at one time." That same day, the US announced plans to remove a 20-year embargo on trade with China. A Chinese table tennis team reciprocated by visiting the United States.

Ping-Pong was "an apt metaphor for the relations between Washington and Peking" noted a Time reporter, as each nation signaled, in turn, its openness to change. Despite the public warming trend, Nixon and Kissinger decided to keep their back-channel negotiations with China to themselves. It was not until July 15, after Kissinger's secret mission to Beijing, that Nixon announced that he, too, would make the journey the following year, as the first American president to visit China.

--Ping-Pong Diplomacy, The American Experience

Bush's bailouts proved Marx correct but, like everything else GOP, they' mucked it up. It's not even 'good' Marxism. The bailouts have benefited only the nation's elites, the same gang that had benefited most from Reagan's tax cut of 1982. Marx said that Capitalism would collapse of its own inconsistencies, 'internal tensions which will lead to its destruction.' The GOP, the greater of two major sellouts to the MIC and K-Street, merely hastened that result. The 'elites' who benefit do not merely maintain offices on K-Street, they OWN K-Street! The Military/Industrial complex serves at their pleasure. The MIC is expected to defend 'their' interests (not yours) abroad with the lives of YOUR sons and daughters.

Some recent history may illustrate the point: the Wall Street crash of 1929 was followed by a severe world wide depression acutely felt in the US, Germany, France, and to a lesser degree --Great Britain and Sweden. Nevertheless, unemployment was high in Sweden when that nation returned a Labor government committed to a program of public investment to address the high unemployment problem. It worked. By 1935 real output in Sweden was 7 percent above its 1929 level. Unemployment was reduced and the finance minister was said to have been happy to suffer another budget deficit to stimulate the economy.

Ronald Reagan's budget deficit did not have as happy a result. So --why did Keynesian economics work for Sweden in 1929-30 but not for Ronald Reagan more recently? The answer is simple: Sweden was then --as it is now --among the world's most egalitarian economies. The US --among the very least egalitarian! Reagan's tax cut of 1982 benefited only the investor class at a time when increased consumer spending might have stimulated the economy. A 'Keynesian' deficit might have stimulated growth! The Reagan deficit had the opposite effect.

What's Wrong with the American Economy is Wealth and Income Inequities and the Dysfunctional Mentalities That Create Them

The proof of my assertion is the public record. Reagan's tax cut of 1982 was quickly followed by the nation's worst recession since the Great Depression, a recession of some 18 months characterized by record levels of unemployment and home losses. The economy contracted, people had less money to spend, many lost their homes and slept under bridges in 'boomtown' Houston. I know --I saw it. I was one of the lucky ones who somehow managed to keep a cozy home to sleep in. Luck! But for the grace of God go I! And no thanks to Unca Ronnie!

Reagan's best critics were found inside his regime, primarily, budget director David Stockman who blamed a "noisy faction of Republicans" for Reagan's infamous tax cut and the debacle that followed. Reagan might have achieved the prosperity that Keynes had predicted. That might have happened had his policies rewarded the working and middle classes instead of the rich and idle elites. Fact is --Ronnie was owned! The government is owned! The MIC is owned! We are owned! We are slaves to a system that may be beyond out ability to reform short of revolution.

The Reagan-heads forgot that the wealth of a nation is the result of the 'work' that is done by its people --not the 'offshore investments' of an utterly worthless, idle leisure class.

The US economy has entered into a contraction not seen since 1929. Private and public payrolls combined have shrunk for 14 straight months. Just recently, the US economy lost some 650,000 jobs over a period of four months. At the time, I asked: why had not GWB's bailouts worked? Obviously, as was the case with Reagan's 'voodoo economics', the wrong people got the money. Most certainly, the wrong people continue to get the money. The wrong 'people' were bailed out. The wrong people still get rich. You still get poorer whether you still have a job or not.

There was no Reagan recovery!

The record shows that the growth rate was 3% between 1979 and 1989 --the same as the growth rate between 1973 and 1979! There was, then, no improvement with "voodoo economics" than without it. Did Reagan's tax cuts bring about more growth than would have normally occurred? Of course not! The opposite occurred. The GOP/right wing is happy when you swallow whatever they puke up.

Worth repeating:

The opposite occurred. The record shows that the growth rate was 3% between 1979 and 1989 --the same as the growth rate between 1973 and 1979! There was, then, no improvement with "voodoo economics" than without it.

There was no Reagan recovery. Punch out the next gopper who tries to tell you that there was. Wealth did not trickle down! Rather, wealth has continued to be transferred upward to about one percent of the total population. Recently, the bailouts just wound up in the wrong hands and may have made matters worse! As Santayana said: "Those who do not remember the past are condemned to relive it!"

I am inclined to believe that this transfer was deliberate, planned and executed. It abated only briefly in Clinton's second term. That is but one reason Clinton is officially and systematically demonized and reviled. I have my own problems with Clinton, that is, he did not go far enough. But everything said about Clinton by Republicans are lies! Likewise, I have problems with Obama --but everything said about him by Republicans can be dismissed summarily.

The rise of Ronald Reagan brought with it a spreading of wealth upward to the upper classes and Wall Street insiders, in fact, an increasingly tiny elite of just one percent of the nation which owns more than 90 percent of the nation's total wealth. That fact is graphically illustrated above. The result is factually documented by the government's own agencies --Census Bureau, Bureau of Labor Statistics, Department of Commerce-BEA, et al. Income inequality is measured by what economists call the GINI index. The higher the GINI, the greater the inequality. These numbers, recognized and cited by economists from Friedman to Krugman, from Keynes to Galbraith, invariably increase during GOP regimes.

Now --as the late Steve Kangas pointed out, 'conservatives' will claim that correlation is not 'causation'. I think conservatives are wrong on that point, but if, in fact, GINIS always go up under GOP regimes, what difference does it make? The pragmatic solution is simply this: fire the GOP! Permanently! We cannot afford to continue to support both the GOP and its elite, pampered, privileged sponsors in business, industry and government. See more about 'income inequalities' at: What do liberals believe about income inequality? Also: Myth: The rich get rich because of merit. The rich get rich because they are born rich and get obscene tax cuts for producing nothing.

There are many parallels with the American economy of the 1920s. The economy was booming but by 1927 the nation had overproduced goods for which there was no market. Overproduction led to a slowdown in both manufacturing and agriculture. This is evidence --if not proof --that 'trickle down/supply side' economics is a deliberate right wing fraud. Transferring monies to manufacturers that are over-produced is economic disaster. Why should a capitalist get a tax cut for producing product that cannot and will not be sold? Wealth does not 'trickle down', rather, it is transferred to tax heavens offshore. Clearly --a bailout for big banks is a mistake that will continue to have the effect of reducing the supply of money in circulation --a 'contraction'. The so-called 'Great Depression' was, in fact, a great contraction in which those who would have spent monies were deprived of it.

During the Great Depression and, later, Ronald Reagan's depression of about two years, millions lost their jobs. Earlier, in 1929, bankers and financiers continued to speculate on stocks, borrowing the money and buying stocks 'on margin'. More recently, 'short sellers' made fortunes that you can rest assured have already been transferred into offshore tax havens.

The wealth of a nation is not the money it prints, borrows or coins. The wealth of a nation is the productivity of its people and their industries. Both declined under Reagan and declined again under Bush and declined yet again under the other Bush!

One wonders why Reagan didn't just cut out the middle man. A more equitable tax cut or better a more progressive tax might have put more spendable income directly into the hands of consumers. Spent money circulates and drives an economy. That consumers spend money seems to be a fact lost on the likes of Reagan, Bush, and the nation's rich and callous elites.

Surely, there were knowledgeable advisers in Reagan's regime who knew better. The tax cut, therefore, was entirely political, a pay off to the rich for their support, or more precisely, their investment! Nothing has changed in the GOP. The Bush administration has made several such "payoffs" during his catastrophic and criminal regime.

The 'contraction' of an economy is typically called a 'depression'. The US economy is contracting due to

• the transfer of wealth to but about one percent of the population;
• this 'elite' has transferred most of its wealth offshore where it has absolutely no good effect on the domestic US economy.

The current collapse of the US is the end result of a trend that was begun with the passage of Ronald Reagan's infamous tax cut for his rich, elite base. The year was 1982. Historians willl write of that date that it was the beginning of the end of the American empire.

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Economics Lessons from 'A Beautiful Mind'

by Len Hart, The Existentialist Cowboy

The Greek tradition found virtue in the pursuit of rational self interest, a tradition that later found expression in Adam Smith's "Wealth of Nations" in which is posited "rational self-interest" as an "invisible hand" upon "free markets". Recent bank failures, recession, accounting crimes and corporate scandals, however, amount to enormous empirical evidence that "laissez faire" capitalism is a myth, and if not a myth, an impractical ideology. The "invisible hand" --as modern conservatives have defined and appropriated it --is mere "wishful thinking".

If there is an "invisible hand" it does not militate against crooks, charlatans, and fast buck artists who have now firmly ensconced themselves as much in board rooms as among sleazy fly-by-nighters. The Reagan administration alone, like that of Warren Harding before it, is proof that, left to its own devices, an elite, robber-baron class will act to enrich itself and, in the process, imperil the nation. Business is not the business of America or, indeed, any nation which wishes to remain solvent or, in other ways, ensure the defense and futures of its people. A 'robber baron' era, a 'Gilded Age' did not merely precede the Great Depression, it caused it by impoverishing every other class but the upper crust. While there has never been a bust without the 'bubble' that precedes it, the 'bubble' itself is the result of the deliberate transfer of wealth to an increasingly small elite. Today, in America, that elite is but one percent of the total population. It owns more than some 95 percent of the rest of us combined.

Markets left to their own devices trend toward oligopoly in which oligarchs effect political plutocracy through the exercise of sheer political muscle, intimidation, fraud, and outright bribery. The "invisible hand" does not moderate the rich and powerful. If a ruling cabal is to be moderated it must be done by political action and the power of cooperative or, perhaps, 'socialist' interventions. This much is implied by Adams himself.

In civilized society he stands at all times in need of the cooperation and assistance of great multitudes, while his whole life is scarce sufficient to gain the friendship of a few persons. In almost every other race of animals each individual, when it is grown up to maturity, is entirely*43 independent, and in its natural state has occasion for the assistance of no other living creature. But man has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only. He will be more likely to prevail if he can interest their self-love in his favour, and show them that it is for their own advantage to do for him what he requires of them.

--Adam Smith, The Wealth of Nations, Book I, Chapter II, Of the Principle which gives Occasion to the Division of Labour

Whenever I hear a modern Republican spout Smith on the one hand and 'laissez-faire' Capitalism on the other, I suspect that they have not bothered to read Smith. Certainly, my concerns are less a criticism of Smith himself than of modern economic conservatives and/or 'supply-siders' who find in Smith a rationalization for many rapacious and monopolistic behaviors lately witnessed among the ruling one percent and the combination of both greed and incompetence among the big banks.

Smith is no more to be faulted for this than Darwin should be faulted for the excesses of "Social Darwinism" --neither Social nor Darwin. "Social Darwinists" are most often associated with the age of the Robber Barons, providing them the ideological bias with which they justified all manner of corporate crookedness and sleazy practices. Likewise, the contemporary GOP believes 'greed is good' , a neat slogan by which, during the Reagan years in particular, the transfer of wealth upward by way of inequitable tax cuts of trillions of dollars to the ruling elite led inexorably to Reagan's depression of some two years --the deepest and longest depression since 1929. The maxim: "from each according to his ability, to each according to his need' was, of course, not merely dismissed but reviled. Communism -- it was dismissively called!

To his credit, Smith himself feared the rise of monopoly power --a fear which modern conservative commentary either does not understand or omits entirely. Moreover, Smith subscribed to a 'labor theory of value' which 'wingnuts' would have you believe was the radical, 'seditious' brainchild of that 'Satan incarnate' --Karl Marx. Not so! Smith subscribed to a 'labor theory' of value as have almost every major economist since the 18th Century.

The real price of everything, what everything really costs to the man who wants to acquire it, is the toil and trouble of acquiring it. What everything is really worth to the man who has acquired it, and who wants to dispose of it or exchange it for something else, is the toil and trouble which it can save to himself, and which it can impose upon other people. What is bought with money or with goods is purchased by labour as much as what we acquire by the toil of our own body. That money or those goods indeed save us this toil. They contain the value of a certain quantity of labour which we exchange for what is supposed at the time to contain the value of an equal quantity. Labour was the first price, the original purchase-money that was paid for all things. It was not by gold or by silver, but by labour, that all the wealth of the world was originally purchased; and its value, to those who possess it, and who want to exchange it for some new productions, is precisely equal to the quantity of labour which it can enable them to purchase or command.

--Adam Smith, The Wealth of Nations, Chapter 5: Of the Real and Nominal Price of Commodities, or their Price in Labour, and their Price in Money

Immanuel Kant however, assailed the pursuit of self interest in favor of "good in and of itself" --a "categorical imperative", a moral standard that no one I know is capable of living up to. Nevertheless, Kant has became the other great influence upon American conservative thought --though I cannot give most contemporary conservatives credit for having actually read Kant or understanding him. It is not Kant himself but the many misconceptions about him that may be found lurking beneath the ideological surface of the extremist right-wing and the religious right.

It is unfortunate that Kant himself defined this "transcendent reality" --which he called the noumena --as being unknowable. By definition, nothing meaningful can be said about whatever is "unknowable". One cannot make sense about the unknowable; there is no 'knowledge' of the unknowable. Nevertheless, righteous ideologues will insist upon 'deducing' from the unknowable a veritable gestalt of gibberish which they profess to know as 'fact' and, upon that basis, will seek to impose it upon you!

We are given the false choice between two mutually exclusive alternatives: "selfishness" or "selfless transcendentalism". Neither position, however, is entirely true and neither is completely understood even by the conservative mentality that espouses them. Adam Smith's "invisible hand" is no more valid than Laffer's "trickle down" theory and it is highly doubtful that even Kant lived up to his own moral dictum --though I credit Kant with sincerity and doubt it among his followers. Mankind is probably neither entirely selfish nor entirely selfless but somewhere in between.

The truth is most likely found in the middle. The work of mathematician John Nash, celebrated in the motion picture "A Beautiful Mind", wrote a brilliant paper on "binding agreements" that casts grave doubts upon many "conservative" fables, shibboleths, and fairy tales --including those whose origins lie in "mutually exclusive" intellectual traditions.

Next in my mini-series about the great economic thought leaders who were seminal in the development and success of modern outsourcing is one of my favorites, the mathematician John F. Nash, who took economists a step or two beyond Adam Smith with his ideas on Game Theory and Behavioral Economics.

His conclusions are right in the Vested Outsourcing wheelhouse; that is, playing nice and playing cooperatively from the start of a business or contract relationship is good for everyone.

If you’ve seen the movie A Beautiful Mind, which is loosely based on the life of Nash, there’s a brief scene in it that captures in an entertaining nutshell his great breakthrough in the use of games – especially non-cooperative games – as a basis for understanding complicated economic issues.

In the scene Nash, as portrayed by Russell Crowe, has a revelatory moment in a campus bar as he and his mates ponder the best ways to produce optimum results in their approach to and pursuit of a beautiful blonde and her friends.

Nash’s inspiration was that Adam Smith’s principle that the “best result comes from everyone in a group doing what’s best for themselves” was incomplete and needed revision: The best result comes from everyone in a group doing what’s best for themselves and the group.

--The Big Thinkers – Part 2 John Nash: Game Theory (or Playing Nice is Good for Everyone)

The American right wing is locked into 'competition' whether it works or not. The American right wing is not prepared to consider facts that prove that in many if not all cases, cooperation is more practical, more efficient and, in the longer term, more successful. It must be especially annoying for the right wing mentality that this principle was proven by three horny intellectuals --geeks --in a bar, in the northeast.

A Beautiful Mind

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What if the GOP Had Let Wall Street 'Privatize' Social Security?

For years the GOP, the demagogue John McCain and the Bush administration have looked at Social Security and licked their greedy chops! Now is the time to ask: what if these greedy GOP bastards had privatized Social Security?? The quick response: millions of retirees would be facing starvation or the FEMA camps!

Social Security was targeted not because it was a failure or because it was broken as we were repeatedly told. It was targeted because it was a success --in fact, Social Security was and remains the government's ONLY unqualified success. Certainly --it could have been depended upon to further enrich the fat cats at your expense.

In the meantime, Wall Street and the GOP blackmail the nation: bail out the robber barons or face the collapse of the dollar when, in fact, the bailout itself threatens catastrophic hyperinflation i.e, the utter collapse of the buck.

Economist Michael Hudson: the bailout is a giveaway that will cause hyperinflation and dollar collapse

Bailout talks stall as Bush meets with Congressional leaders and Presidential candidates. German Finance Minister says US will no longer be the financial Superpower. French President Sarkozy says the days when "the all powerful market is always right are over". The Real News Network spoke to economist and historian Dr. Michael Hudson who says that it's not a "bailout" but a "giveaway" and will create a new kleptocracy of billionaires.

Dr. Michael Hudson is a Wall Street financial analyst and historian. Dr. Hudson was Dennis Kucinich’s Chief Economic Advisor in the recent Democratic primary presidential campaign, and has advised the U.S., Canadian, Mexican and Latvian governments, as well as the United Nations Institute for Training and Research (UNITAR). A Distinguished Research Professor at University of Missouri, Kansas City, he is the author of many books, including Super Imperialism: The Economic Strategy of American Empire and of Super-Imperialism and of The Myth of Aid .

--Once in a Century Rip-Off

GOP attacks on Social Security was party's first phony crisis, perhaps a dry run for the current bailout.

To save Social Security, Bush wants to destroy it -- replacing government-guaranteed retirement benefits with private accounts that will be subject to the whims of the stock market. It's an expensive plan. Allowing workers to divert even a small portion of their payroll taxes into private investments, as Bush is proposing, would require the government to borrow at least $2 trillion to make up the immediate shortfall. It's also completely unnecessary, according to Paul Krugman, a prize-winning professor of economics at Princeton University. In a blistering series of columns in the New York Times, Krugman has marshaled the economic data to show that Social Security is not only solvent, it's in much better financial shape than the rest of the federal government. "The people who hustled America into a tax cut to eliminate an imaginary budget surplus and a war to eliminate imaginary weapons," Krugman wrote recently, "are now trying another bum's rush."

At his tree-shaded home in Princeton, New Jersey, Krugman took a break from working on a new economics textbook to explain why the crisis is phony -- and what's wrong with Bush's plan "to convert Social Security into a giant 401(k)."

What would you say to college students and young workers who are convinced they'll never see a dime of the money they put into Social Security?

You've been sold a scare story. Right now Social Security has a large and growing trust fund -- a surplus that has been collected to pay for the surge in benefits we'll experience when the baby boomers start to retire. If you're twenty now, you'll be hitting retirement around 2052. That's the year the Congressional Budget Office says the trust fund will run out. In fact, many economists say it may never run out. If the economy continues to grow at an average rate, the trust fund could quite possibly last forever.

But what happens if it doesn't?

Even if the trust fund does run out, Social Security will still be able to pay eighty percent of promised benefits. The actual shortfall would be a pretty small part of the federal budget, quite easily made up from other sources. Once the whole baby-boomer generation is into the retirement pool, Social Security's share of the gross domestic product will only increase by about two percent. Well, President Bush's tax cuts are more than two percent of GDP -- and they're happening right now, not fifty years from now. So the idea that there's this Social Security thing that is a huge problem is just wrong.

But if the trust fund does run out, the government would have to raise taxes or cut benefits, or some combination of both, to keep Social Security solvent.

Yes, if the trust fund is ever depleted, then something will have to be done. But you need to have some perspective on the seriousness of this whole thing. On the day the trust fund is exhausted, Social Security revenue will cover about eighty percent of the cost of benefits. Right now -- today -- if you look at the U.S. government outside of Social Security, revenue covers only about sixty-eight percent of total government spending. So on the day the trust fund is exhausted, forty-seven years from now, Social Security will be in better financial shape than the rest of the U.S. government is today.

So if there's no crisis in Social Security, why is President Bush pushing so hard to privatize it?

It's politics. Since the days of Barry Goldwater, the Republican right has really wanted to dismantle Social Security. And now they have a degree of political dominance that lets them push it to the top of the agenda -- even though no rational analysis of the actual problems facing the U.S. government would say that it belongs there.

Why do they want to dismantle it?

It's hard to understand why anyone would want to return us to the days before the New Deal, when millions of elderly people lived in poverty. But if you really dislike the notion that the government provides a safety net for the poor, then Social Security is the prime target. The U.S. government is a big insurance company, with a side business in national security. Social Security is the biggest social-insurance program that we have. It's been highly successful, and it's extremely popular. It's one of the things that makes people feel somewhat good about government -- and so, therefore, it must go.

And some people stand to profit from abolishing it. Wall Street poured a lot of money into both of Bush's campaigns, hoping he will divert Social Security into the stock market.

That's a factor, but I don't think it's the reason behind it. Attacking Social Security is a lot like attacking Iraq -- just because a lot of people stood to get lucrative contracts from it, that doesn't mean that's why they did it. If you privatize Social Security, there's going to be a tremendous amount of income for the mutual-fund industry. That's one reason there is a constituency for this on Wall Street. And that's one of the important reasons why this is really gonna work very badly.

What do you mean? Those who are pushing privatization say that our financial markets are one of our greatest strengths -- that private investment will work better in the long run than government-managed accounts with lower rates of return.

There are two problems with that. First, the fees charged on private accounts will be a significant drain on returns. In a typical portfolio, we're probably looking at a return of four percent. But fees are likely to take at least one percent, like they do in Britain. So now we're down to a return of three percent or less on private accounts. And since Bush wants to borrow $2 trillion to pay for the transition, we're talking about borrowing at interest rates of three percent to establish private accounts that will yield three percent -- with a lot of additional risk. So it's a lose-lose proposition, except for the mutual-fund industry.

The second problem with the market is that some people -- probably many people -- will end up getting much less than they would have under the current system, depending on which funds they pick and how the market does. A lot of people will hit age sixty-five with very little in their private account -- and that means a big return of poverty among the elderly, which is exactly what's happening in Britain right now. As a result, the government will have to step back in and rescue people. We'll have more suffering and bigger bills. People will ask: Where did all that money go? The answer will be: It basically went into mutual-fund fees.

But what if stocks do well? Isn't it possible that privatization would work?

The only possible way that stock returns can be high enough to make privatization work is if the U.S. economy grows at three to four percent a year for the next fifty years. But Social Security's own trustees expect the economy's growth rate to slow to 1.8 percent. If that happens -- if their own assumptions are correct -- then privatization would be a disaster. And if that doesn't happen -- if the economy continues to grow at a steady rate -- then the trust fund is good for the rest of the century, and we don't need privatization.

In selling the idea that there's a crisis, Bush has a lot of powerful words on his side: "choice," "freedom," "ownership society." What words do you have to counter his sales job?

Scam. Three-card monte. I've been thinking a lot about flying pigs. The privateers are claiming that you can have something for nothing. They're basically saying, "Let's assume that pigs can fly." And when you say, "You know, it's not good to assume that pigs can fly," they respond by saying, "What's wrong with you? Don't you understand the enormous advantage of flying pigs?"

The only reason they talk about how wonderful an ownership society would be is because we managed to win the battle over the word privatization. The Cato Institute -- which is the intellectual headquarters for all this stuff -- founded something in 1995 called the Project on Social Security Privatization. But focus groups don't like that word, so in 2002 they changed the name to the Project on Social Security Choice. They didn't announce a name change -- they just went back and scrubbed their Web site, so there's no indication that it was ever called "privatization."

If there's no crisis in Social Security, why aren't the Democrats saying that more clearly and forcefully?

There's a lot of timidity. They're desperately afraid of seeming like "Oh, well -- we have our heads in the sand, and we're not active." I would like to see them step up to the plate and say that these claims that we're going to have a crisis sometime in the next fifteen years is just garbage. Bush is handing them an opportunity by making this the centerpiece of his agenda. Democrats should treat privatizing Social Security the way Republicans treated Clinton's health-care plan -- they should say, "This is a disaster, and we will stand against it." Social Security is simply not the biggest problem facing the government today.

What is?

If you really want to get scared about something that can happen between now and 2052, you should talk about Medicare and Medicaid. The entire system of private health insurance is gradually collapsing. And as the share of people getting medical insurance through their employers continues to decline, the number of people who have to rely on the government for health insurance keeps going up. At the same time, medical costs keep on rising, because doctors keep on figuring out new stuff to do -- procedures that didn't exist ten or twenty years ago.

So what needs to be done to shore up Medicare?

In our system, we have huge administrative costs -- which are mostly driven by insurance companies spending huge amounts of money trying to avoid covering people. Our health-care costs are eighty percent higher than those in other advanced countries. The best way to contain those costs is to go to a single-payer system, one in which the government insures everyone. That would probably cut the cost of health care by at least twenty-five percent.

But there's no way that will happen under Bush.

He actually wants to do the opposite. If he manages to privatize Social Security, he'll try to privatize Medicare next. He'll try to strip away guaranteed health care and turn it into some kind of system of individual health accounts. The right says that what we need is more choice, more competition. But every piece of evidence suggests that health care is an area in which privatization actually raises costs. If they succeed at dismantling both Social Security and Medicare, then you're pretty much back, on domestic policy, to the days of Warren Harding -- which is exactly where they want to go.

--The Fake Crisis: Economist Paul Krugman explains Bush's latest con -- social security

We have been lucky so far to have beaten GOP attempts to let Wall Street insiders steal your Social Security, steal your retirement prospects. If the GOP is not decisively discredited, exposed to be the endemically crooked party that it is in fact, we might not be so lucky in the future. Increasingly --the future is now.

Published Articles

• Bush's Conspiracy to Create an American Police State: Part I, Police States Begin With False Flag Attacks
• Bush's Conspiracy to Create an American Police State: Part II, A Climate of Fear is Maintained
• Bush's Conspiracy to Create an American Police State: Part III, In Fascist Dictatorships Telling the truth becomes a crime
• Bush's Conspiracy to Create an American Police State: Part IV, the state forces an 'existential' choice
• Bush's Conspiracy to Create an American Police State: Part V, Public Opinion Becomes Irrelevant
• Bush's Conspiracy to Create an American Police State: Part VI, The government places itself above the law
• Bush's Conspiracy to Create an American Police State: Part VII, The Government Denies 'Due Process of Law'
• Bush's Conspiracy to Create an American Police State Part VIII: Atrocities are justified with lies, myths or propaganda

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