May 4, 2014 For the People Owning the Too-Big-To-Fail Corporations

May 4, 2014 For the People Owning the Too-Big-To-Fail Corporations

By Charles Brown

It is important to point out that the Too-big-to-fail banks and corporations did in fact fail back in 2008; even though they were bailed out. The demand the Wall Street rulers made to Washington for a bailout was a confession that the whole financial system was insolvent. The USA's, We the People's, bailout brought the finance system back from the dead. Capitalism does not add up. After 500 years, it ends up that capitalism is bankrupt and insolvent by its own generally accepted accounting principles.

The shadowy finance ministers who ordered President Bush to bailout Wall Street, said that certain financial institutions are "too big to fail". If they fail they will destroy the financial system, and so the federal government must save them in order to avoid total economic disaster for America and the world.

So, they were given trillions of dollars of what amounted to semi-gifts ( sort of "pay it back if you can at your own pace"; would that we could get such terms in loans from these same banks) , and the concept of "too-big-to-fail corporations" gained wide public awareness.

Although, there was not total collapse , the bank failures that did occur triggered the so-called Great Recession. We, the 99%, suffered and suffer still enormously from that recession as it resulted in all around economic distress for tens of millions of Americans over the last six years. These failures of the leading private institutions of our Economy, led to an excruciating economic Depression for the Many. Large swathes of the middle and "lower" classes suffer poverty, foreclosure, unemployment, and the many ways of misery, premature deaths, disease, divorce, crime, etc, that are generated by economic downturn , especially in a jobless recovery only for corporate profits and exploitation by the 1%

It is objectively true that this would have been worse for the 99% if the Too-big-to-fails had not been bailed out. So, it is not the case that these corporations should not have been bailed out, but that their Creditor, The People, should get more for their bailout money than they did: ownership of the big debtors.

To reiterate,_circa_ 2008, with the insolvency of financial institutions designated Too-big-to-fails by our nation's highest financial ministers ( in other words straight from the horse's mouth), We, the People, learned of or were reminded of a category of economic life that had not been so explicit in the national discourse. These Big Banks were bailed out and avoided bankruptcy with guarantees or assurances of anywhere from $16 to 29 trillion by the United States of America, because the national unelected , financial ministers declared that their failure would bring down the entire financial industry of the US and perhaps "the West". In other words, the insolvency of the Too-Big-To-Fail corporations was in fact the insolvency of the whole financial system. It was a confession that capitalism doesn't add up; it fundamentally cannot meet its own standard of moral hazard. Wall Street's debts exceeded its assets by a dozen or two trillion dollars, at that historic moment.

Any debtor of Wall Street creditors who reaches such a moment , must not be bailed out because of the danger of moral hazard. If we apply Wall Street's own standard to itself, the 2008 bailout represents the biggest moral hazard in history, pretty much. So, the principle of moral hazard is dead.

General Motors and Chrysler, two of our largest corporations, though evidently an order of magnitude smaller than the Wall Street Too-big-to-fails, were also bailed because they arer too big to fail without devastating economic impact. . The bailed out Too-big-to-fails, owned and controlled and expropriated by the 1%, continue to live in fabulous luxury greater than any ruling class in history, There is a long history of government bailout of corporations ( (History of U.S. Gov't Bailouts http://www.propublica.org/special/government-bailouts

http://en.wikipedia.org/wiki/Too_big_to_fail)

The Great Recession caused many states ,including, California and Illinois, actual insolvency , though it was not declared; and they were bailed out of deficits by the Obama Stimulus plan.

What is to be done now so many years from The Financial Big Bang ?

Well, like the Big Bang, it is still affecting us.

We, the People, who bailed out the Economy, must have ownership and control of all Too-big-to-fail corporations. Private owners , who put private interests above public interests always, cannot be trusted with control and distribution of the products of the Economy's Too-big-to-fail Economic Units, because their failure does not impact the incomes of the 1% current owners, but only the lives of the masses of people. The failure of Too-big-to-fails is dumped on the 99%, and avoided by the 1% who own them now. The 99% must own them, therefore.

We must reverse the current circumstance in which , essentially, the Too-big-to-fails own The People, as demonstrated by their ordering the Presidents and Congress to give them dozens of Trillions of dollars without their giving up ownership of themselves in exchange as would occur in any such transaction in the "free" market. The Too-big-to-fails still owe the People for the Bailout. We, The Creditors, are coming to Collect.

Enact a .law :requiring the Federal Reserve to report and list quarterly on all too-big-to-fail corporations, and initiate proceedings to take them over. Use the same criterion as was used in the bailouts.

Enact a Law: One of the rationales for exploiting interests from debtors, recipients of loans, is that the creditor puts its money at risk. Since, the Too-Big-to-Fails will be bailed by the government if too many of their loans fail, their interest rates should be abated or negated, because they are not taking the risk they claim.

Reassert federal ownership of General Motors and Chrysler. Chrysler has been bailed out twice by the federal government. Take Federal ownership of JP Morgan, Citibank, Wells Fargo, Goldman Sachs, AIG and all Wall Street, Too-big-to-fails. before they fail again.

Subject: Wall Street Meltdown Primer

Bello is mostly on here, though his accounting of the 1997 Asian financial crisis may need some revision, i.e. There is substantial evidence that the 'crisis' was a purely US state-manufactured one: The Clinton Administration was demanding that Thailand and Indonesia fully open their financial markets to US finance and capital sectors. When they objected, Clinton's Commerce Secretary, Robert Rubin, instructed America's giant hedge funds to launch a speculative attack on the Thai baht. The devastation then spread to Indonesia and then South Korea. Lesson learned.

Tony Published on Friday, September 26, 2008 by Foreign Policy in Focus Wall Street Meltdown Primer

by Walden Bello Many on Wall Street and the rest of us are still digesting the momentous events of the last 10 days. Between one and three trillion dollars worth of financial assets have evaporated. Wall Street has been effectively nationalized. The Federal Reserve and the Treasury Department are making all the major strategic decisions in the financial sector and, with the rescue of the American International Group (AIG), the U.S. government now runs the world's biggest insurance company. At $700 billion, the biggest bailout since the Great Depression is being desperately cobbled together to save the global financial system. The usual explanations no longer suffice. Extraordinary events demand extraordinary explanations. But first... Is the worst over? No. If anything is clear from the contradictory moves of the last week - allowing Lehman Brothers to collapse while taking over AIG, and engineering Bank of America's takeover of Merrill Lynch - there's no strategy to deal with the crisis, just tactical responses. It's like the fire department's response to a conflagration. The $700 billion buyout of banks' bad mortgaged-backed securities is mainly a desperate effort to shore up confidence in the system, preventing the erosion of trust in the banks and other financial institutions and avoiding a massive bank run such as the one that triggered the Great Depression of 1929. Did greed cause the collapse of global capitalism's nerve center? Good old-fashioned greed certainly played a part. This is what Klaus Schwab, the organizer of the World Economic Forum, the yearly global elite jamboree in the Swiss Alps, meant when he said in an interview earlier this year: "We have to pay for the sins of the past." Was this a case of Wall Street outsmarting itself? Definitely. Financial speculators outsmarted themselves by creating more and more complex financial contracts like derivatives that would securitize and make money from all forms of risk - including such exotic futures instruments as "credit default swaps" that enable investors to bet on the odds that the banks' own corporate borrowers would not be able to pay their debts! This is the unregulated multi-trillion dollar trade that brought down AIG. On December 17, 2005, when International Financing Review (IFR) announced its 2005 Annual Awards - one of the securities industry's most prestigious awards programs - it had this to say: "[Lehman Brothers] not only maintained its overall market presence, but also led the charge into the preferred space by...developing new products and tailoring transactions to fit borrowers' needs...Lehman Brothers is the most innovative in the preferred space, just doing things you won't see elsewhere." No comment. Was it lack of regulation? Yes. Everyone acknowledges by now that Wall Street's capacity to innovate and turn out more and more sophisticated financial instruments had run far ahead of government's regulatory capability. This wasn't because the government was incapable of regulating but because the dominant neoliberal, laissez-faire attitude prevented government from devising effective regulatory mechanisms. But isn't there something more that is happening? We're seeing the intensification of one of the central crises or contradictions of global capitalism: the crisis of overproduction, also known as overaccumulation or overcapacity. In other words, capitalism has a tendency to build up tremendous productive capacity that outruns the population's capacity to consume owing to social inequalities that limit popular purchasing power, thus eroding profitability. But what does the crisis of overproduction have to do with recent events? Plenty. But to understand the connections, we must go back in time to the so-called Golden Age of Contemporary Capitalism, the period from 1945 to 1975. This was a time of rapid growth both in the center economies and in the underdeveloped economies - one that was partly triggered by the massive reconstruction of Europe and East Asia after the devastation of World War II, and partly by the new socio-economic arrangements institutionalized under the new Keynesian state. Key among the latter were strong state controls over market activity, aggressive use of fiscal and monetary policy to minimize inflation and recession, and a regime of relatively high wages to stimulate and maintain demand. So what went wrong? This period of high growth came to an end in the mid-1970s, when the center economies were seized by stagflation, meaning the coexistence of low growth with high inflation, which wasn't supposed to happen under neoclassical economics. Stagflation, however, was but a symptom of a deeper cause: the reconstruction of Germany and Japan and the rapid growth of industrializing economies like Brazil, Taiwan, and South Korea added tremendous new productive capacity and increased global competition. Meanwhile social inequality within countries and between countries globally limited the growth of purchasing power and demand, thus eroding profitability. The massive increase in the price of oil aggravated this trend in the 1970s. How did capitalism try to solve the crisis of overproduction? Capital tried three escape routes from the conundrum of overproduction: neoliberal restructuring, globalization, and financialization. What was neoliberal restructuring all about? Neoliberal restructuring took the form of Reaganism and Thatcherism in the North and structural adjustment in the South. The aim was to invigorate capital accumulation, and this was to be done by 1) removing state constraints on the growth, use, and flow of capital and wealth; and 2) redistributing income from the poor and middle classes to the rich on the theory that the rich would then be motivated to invest and reignite economic growth. This formula redistributed income to the rich and gutted the incomes of the poor and middle classes. It thus restricted demand while not necessarily inducing the rich to invest more in production. In fact, neoliberal restructuring, which was generalized in the North and South during the 1980s and 1990s, had a poor record in terms of growth: global growth averaged 1.1% in the 1990s and 1.4% in the 1980s, whereas it averaged 3.5% in the 1960s and 2.4% in the 1970s, when state interventionist policies were dominant. Neoliberal restructuring couldn't shake off stagnation. How was globalization a response to the crisis? The second escape route global capital took to counter stagnation was "extensive accumulation" or globalization. This was the rapid integration of semi-capitalist, non-capitalist, or precapitalist areas into the global market economy. Rosa Luxemburg, the famous German revolutionary economist, saw this long ago as necessary to shore up the rate of profit in the metropolitan economies: by gaining access to cheap labor, by gaining new, albeit limited, markets, by gaining new sources of cheap agricultural and raw material products, and by bringing into being new areas for investment in infrastructure. Integration is accomplished via trade liberalization, removing barriers to the mobility of global capital and abolishing barriers to foreign investment. China is, of course, the most prominent case of a non-capitalist area that was integrated into the global capitalist economy over the last 25 years. To counter their declining profits, many Fortune 500 corporations have moved a significant part of their operations to China to take advantage of the so-called "China Price" - the cost advantage of China's seemingly inexhaustible cheap labor. By the middle of the first decade of the 21st century, roughly 40-50% of the profits of U.S. corporations were derived from their operations and sales abroad, especially China. Why didn't globalization surmount the crisis? This escape route from stagnation has exacerbated the problem of overproduction because it adds to productive capacity. A tremendous amount of manufacturing capacity has been added in China over the last 25 years, and this has had a depressing effect on prices and profits. Not surprisingly, by around 1997, the profits of U.S. corporations stopped growing. According to one index, the profit rate of the Fortune 500 went from 7.15% in 1960-69 to 5.3% in 1980-90 to 2.29% in 1990-99 to 1.32% in 2000-2002. What about financialization? Given the limited gains in countering the depressive impact of overproduction via neoliberal restructuring and globalization, the third escape route became very critical for maintaining and raising profitability: financialization. In the ideal world of neoclassical economics, the financial system is the mechanism by which the savers or those with surplus funds are joined with the entrepreneurs who have need of their funds to invest in production. In the real world of late capitalism, with investment in industry and agriculture yielding low profits owing to overcapacity, large amounts of surplus funds are circulating and being invested and reinvested in the financial sector. The financial sector has thus turned on itself. The result is an increased bifurcation between a hyperactive financial economy and a stagnant real economy. As one financial executive notes, "there has been an increasing disconnect between the real and financial economies in the last few years. The real economy has grown...but nothing like that of the financial economy - until it imploded." What this observer doesn't tell us is that the disconnect between the real and the financial economy isn't accidental. The financial economy has exploded precisely to make up for the stagnation owing to overproduction of the real economy. What were the problems with financialization as an escape route? The problem with investing in financial sector operations is that it is tantamount to squeezing value out of already created value. It may create profit, yes, but it doesn't create new value. Only industry, agricultural, trade, and services create new value. Because profit is not based on value that is created, investment operations become very volatile and the prices of stocks, bonds, and other forms of investment can depart very radically from their real value. For instance, in the 1990s, prices of stock in Internet startups skyrocketed, driven mainly by upwardly spiraling financial valuations rooted in theoretical expectations of future profitability. Share prices crashed in 2000 and 2001 when this strategy got completely out of hand. Profits then depend on taking advantage of upward price departures from the value of commodities, then selling before reality enforces a "correction." Corrections are really a return to more realistic values. The radical rise of asset prices far beyond any credible value is what what fosters financial bubbles. Why is financialization so volatile? With profitability depending on speculative coups, it's not surprising that the finance sector lurches from one bubble to another, or from one speculative mania to another. And because it's driven by speculative mania, finance-driven capitalism has experienced scores of financial crises since capital markets were deregulated and liberalized in the 1980s. Prior to the current Wall Street meltdown, the most explosive of these were the string of emerging markets crises and the U.S.tech stock bubble's implosion in 2000 and 2001. The emerging markets crises primarily included the Mexican financial crisis of 1994-95, the Asian financial crisis of 1997-1998, the Russian financial crisis in 1998, and the Argentine financial collapse that occurred in 2001 and 2002, but they also rocked other countries including Brazil and Turkey. One of President Bill Clinton's Treasury Secretaries, Wall Streeter Robert Rubin, predicted five years ago that "future financial crises are almost surely inevitable and could be even more severe." How do bubbles form, grow, and burst? Let's first use the Asian financial crisis of 1997-98, as an example. First, capital account and financial liberalization took place Thailand and other countries at the urging of the International Monetary Fund (IMF) and the U.S. Treasury Department. Then came the entry of foreign funds seeking quick and high returns, meaning they went to real estate and the stock market. This overinvestment made stock and real estate prices fall, leading to the panicked withdrawal of funds. In 1997, $100 billion fled the East Asian economies over the course of just a few weeks. That capital flight led to an IMF bailout of foreign speculators. The resulting collapse of the real economy produced a recession throughout East Asia in 1998. Despite massive destabilization, international financial institutions opposed efforts to impose both national and global regulation of financial system on ideological grounds. What about the current bubble? How did it form? The current Wall Street collapse has its roots in the technology-stock bubble of the late 1990s, when the price of the stocks of Internet startups skyrocketed, then collapsed in 2000 and 2001, resulting in the loss of $7 trillion worth of assets and the recession of 2001-2002. The Fed's loose money policies under Alan Greenspan encouraged the technology bubble. When it collapsed into a recession, Greenspan, to try to counter a long recession, cut the prime rate to a 45-year low of one percent in June 2003 and kept it there for over a year. This had the effect of encouraging another bubble - in real estate. As early as 2002, progressive economists such as Dean Baker of the Center for Economic Policy Research were warning about the real estate bubble and the predictable severity of its impending collapse. However, as late as 2005, then-Council of Economic Adviser Chairman and now Federal Reserve Board Chairman Ben Bernanke attributed the rise in U.S. housing prices to "strong economic fundamentals" instead of speculative activity. Is it any wonder that he was caught completely off guard when the subprime mortgage crisis broke in the summer of 2007? And how did it grow? According to investor and philanthropist George Soros: "Mortgage institutions encouraged mortgage holders to refinance their mortgages and withdraw their excess equity. They lowered their lending standards and introduced new products, such as adjustable mortgages (ARMs), 'interest-only' mortgages, and promotional teaser rates." All this encouraged speculation in residential housing units. House prices started to rise in double-digit rates. This served to reinforce speculation, and the rise in house prices made the owners feel rich; the result was a consumption boom that has sustained the economy in recent years." The subprime mortgage crisis wasn't a case of supply outrunning real demand. The "demand" was largely fabricated by speculative mania on the part of developers and financiers that wanted to make great profits from their access to foreign money that has flooded the United States in the last decade. Big-ticket mortgages were aggressively sold to millions who could not normally afford them by offering low "teaser" interest rates that would later be readjusted to jack up payments from the new homeowners. But how could subprime mortgages going sour turn into such a big problem? Because these assets were then "securitized" with other assets into complex derivative products called "collateralized debt obligations" (CDOs). The mortgage originators worked with different layers of middlemen who understated risk so as to offload them as quickly as possible to other banks and institutional investors. These institutions in turn offloaded these securities onto other banks and foreign financial institutions. When the interest rates were raised on the subprime loans, adjustable mortgage, and other housing loans, the game was up. There are about six million subprime mortgages outstanding, 40% of which will likely go into default in the next two years, Soros estimates. And five million more defaults from adjustable rate mortgages and other "flexible loans" will occur over the next several years. These securities, the value of which run into the trillions of dollars, have already been injected, like virus, into the global financial system. But how could Wall Street titans collapse like a house of cards? For Lehman Brothers, Merrill Lynch, Fannie Mae, Freddie Mac, and Bear Stearns, the losses represented by these toxic securities simply overwhelmed their reserves and brought them down. And more are likely to fall once their books - since lots of these holdings are recorded "off the balance sheet" - are corrected to reflect their actual holdings. And many others will join them as other speculative operations such as credit cards and different varieties of risk insurance seize up. The American International Group (AIG) was felled by its massive exposure in the unregulated area of credit default swaps, derivatives that make it possible for investors to bet on the possibility that companies will default on repaying loans. According to Soros, such bets on credit defaults now make up a $45 trillion market that is entirely unregulated. It amounts to more than five times the total of the U.S. government bond market. The huge size of the assets that could go bad if AIG collapsed made Washington change its mind and intervene after it let Lehman Brothers collapse. What's going to happen now? There will be more bankruptcies and government takeovers. Wall Street's collapse will deepen and prolong the U.S. recession. This recession will translate into an Asian recession. After all, China's main foreign market is the United States, and China in turn imports raw materials and intermediate goods that it uses for its U.S. exports from Japan, Korea, and Southeast Asia. Globalization has made "decoupling" impossible. The United States, China, and East Asia in general are like three prisoners bound together in a chain-gang. In a nutshell...? The Wall Street meltdown is not only due to greed and to the lack of government regulation of a hyperactive sector. This collapse stems ultimately from the crisis of overproduction that has plagued global capitalism since the mid-1970s. The financialization of investment activity has been one of the escape routes from stagnation, the other two being neoliberal restructuring and globalization. With neoliberal restructuring and globalization providing limited relief, financialization became attractive as a mechanism to shore up profitability. But financialization has proven to be a dangerous road. It has led to speculative bubbles that produce temporary prosperity for a few but ultimately end up in corporate collapse and in recession in the real economy. The key questions now are: How deep and long will this recession be? Does the U.S. economy need another speculative bubble to drag itself out of this recession? And if it does, where will the next bubble form? Some people say the military-industrial complex or the "disaster capitalism complex" that Naomi Klein writes about will be the next bubble. But that's another story. Copyright © 2008, Institute for Policy Studies http://en.wikipedia.org/wiki/Too_big_to_fail Too big to fail From Wikipedia, the free encyclopedia This article is about a theory in economics. For the 2009 Andrew Ross Sorkin book, see Too Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial System—and Themselves. For the film based on the book, see Too Big to Fail (film). The "too big to fail" theory asserts that certain financial institutions are so large and so interconnected that their failure would be disastrous to the economy, and they therefore must be supported by government when they face difficulty. The colloquial term "too big to fail" was popularized by U.S. Congressman Stewart McKinney in a 1984 Congressional hearing, discussing the Federal Deposit Insurance Corporation's intervention with Continental Illinois.[1] The term had previously been used occasionally in the press.[2] Proponents of this theory believe that some institutions are so important that they should become recipients of beneficial financial and economic policies from governments or central banks.[3] Some economists such as Paul Krugman hold that economies of scale in banks and in other businesses are worth preserving, so long as they are well regulated in proportion to their economic clout, and therefore that "too big to fail" status can be acceptable. The global economic system must also deal with sovereign states being too big to fail.[4][5][6][7] Opponents believe that one of the problems that arises is moral hazard whereby a company that benefits from these protective policies will seek to profit by it, deliberately taking positions (see Asset allocation) that are high-risk high-return, as they are able to leverage these risks based on the policy preference they receive.[8] The term has emerged as prominent in public discourse since the 2007–2010 global financial crisis.[9] Critics see the policy as counterproductive and that large banks or other institutions should be left to fail if their risk management is not effective.[10][11] Some critics, such as Alan Greenspan, believe that such large organisations should be deliberately broken up: “If they’re too big to fail, they’re too big”.[12] More than fifty prominent economists, financial experts, bankers, finance industry groups, and banks themselves have called for breaking up large banks into smaller institutions.[13] In 2014, the International Monetary Fund and others said the problem still had not been dealt with.[14][15] While the individual components of the new regulation for systemically important banks (additional capital requirements, enhanced supervision and resolution regimes) likely reduced the prevalence of TBTF, the fact that there is a definite List of systemically important banks considered TBTF has a partly offsetting impact.[16] Definition Federal Reserve Chair Ben Bernanke also defined the term in 2010: "A too-big-to-fail firm is one whose size, complexity, interconnectedness, and critical functions are such that, should the firm go unexpectedly into liquidation, the rest of the financial system and the economy would face severe adverse consequences." He continued that: "Governments provide support to too-big-to-fail firms in a crisis not out of favoritism or particular concern for the management, owners, or creditors of the firm, but because they recognize that the consequences for the broader economy of allowing a disorderly failure greatly outweigh the costs of avoiding the failure in some way. Common means of avoiding failure include facilitating a merger, providing credit, or injecting government capital, all of which protect at least some creditors who otherwise would have suffered losses...If the crisis has a single lesson, it is that the too-big-to-fail problem must be solved."[17] Bernanke cited several risks with too-big-to-fail institutions:[17] These firms generate severe moral hazard: "If creditors believe that an institution will not be allowed to fail, they will not demand as much compensation for risks as they otherwise would, thus weakening market discipline; nor will they invest as many resources in monitoring the firm's risk-taking. As a result, too-big-to-fail firms will tend to take more risk than desirable, in the expectation that they will receive assistance if their bets go bad." It creates an uneven playing field between big and small firms. "This unfair competition, together with the incentive to grow that too-big-to-fail provides, increases risk and artificially raises the market share of too-big-to-fail firms, to the detriment of economic efficiency as well as financial stability." The firms themselves become major risks to overall financial stability, particularly in the absence of adequate resolution tools. Bernanke wrote: "The failure of Lehman Brothers and the near-failure of several other large, complex firms significantly worsened the crisis and the recession by disrupting financial markets, impeding credit flows, inducing sharp declines in asset prices, and hurting confidence. The failures of smaller, less interconnected firms, though certainly of significant concern, have not had substantial effects on the stability of the financial system as a whole."[17] http://billmoyers.com/episode/full-show-too-big-to-fail-and-getting-bigger/ http://network.nationalpost.com/np/blogs/fpcomment/archive/2008/09/29/bailout-marks-karl-marx-s-comeback.aspx Bailout marks Karl Marx's comeback Posted: September 29, 2008, 8:03 PM by Jeff White Martin Masse, mortgage crisis Marx’s Proposal Number Five seems to be the leading motivation for those backing the Wall Street bailout By Martin Masse In his Communist Manifesto, published in 1848, Karl Marx proposed 10 measures to be implemented after the proletariat takes power, with the aim of centralizing all instruments of production in the hands of the state. Proposal Number Five was to bring about the “centralization of credit in the banks of the state, by means of a national bank with state capital and an exclusive monopoly.” If he were to rise from the dead today, Marx might be delighted to discover that most economists and financial commentators, including many who claim to favour the free market, agree with him. Indeed, analysts at the Heritage and Cato Institute, and commentators in The Wall Street Journal and on this very blog, have made declarations in favour of the massive “injection of liquidities” engineered by central banks in recent months, the government takeover of giant financial institutions, as well as the still stalled US$700-billion bailout package. (Editor's Note: Scholars at the Cato Institute have not supported Washington’s $700-billion financial bailout plan. The National Post apologizes for the error.) Some of the same voices were calling for similar interventions following the burst of the dot-com bubble in 2001. “Whatever happened to the modern followers of my free-market opponents?” Marx would likely wonder. At first glance, anyone who understands economics can see that there is something wrong with this picture. The taxes that will need to be levied to finance this package may keep some firms alive, but they will siphon off capital, kill jobs and make businesses less productive elsewhere. Increasing the money supply is no different. It is an invisible tax that redistributes resources to debtors and those who made unwise investments. So why throw this sound free-market analysis overboard as soon as there is some downturn in the markets? The rationale for intervening always seems to centre on the fear of reliving the Great Depression. If we let too many institutions fail because of insolvency, we are being told, there is a risk of a general collapse of financial markets, with the subsequent drying up of credit and the catastrophic effects this would have on all sectors of production. This opinion, shared by Ben Bernanke, Henry Paulson and most of the right-wing political and financial establishments, is based on Milton Friedman’s thesis that the Fed aggravated the Depression by not pumping enough money into the financial system following the market crash of 1929. It sounds libertarian enough. The misguided policies of the Fed, a government creature, and bad government regulation are held responsible for the crisis. The need to respond to this emergency and keep markets running overrides concerns about taxing and inflating the money supply. This is supposed to contrast with the left-wing Keynesian approach, whose solutions are strangely very similar despite a different view of the causes. But there is another approach that doesn’t compromise with free-market principles and coherently explains why we constantly get into these bubble situations followed by a crash. It is centered on Marx’s Proposal Number Five: government control of capital. For decades, Austrian School economists have warned against the dire consequences of having a central banking system based on fiat money, money that is not grounded on any commodity like gold and can easily be manipulated. In addition to its obvious disadvantages (price inflation, debasement of the currency, etc.), easy credit and artificially low interest rates send wrong signals to investors and exacerbate business cycles. Not only is the central bank constantly creating money out of thin air, but the fractional reserve system allows financial institutions to increase credit many times over. When money creation is sustained, a financial bubble begins to feed on itself, higher prices allowing the owners of inflated titles to spend and borrow more, leading to more credit creation and to even higher prices. As prices get distorted, malinvestments, or investments that should not have been made under normal market conditions, accumulate. Despite this, financial institutions have an incentive to join this frenzy of irresponsible lending, or else they will lose market shares to competitors. With “liquidities” in overabundance, more and more risky decisions are made to increase yields and leveraging reaches dangerous levels. During that manic phase, everybody seems to believe that the boom will go on. Only the Austrians warn that it cannot last forever, as Friedrich Hayek and Ludwig von Mises did before the 1929 crash, and as their followers have done for the past several years. Now, what should be done when that pyramidal scheme starts crashing to the floor, because of a series of cascading failures or concern from the central bank that inflation is getting out of control? It’s obvious that credit will shrink, because everyone will want to get out of risky businesses, to call back loans and to put their money in safe places. Malinvestments have to be liquidated; prices have to come down to realistic levels; and resources stuck in unproductive uses have to be freed and moved to sectors that have real demand. Only then will capital again become available for productive investments. Friedmanites, who have no conception of malinvestments and never raise any issue with the boom, also cannot understand why it inevitably leads to a crash. They only see the drying up of credit and blame the Fed for not injecting massive enough amounts of liquidities to prevent it. But central banks and governments cannot transform unprofitable investments into profitable ones. They cannot force institutions to increase lending when they are so exposed. This is why calls for throwing more money at the problem are so totally misguided. Injections of liquidities started more than a year ago and have had no effect in preventing the situation from getting worse. Such measures can only delay the market correction and turn what should be a quick recession into a prolonged one. Friedman — who, contrary to popular perception, was not a foe of monetary inflation, but simply wanted to keep it under better control in normal circumstances — was wrong about the Fed not intervening during the Depression. It tried repeatedly to inflate but credit still went down for various reasons. This is a key difference in interpretation between the Austrian and Chicago schools. As Friedrich Hayek wrote in 1932, “Instead of furthering the inevitable liquidation of the maladjustments brought about by the boom during the last three years, all conceivable means have been used to prevent that readjustment from taking place; and one of these means, which has been repeatedly tried though without success, from the earliest to the most recent stages of depression, has been this deliberate policy of credit expansion. ... To combat the depression by a forced credit expansion is to attempt to cure the evil by the very means which brought it about ...” The confusion of Chicago school economics on monetary issues is so profound as to lead its adherents today to support the largest government grab of private capital in world history. By adding their voices to those on the left, these confused free-marketeers are not helping to “save capitalism”, but contributing to its destruction. Financial Post Martin Masse is publisher of the libertarian webzine Le Québécois Libre and a former advisor to Industry minister Maxime Bernier. Photo: Karl Marx Editor's Note: Scholars at the Cato Institute have not supported Washington’s $700-billion financial bailout plan. The wording of a sentence in Martin Masse’s September 30 commentary, “Karl’s Comeback,” mistakenly implied otherwise. The National Post apologizes for the error. Read more: http://network.nationalpost.com/np/blogs/fpcomment/archive/2008/09/29/bailout-marks-karl-marx-s-comeback.aspx#ixzz1PqPla4hM https://www.facebook.com/WorkingAmerica/photos/a.10150179024053118.326871.92021268117/10152556474333118/?type=1&theater Sometimes you have to translate what the banks are saying. http://bit.ly/1jFytQ8 Text JOBS to 30644 to join our fight for corporate accountability. (Graphic via The Blue Street Journal)

Is Human Nature Social or Selfish ?

original post :


http://take10charles.blogspot.com/2014/05/is-human-nature-social-or-selfish-i.html

Is Human Nature Social or Selfish ? by Charles D. Brown

I recently had a chance to teach anthropology for the first time, after a school career with two anthropology degrees. One student asked "what does anthropology matter ? what difference does it make ?". Good , mature questions for a high school student.

One way that anthropology might help us in the here and now is to bring scientific and biological paleontological evidence, from the Stone Age 100,000's of years ago, to bear on the question of what is human nature today ? Is it human nature to be greedy and selfish like Wall Street billionaires ? Or is it human nature to share and "love thy neighbor as thyself" ?

_Sapiens_" means "wise" In Latin.

Homo sapiens (Latin: "wise man"(sic) ) is the scientific name for the human species. Homo is the human genus, which also includes Neanderthals and many other extinct species of hominin. H. sapiens is the only surviving species of the genus Homo. Modern humans are the subspecies Homo sapiens sapiens, which differentiates us from Homo sapiens Neanderthal

What is humans' unique nature ? What are language/culture ?

For anthropology, language/ culture are the unique species characteristic of _homo sapiens_. In a sense, "culture" is another word for "wisdom", from the notion that humans are the species _homo wise_. It is humans socially learned practices, customs, language, traditions, beliefs, religion, spirituality that make us "wise" in so many ways, certainly clever and winners _as a species_ ( not just as a few "fit" Individuals) in the struggles and snuggles to survive as a species. Since the advent of civilization, sometimes it's not so clear how wise our culture makes us. Therein lies the central drama of the history of the human species. Nonetheless, clearly in the Stone Age, our having culture was a highly adaptive advantage over species that did not have culture , stone tools made through culture, etc, raising our species fitness. This is evidenced by _homo sapiens_ expanding in population and therefore migrating to an expanded area of living space across the earth , out of what is now Africa to the other continents. Stone Age foraging and kinship organized societies were the mode of life for the vast majority of time of human species 'existence, 99% or more.

The first human societies had an extraordinarily high survival need to be able to rely on each other at levels of solidarity that we cannot even imagine. The intensity of the network of social connections of a band of 25 to 150 ( maybe a bit more) people living in the ecological food chain location would almost constitute a new level of organic organization and integrity above individual bodies; ancient kinship/culture systems were super-organic bodies; the human social group was a substantially harmonious , multi-individual Body, organism ( pace Hobbes). The Individual human bodies, all of the Some Bodies , were very frail and weak relative to the field of predators they were escaping. Bi-pedal/ Up-right posture made them slower sprint runners than quadrupeds , too ! The dominance of the food chain that humans ultimately reached even in the Stone Age could be reached only by super-social , super internally-cooperative, super-intra-species harmony, because they had _frail_ individual bodies relative to their predators , and needed each other's support. It is clear to me that natural selection picked hominin groups with policies of "love thy neighbor as thyself " and "charity" over those that might have derived principles of "selfishness and greed", if there were any in the Stone Age before Civilization. Institutionalized war would have been selected against through the whole Stone Age. https://www.youtube.com/watch?v=Iq0XJCJ1Srw

Marxism 101

Charles Brown Wed Sep 9 13:45:01 PDT 1998

_The Manifesto of the Communist Party_ by Marx and Engels. _Capital_ by Marx, _The Origin of the Family, Private Property and the State, by Engels, _Capital_ by Marx, _The State and Revolution_ by Lenin, _Imperialism:The Highest Stage Capitalism, by Lenin, _What is to be done_ by Lenin, _The Teachings of Karl Marx, by Lenin.. More later Charles Brown Detroit Workers of the West , it's our turn.

Ancient southern Kalahari was more important to human evolution than previously thought Published: March 31, 2021

https://theconversation.com/ancient-southern-kalahari-was-more-important-to-human-evolution-than-previously-thought-155047

The Kalahari is a huge expanse of desert in southern Africa, stretching across Botswana and into the northernmost part of South Africa’s Northern Cape province.

It’s in the Northern Cape that we studied and described a new archaeological site, Ga-Mohana Hill, for research just published in Nature.

Our international team, made up of researchers from South Africa, Canada, the UK, Australia and Austria, has found evidence for complex symbolic behaviours 105,000 years ago.

Humans use symbols as a shortcut to communicate important ideas. Identifying the ancient roots of symbolism is limited to what preserves over time. Large calcite crystals from several kilometres away were found in the cave alongside stone tools. Why the crystals were brought there is unknown; they are not modified and do not seem to have a functional purpose. They may have been collected for their aesthetic properties, or included in ritual activities.

We bring the expertise of academics to the public.

About our team Crystals are collected by many people around the world to this day for ritual purposes. Early humans bringing crystals into Ga-Mohana suggests innovation in how people interacted with each other and their environment.

But such ancient innovation didn’t occur in a bubble: there is context to when and where innovation occurs. What brought people there in the first place, at that time, to begin using those tools and collecting those crystals?

Reconstructing past environments allows us to understand this context. And so, a major part of our research centred on working out what the area’s climate was like 105,000 years ago. To do so, we looked at Ga-Mohana’s rocks.

The southern Kalahari is often considered too arid to be important for human evolution. Our work contradicts the idea of an arid and empty interior. At some points, Ga-Mohana was much wetter than today, with pools of standing water and waterfalls tumbling down the hillside. The fact that the climate was very different then opens up possibilities about why this previously under-appreciated region must have played an important role in our species’ evolutionary history.

Provoking Beijing by b https://www.moonofalabama.org (July 28 2022) Yves Smith is aghast about the US eye-poking of China {1}: The neocons above all seem unable to process that the days of US hegemony are over. It boggles the mind that they are not just eye-poking but escalating greatly with China via the still-planned Pelosi visit to Taiwan in August. As we'll explain, China is fully cognizant of the fact that Pelosi is number two in line after Harris should something happen to the increasingly addle-brained Biden. And they don't buy for a second that Pelosi is operating without the explicit approval of the Administration. Note that it's entirely possible that Pelosi revived her Taiwan trip plan (recall she put it off after coming down with Covid) all on her own. The Pentagon gave her a face-saving out by saying they didn't recommend it. China, which is routinely screechy when it is upset about what it perceives to be foreign transgressions, has managed to find new registers in its objections the proposed Pelosi visit. Pelosi is not only number two in line but has been hostile to the Chinese government for more than 30 years. In 1991 she and two other members of Congress made a stunt on Tiananmen square where two years before protests had taken place. The multiday protest in the square had ended peacefully. But outside of the square bloody riots took place over several days and nights during which hundreds of soldiers and rioters got killed. The protest and riots had been a US-instigated color revolution attempt with the father of the color revolution concept, Gene Sharp, being personally in Beijing and consulting the protest leaders {2}. After the attempt had failed the CIA organized the exit of hundreds of protest leaders and agents to Hong Kong where they formed the base for the 2020 color revolution attempt there. Lots of those 'activists' have now moved to Taiwan. In 1991 Pelosi and two congressmen unfolded a banner on Tiananmen in front of the international media that said: "To those who died for democracy in China". Police immediately intervened and ended the stunt. https://www.moonofalabama.org/13i/pelosi1-s.jpg The stunt had a positive echo in US media {3} (Note: The video title says it is 1989 but the announcer says it is two years later). Pelosi may think she can recreate another positive media echo by traveling to Taiwan. But the China of 2022 is no longer the China of 1991. It is now the world's biggest economy {4} and its military force rivals the one the US has. It no longer condones eye-poking and 'human rights' stunts. It knows a US provocation when it sees one. In the 1950s and 1960s, the US financed terrorism in Tibet {5}. In 1989 it coached and financed a bloody color revolution attempt in Beijing. In the 1990s it brought Islamist terrorism to Xinjiang {6}. In this century the US instigated several periods of riots in Hong Kong. Here is Pelosi in October 2019 with the chief instigators of several Hong Kong riot periods. https://www.moonofalabama.org/13i/pelosi2-s.jpg The man on the left is Jimmy Lai {7}: Owing to the 1989 Tiananmen Square protests and massacre, Lai became an advocate of democracy and critic of the People's Republic of China government. He began publishing Next Magazine, which combined tabloid sensationalism with hard-hitting political and business reporting. He proceeded to found other magazines ... ... In 2003, ahead of the record-breaking pro-democracy protests in Hong Kong during July, the cover of Next Magazine featured a photo-montage of the territory's embattled chief executive Tung Chee-Hwa taking a pie in the face. The magazine urged readers to take to the streets while Apple Daily distributed stickers calling for Tung to resign. The CIA heavily financed Lai, who over the years financed the various Hong Kong protests, by sponsoring his media businesses in Taiwan. Tai was also involved in CIA meddling in Myanmar. The man on the right of Pelosi is the British colonial asset, Martin Lee {8}: Lee began his involvement in politics when the British and Chinese governments began their negotiations over Hong Kong's sovereignty in the early 1980s. Lee was in the delegation consisting of Hong Kong's young professionals led by Allen Lee, a member of the Executive and the Legislative Councils of Hong Kong in Beijing in May 1983. The delegation sought to maintain the status quo in Hong Kong and extend British rule by an additional 15 to 30 years. Their requests were turned down by Beijing officials. ... During the Tiananmen protests May and June 1989, Martin Lee was an outspoken supporter of the student movement for more democracy and freedom in China. ... In the massive pro-democracy Occupy protests from October to December 2014, he was among the pro-democracy activists staging a final sit-in and arrested, putting an end to a 75-day street occupation. Here is Pelosi with Hong Kong riots superstar Joshua Wong {9}. https://www.moonofalabama.org/13i/pelosi3-s.jpg Wong was arrested and held for three hours on Friday, 16 January 2015, for his alleged involvement in offences of calling for, inciting, and participating in an unauthorised assembly. The same month, an article appeared in the Pro-Beijing newspaper Wen Wei Po alleging that Wong had met with the US consul-general in Hong Kong Stephen M Young during the latter's visit in 2011. It suggested that Wong had links with the Central Intelligence Agency of the United States, ... ... Wong was then arrested again on 29 August 2019 the day before a planned demonstration, which was not given city approval. ... The Speaker of the House of Representatives, Nancy Pelosi, met with Wong on Capitol Hill in Washington, DC on 18 September. Chinese media sharply criticised Pelosi for this meeting, accusing her of "backing and encouraging radical activists". Anyone who thinks that China will allow, that Pelosi, to visit Taiwan, should think again. They would rather take her plane down. But note a pattern in those US bloody 'interventions'. Tibet is now a peaceful province of China, Beijing does well, and the Chinese people are happy with their government. Xinjiang is now the most visited tourist region {10} of the world and Hong Kong is under full Chinese control. The US is trying to push Taiwan to declare independence and to sucker China into some military reaction. It should take note of the fact that its other attempts to poke China have not ended well for its side. Yves says that China is ready to respond {11} should the planned Pelosi stunt take place: If the Chinese level of ire is any guide, having Chinese fighter jets deny Pelosi a landing in Taiwan is on the mild end of possible responses. If that were to happen and the plane was escorted to land in mainland China, I could see the Chinese rubbing salt in the wound by not letting anyone in the aircraft deplane. China is considering how to use a Pelosi visit to set far more important precedents. Hu in the Global Times clip above mentioned declaring a no-fly zone or having PLA jets fly with Pelosi's plane into Taiwan airspace. As the Global Times noted: "That would set a great precedent for the PLA to patrol above the island, which would be far more meaningful than Pelosi's visit". As with provoking Russia, the US may be about to get what it sought with Taiwan and find out that the results are not to its advantage. And as an American, it's depressing to see so much incompetence and arrogance on display. There is more incompetence and arrogance to come. Pelosi has now asked other lawmakers to join her on the trip {12}: House Speaker Nancy Pelosi (Democrat, California) has invited other members of Congress to join her in a visit to Taiwan next month, signaling that she still plans to make the trip despite the fact that the US military thinks it risks provoking China. Representative Michael McFaul (Republican, Texas), the top Republican on the House Foreign Affairs Committee, said Wednesday that Pelosi invited him and Representative Gregory Meeks (Democrat, New York), who chairs the committee. McFaul said he couldn't go to Taiwan due to a prior engagement but expressed support for the trip. "Any member that wants to go, should. It shows political deterrence to President Xi", he said. "But she should also pay attention to the military if it's going to cause a blowback and escalate things". The Pentagon had warned that the trip could mean serious trouble but it is now increasing that trouble potential by moving more forces into the area {13}: Officials told The Associated Press that if Pelosi goes to Taiwan - still an uncertainty - the military would increase its movement of forces and assets in the Indo-Pacific region. They declined to provide details, but said that fighter jets, ships, surveillance assets, and other military systems would likely be used to provide overlapping rings of protection for her flight to Taiwan and any time on the ground there. That is indeed the dumbest thing the Pentagon could do. More forces in the region mean more potential for a screw-up where one thing goes wrong and everything escalates into a bloody war: The biggest risk during Pelosi's trip is of some Chinese show of force "gone awry, or some type of accident that comes out of a demonstration of provocative action", said Mark Cozad, acting associate director of the International Security and Defense Policy Center at the Rand Corporation. "So it could be an air collision. It could be some sort of missile test, and, again, when you're doing those types of things, you know, there is always the possibility that something could go wrong." ... "It is very possible that ... our attempts to deter actually send a much different signal than the one we intend to send", Cozad said. "And so you get into ... some sort of an escalatory spiral, where our attempts to deter are actually seen as increasingly provocative and vice versa. And that can be a very dangerous dynamic." Yesterday China's foreign ministry spokesperson made it clear that China will not back down {14}: AFP: A US official said that if Pelosi goes to Taiwan, the military would increase its movement of forces in the Asia-Pacific, including fighter jets. What is your comment? Zhao Lijian: Perhaps you missed our briefings in the past few days. We have repeatedly made clear our firm opposition to Speaker Pelosi's potential visit to Taiwan. If the US side insists on making the visit and challenges China's red line, it will be met with resolute countermeasures. The US must bear all consequences arising thereof. President Joe Biden has refrained from stopping Pelosi's trip plans. Today he is supposed to call President Xi. The Chinese have not confirmed a call so it may not happen. Will Biden ask that Pelosi be allowed to visit Taiwan? If he does he surely will get a quite harsh response. Taiwan is part of China. This is by the way also the official position of the government in Taipei. But seen from Beijing that government is only that of a Chinese province and not one that is allowed to have an independent foreign policy. Any attempt to change that will see strong resistance from Beijing, if necessary by force. The US government is currently watching as its proxy force in Ukraine gets systematically dismantled by Russia which is destined to win that war. There is nothing that the US can do about that. Any conflict around Taiwan would have a similar outcome. Washington may think that would be a great opportunity to isolate China. But isolate from whom? It would be the US and its allies which would be most hurt by it while the much larger rest of the world would simply continue to work with China just as it does now with Russia. But with incompetence and arrogance ruling in Washington (and Brussels) one can no exclude that that is exactly their plan. Links: {1} https://www.nakedcapitalism.com/2022/07/one-china-eyepoking-too-far-biden-signals-us-not-backing-down-on-pelosi-taiwan-visit-as-china-promises-military-response.html {2} https://www.bmartin.cc/pubs/90sa/90sa_Sharp.pdf {3} https://www.youtube.com/watch?v=v2Z8-Woj1eA&t=3s {4} https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP) {5} https://smallwarsjournal.com/jrnl/art/cia-tibet-1957-1969 {6} https://orinocotribune.com/beijings-decades-long-policies-in-xinjiang-cia-interference-funding-of-separatist-and-terrorist-groups/ {7} https://en.wikipedia.org/wiki/Jimmy_Lai {8} https://en.wikipedia.org/wiki/Martin_Lee {9} https://en.wikipedia.org/wiki/Joshua_Wong {10} http://www.xinhuanet.com/english/2021-02/01/c_139713047.htm {11} https://www.nakedcapitalism.com/2022/07/one-china-eyepoking-too-far-biden-signals-us-not-backing-down-on-pelosi-taiwan-visit-as-china-promises-military-response.html {12} https://news.antiwar.com/2022/07/27/pelosi-invites-lawmakers-to-join-her-in-taiwan-as-military-prepares-for-her-trip/ {13} https://apnews.com/article/china-nancy-pelosi-taiwan-government-and-politics-30bb4a00c7fd0e41c16b6791da6ad4a0 {14} https://www.fmprc.gov.cn/eng/xwfw_665399/s2510_665401/202207/t20220727_10728854.html https://www.moonofalabama.org/2022/07/provoking-beijing.html https://billtotten.wordpress.com/ https://www.ashisuto.co.jp--- To unsubscribe: List help:

The Rape of Detroit by Republicans of The State of Michigan

original post at :http://take10charles.blogspot.com/2014/05/the-rape-of-detroit-by-state-of.html

Wednesday, May 7, 2014 The Rape of Detroit by Republicans of The State of Michigan

By Charles D. Brown

Here is a summary in rough timeline of the rough raping and pillaging of the People and City workers of Detroit by Wall Street, Snake Snyder and the Republicans of the State of Michigan who themselves were much more fiscally irresponsible than Detroit's elected officials:

Circa 2008 and 2009,

-The Wall Street banks are bailed out of insolvency by the People of the United States , including the federal tax payers of Detroit for trillions of dollars ( a trillion is a thousand billion; a billion is a thousand million). The Wall Streeters claim that the whole financial system is at risk , so even banks that are not insolvent are at risk and effectively bailed out of failure. Later some of these banks will force the bankruptcy of the City of Detroit and demand that they be paid instead of city workers, pensions and services. General Motors and Chrysler are bailed out of bankruptcy for tens of billions of dollars by the People of the US ,including Detroit taxpayers. -The State of Michigan is in serious fiscal crisis and irresponsibility due to what the media terms a "one state recession " in Michigan, GM and Chrysler failures ,etc. - President Obama and the US taxpayers , including Detroiters, bail out The State of Michigan with $7.8 billion (7.8 thousand million dollars)of Obama Stimulus. Meanwhile , ( and I do mean "mean") Republicans, including Michigan Republicans, are slandering Obama to beat the band for the much needed national Stimulus. Yet, be clear, at the same time,Michigan Republicans are hypocritically begging Obama for Stimulus money. -2010 : tea Republicans sweep Michigan state government offices in part by lying and slandering Obama for the Stimulus and Obamacare; Michigan voters are fooled big time and sweep in Republicans, including lying Snyder ,who runs not as a tea Republican; but then proceeds to carryout the tea party pirates' assault on working people including raping Detroit and passing a work-for -less law against unions. -2011; tea Republicans and Snyder juice up the Emergency Manager/ Wall Street Dictator law preparing to take over Detroit. The essence of the law is to insure payments of municipal bond debts to Wall Street bond creditors the top priority of the City's spending over anything else. It provides for the usurpation of the People's ,voted Charter law and elected officials' powers by an unelected dictator. It is literally taxation without representation. It violates the Michigan Constitution's provision against the legislature imposing local legislation on a City without a vote of the People of the city. Snake Snyder takes first steps in finding Detroit fiscally irresponsible. Refuses Councilmember JoAnn Watson's direct request to Snyder personally in a meeting with Snyder in his office to pay $220 million owed Detroit from a deal made by former Governor Snake Engler and Mayor Archer. Snyder's staff explicitly tells him in front of Watson that the State does owe Detroit the money. -2012: State escalates fraudulent accusations that Detroit is fiscally irresponsible and other such terms. The immediate budget deficit is only $ 200 million or so and would be balanced if the State would pay the $220 million it owes Detroit , not to mention share some of the $7.8 billion Obama Stimulus that the State itself was bailed out of its own fiscal irresponsibility with. Meanwhile , the yellow journalistic Detroit News and Free Press ( not to mention electronic media) start running headlines and editorials concerning Detroit's _long_ term debt, that is mostly owed in five, ten , 20 years, and do not constitute an immediate fiscal crisis , but nonetheless is lyingly portrayed as such by those rags and on television. Negro Mayor Bing is in on the whole conspiracy with Snake Snyder, MC'ing Snyder's inaugural; volunteering to be the Emergency Manager ( Snyder is laughing at the Negro behind his back on that); hiring the law firm , Miller Canfield, that had drafted the new draconian Dictator law for the State to "represent" Detroit's interests ( ha ha) in negotiating with Snyder on the takeover under the law with a "Consent" Agreement . while excluding Corporation Counsel Krystal Crittendon from the negotiations. The City Council "consents" to "Consent" Agreement in a 5 to 4 vote, with the threat of imposition of an Emergency Dictator, who can rape it of all its powers, like a gun to its head when it "consents". Under the coerced deal, fake boards,paid large salaries, are imposed over the City Council . Consultants , incompetent to evaluate city jobs, are hired at outrageous salaries to advise the fake state boards to cut City workers jobs and wages , with that money then paid to the incompetent consultants. Most are white , replacing mostly Black people. For example , one city worker was raped of $70,000 of sick pay from foregone use of sick days over 25 years which she would have collected upon retirement. That's just one worker. Negro mayor Bing generally runs the whole city's business and departments incompetently , such as restoring cuts to the budget that City Council had made in trying to balance the budget; not providing bus service;or fixing pubic lighting; spinning the health department and its money off to a private corporation without City Council approval; publically going shopping on the east coast with Karen Dumas, press secretary and chief of staff, etc. ;so that Snyder will have an excuse to takeover the City as people are rightly protesting poor services. On Mildred Gaddis' WCHB radio talk show, State Treasurer Andy Dillon admits that the State of Michigan owes Detroit the $220 million plus that would take it out of deficit for that year and prevent the State from taking over for at least another year. But the State doesn't pay the money. In fact, at one point the State prevents the City from getting the money from another loan of tens of millions that would further delay the basis for it taking over immediately. ( http://www.clickondetroit.com/money/4yourmoney/A-major-twist-in-a-lot-of-Detroit-wrong-turns/7633150) The State runs a $1 billion "surplus" itself, which it would not have without the Obama $7.8 billion bailout ,but the State shares none of that with Detroit. Detroit Corporation Counsel, Krystal Crittendon , asserts that the City of Detroit may not enter into the Consent Agreement with the State because of a state law and the City Charter because the State owes Detroit $220 million. Negro Mayor Bing sends Miller Canfield to oppose his Corporation Counsel's lawsuit against the "Consent" Agreement. The People of Michigan repeal the Emergency Dictator Law in a statewide ( not just Detroit) referendum ! State law had required the Dictator law to be suspended and therefore it should not have continued in being used to rape Detroit during the election process. But Snyder illegally ignored this and continued the rape of Detroit. Then after the law was repealed by the People, Snyder , the Republican legislature and lying Republican State Court of Appeals enacted in violation of the will of their Bosses in a DEMOCRACY, the People, a law with the essential same provision of for imposition of an unelected Dictator, lying that the new law was different than the old law in that essential provision. 2013 State continues the fraudulent takeover of Detroit forcing the City Council to recant on several small acts of resistance: refusing to hire Miller Canfield to represent the City's interests against the takeover ( ha ha ha), refusing to fire Corporation Counsel Krystal Crittendon, refusing to giveaway Belle Isle in a deal completely onesided to the State's interests. The City Council reverses itself on all these issues. It delays for a couple of weeks finishing the giveaway of Belle Isle and Snake Snyder in fake indignation uses that as an excuse to rape the City further by imposing a Wall Street Dictator. The person Snake Snyder imposes as dictator is literally a Wall Street lawyer . The dictator fires city workers further , makes more cuts to wages, drastically cuts retirees' healthcare benefits. He takes the City into bankruptcy without a vote of the City Council; and forces the City to hire his law firm for tens of millions of dollars to represent the City. The claims in part are that the City $18 billion in debt. Of course most of that is not due to be paid for 5, 10, 15 years. $6 billion of it is owed by the Water Department, which has secure payments from its customers with no danger of it not being paid. Snake Snyder and the Wall Street dictator take the retirees' pensions into bankruptcy , admitting under oath, that they had the power not to take them in to be threatened with being cut. Thereby he has put in jeopardy billions of dollars in payments in wages, benefits and pensions to city workers and retirees, to be stolen and given to fabulously rich Wall Street bankers , including in bonuses and golden parachutes even when they had run the banks into the most spectacular bankruptcy in the history of the world ( no exaggeration) from which they were bailed out by the American taxpayers including Detroit city workers and pensioners. One critical focused point: Snake Snyder the Thief and Wall Street shill could have bailed Detroit out of its deficit with money the State rightfully owed Detroit, and some of the $ 7.8 billion the State itself was bailed out of it's own bankruptcy by Obama and the American taxpayers, including Detroiters, AND MONEY DETROITERS PAY DIRECTLY TO THE STATE IN TAXES. WHAT DO DETROITERS GET FROM THE STATE OF MICHIGAN FOR ALL THE TAXES WE PAY THEM ALL THESE YEARS. NOT A DAMN THING Randa Morris: It has nothing to do with fiscal responsibility. It's 100 percent political and the 1 percent getting richer from it, that's only the butter on the bread. This will happen in all areas that vote dem in Michigan. EM will happen in all areas of MI that traditionally vote dem. Elected officials will be replaced with right wing puppets who will then pave the way for the robbery of the people. http://www.nakedcapitalism.com/2012/08/wall-streets-war-against-the-cities-why-bondholders-cant-and-shouldnt-be-paid.html http://www.workers.org/2011/us/banks_destroyed_detroit_0407/ http://peoplesworld.org/state-takeovers-of-cities-and-schools-are-un-american/ Woodward Avenue, North of the Fisher Fwy, after a Tiger game... when I say plenty, I mean plenty of drinkin goes on in public, and no one gets ticketed or hassled by police, City or State... But on Belle Isle, where the State of Michigan has seized control as part of a sweetheart deal between Snake Snyder and his appointed Dictator over Detroit, is another story.... another example of the Tale of Two Cities. https://www.facebook.com/wxyzdetroit/photos/a.461583946134.248530.80221381134/10152062792691135/?type=1&theater Jewett McCrae Conspiracy indeed! Dave Bing and many others were right in step from the jump, never even trying to manage the City or its departments, he was only a figure head to speak from the script and follow the plan, The City of Detroit helped his Republican butt many times over the years, from purchasing supplies from Bing Steel to Loans from City Employees Penion, his first full term he tried to turn the Penion system over to the state, I do believe the bill in Lansing was sponsored by Mr Cushionberry himself! It was a topic on Mildred show once. They played the people on every front, knowing who would fall for what, and when, so when they their preferred people were in place. And our major news media outlets were never gonna be a problem. And too many people watch & listen to these half or any truth, distortion of facts news outlets Religiously! Victory on Defeat by Shields Green APRIL is the cruellest month, breeding Lilacs out of the dead land, mixing Memory and desire, stirring Dull roots with spring rain Detroit has been crucified, but Detroit will have resurrection. The Black Sun always rises. White demons are possessing the Souls of Black Folk. The question of the colorline is the question of the 21st Century as it was of the 20th. Workers are disunited on the colorline. The Barbarian hordes have breached the City 's gates. They will rape Black women again on Jefferson Avenue like Jefferson did. The bourgeois prince's savages will pillage and rape our Black Beautiful Detroit. May Day will come again Detroit survives despite economic sanctions, blockades , disinvestments What would Coleman Young do ? Smiles ! Put Victory on Defeat ! ^^^^^^^^^^^ May 25 , 2014 followup articles and events "Changes" ? Like what ? Big businesses invest in Flint ? State gives Flint more of its state tax money back ? Editorial: Without changes, the state is setting up more cities to fail http://www.freep.com/comments/article/20140525/OPINION01/305250057/michigan-emergency-manager Blast from the past: Labor Power Blogger: My purpose is to demonstrate, if it is true, that the State of Michigan is more fiscally irresponsible than the City of Detroit by the standards of "long term debt" that is now in the newspaper headlines. I want to argue that in dealing with deficits in the last several years, Michigan essentially bailed itself out with federal moneys especially the 3.8 billion (7.8 billion; 3.8 billion reported here) of Obama Stimulus money and also the well known 220 plus million in federal revenue sharing money that Engler promised in the deal with Archer. http://www.crainsdetroit.com/article/20090518/FREE/905189987/michigan-gets-more-than-3-8-billion-in-federal-stimulus-funds&template=printart https://www.youtube.com/watch?v=5yel6yuVHzs From JOURNALIST ACTIVIST TANGELA HARRIS: https://www.facebook.com/notes/information-detroit-ii/the-andy-dillion-meeting-with-joann-watson-and-tom-barrow/466281103507952 The ANDY DILLION meeting with JOANN WATSON and TOM BARROW June 2, 2014 at 2:02pm DETROIT BANKRUPTCY The ANDY DILLION meeting with JOANN WATSON and TOM BARROW March 4, 2013 Important information about Detroit and the bankruptcy The Andy Dillion meeting with Joann Watson and Tom Barrow reveals the reason why Detroit was placed in bankruptcy by Governor Snyder. The meeting provides an insight into the planning by Governor Snyder and Andy Dillion for the Emergency Manager and the Bankruptcy filling in Detroit. THE MEETING On Monday, March 4, 2013, Michigan State Treasurer, Andy Dillon, acting on behalf of Governor Snyder, summoned each member of the Detroit City Council to one-on-one private meetings. Each Council member was allotted 30 minutes to name four “sacred” things that they did not want the EFM “to touch” in return for their cooperation with a state appointed Emergency Financial Manager (“EFM”). DETROIT CITY COUNCIL MEMBERS City Council leaders Charles Pugh and Gary Brown went together and of those who went at all to their meeting did so alone and without benefit of staff or advisers. Recognizing that such a meeting with the State Treasurer was of great importance to the City, the Honorable JoAnn Watson enlisted Citizens for Detroit’s Future’s President, Tom Barrow, an expert in municipal finance and accounting, and asked that he accompany her to query the Treasurer on her behalf. The Treasurer was informed by Ms. Watson that she would attend and will have someone with her. No names were mentioned and her meeting was set to be the last of the gatherings. DETROIT CITY COUNCIL MEMBER INVITES AN EXPERT IN FINANCE Upon arrival, Councilwoman Watson and Barrow were greeted by Andy Dillon, Treasurer of the State of Michigan. Councilwoman Watson explained that Barrow was her adviser in this matter. Treasurer Dillon proceeded to explain that the purpose of the meeting was to seek Councilwoman Watson’s support for the EFM asking what four things she would like to go untouched by the EFM in return for her cooperation. JOANN WATSON ASK ANDY DILLION ABOUT THE MONEY THE STATE OWES TO DETROIT Barrow was never so proud to be a Detroiter then at that meeting as he watched Councilwoman Watson refuse the bait in every form in which it was advanced. Councilwoman Watson then proceeded to ask for the money owed to the City of Detroit by the state under and agreement between the Archer Administration and then-Governor John Engler to hold Detroit’s State Revenue Sharing constant in exchange for Detroit’s promise to lower its personal and corporate income tax rates (which Detroit did). ANDY DILLION REFUSES TO PAY WHAT IS OWED TO THE CITY OF DETROIT! Mr. Dillon dismissively retorted said that that agreement was “not enforceable”, to which Barrow explained that “oral contracts are enforced everyday and this one is in compelling need of such enforcement” except that in this circumstance the city’s Mayor simply lacks the will to seek such enforcement. TOM BARROW QUESTIONS ANDY DILLION When Ms. Watson then invited Barrow to initiate her more specific and technical line of inquiry, Barrow began by asking for specificity to his queries on behalf of the Councilwoman. The following is a paraphrasing of that exchange. Treasurer Dillon’s tone, inflection and manner made it exceedingly clear that Detroit will have an EFM appointed and that actually any appeal would be futile as the railroad is already running. TOM BARROW QUESTIONS ANDY DILLION Barrow began by asking what the basis was for the EFM and was told it was “to correct the balance sheet” and “the long-term legacy debt”. Stating that his response was vague, Barrow asked exactly what that meant and whether he was speaking of the city’s “$12 billion debt” referred to in news media accounts, which Dillon confirmed. ANDY DILLION ANSWERS THE QUESTIONS Using a standard finance technique, Barrow then proceeded to parse that debt seeking specificity, asking on behalf of the Councilwoman whether the EFM intended to renegotiate the Bond Debt currently being held by the banks. The Treasurer explained that that was not the reasoning, in short, “No”. Puzzled, Barrow then asked if the EFM would be renegotiating the Revenue Bonds securing the Water Department’s Sewerage Fund and was again told “No”. He then asked would the EFM be renegotiating the Revenue Bonds securing the Water Fund itself and was told “No”. ANDY DILLION BACKED INTO CORNER..MORE TRUTH IS COMING OUT After explaining that was the entire city’s formal long-term debt, Barrow asked if the state was really concerned about the future pension costs and Dillon confirmed that the purpose of the EFM was to cut the city’s future health and pension costs. Astonished, Barrow stated that future costs do not put Detroit in a “Financial Emergency” today and asked why state officials had not made this stated real purpose clear so that the Mayor and Council would approach city workers and retirees respectfully and negotiate a solution. The Treasurer sat quietly and did not respond. ANDY DILLION AVOID ANSWERING THE QUESTIONS The Treasurer then proceeded to present the “Financial Review Report” and explain that General Fund borrowings in the past were revenues in the General Fund. Barrow explained that Long-Term borrowings can never be revenues in a municipality’s or a School District’s General Fund. Rather, such Debt over a period of years is properly accounted for in the Long term Debt Group of Accounts, referred to as the Debt Service Fund. ANDY DILLION CONTINUES TO AVOID THE QUESTION The Treasurer repeated his claim and Barrow emphatically disagreed that such accounting treatment by the state is improper under Governmental Accounting Rules. Barrow proceeded to explain that Long-Term borrowings are only depicted in a General Fund’s analysis of “Sources and Uses” in reconciling the General Fund’s Fund Balance so as to effectuate a debt defeasment (pay off prior city losses by issuing Long-Term debt). Barrow explained that such borrowing is never revenue of a General Fund according to Governmental Accounting Standards. The Treasurer disagreed. REFERENCE SUPPORTS TOM BARROW'S QUESTIONS [Note: Please refer to Page 43 f the City's 2010 Comprehensive Annual Financial Report certified by KPMG wherein Long-Term Bonds were issued to defease prior period's deficits. In that report, the City of Detroit issued $251 million of "deficit defeasement bonds". In the Revenue Section note that there is NO revenue from a Bond Issuance as Dillon treats it. Also note that in the "Other Financing Sources (Uses)" Section, where the General Fund Fund Balance is reconciled, "Sources" include the $251 million to defease the General Fund deficit]. THE CITY OF DETROIT HAS PAID BILLS ON TIME, SAYS ANDY DILLION Councilwoman Watson then asked and the Treasurer confirmed that the City of Detroit has not missed any bond principal payments; has not missed any bond interest payments; has not missed a payroll; and has not failed to pay any obligation. The Treasurer also agreed that all of that was true. THERE IS NO SHORT TERM CRISIS! Finally, the discussion turned to current cash requirements as that is the stated reasoning for a state takeover. Barrow asked about the $137 million borrowed in November 2012 explaining that in the 2012 Audited Financial Statement’s “Subsequent Events” footnote, $79.5 million went immediately to defease the prior year’s short-term tax anticipation notes leaving $60 million of tax anticipation notes in the state’s bank account and held on behalf of the City of Detroit. Barrow’s unstated reasoning was to determine whether there was a short-term cash crisis necessitating a “Financial Emergency”. ANDY DILLION ADMITS THE CITY HAS CASH! Barrow then queried the Treasurer as to how much of the remaining $60 million has the city drawn upon since November 2012 and was told none…ZERO! This admission alone made it clear that the City has adequate operating cash. He then informed the Treasurer that the KPMG audited financial statement’s footnotes revealed that Detroit had a $66.5 million reduction in state revenue sharing last year as a result of the state’s prior depressed economy but that the current economy has improved dramatically and that revenue sharing would be expected to increase in the 2013-2014 fiscal period and Mr. Dillon agreed. Barrow further indicated that such increased state revenue sharing would increase the 2013-2014 fiscal period’s cash flows. The Treasurer also agreed. The Treasurer further agreed that the city’s General Fund has had operating surpluses for a number of years except for “Transfers Out”. DETROIT DEPARTMENT OF TRANSPORTATION Based on these revelations, the discussion turned to the city’s “Transfers Out” as shown in the General Fund [which drains the General Funds excess revenues] in an effort to determine which transfers an EFM will address that the city itself could not. The Treasurer indicated that it will be the subsidy to the City’s Transportation (D-DOT) and Lighting Departments (Public Lighting). After explaining that D-DOT is not intended to make a profit but provide a needed service, it was clear that a decision had implicitly been made to transfer D-DOT to the recently created Regional Transportation Authority effectively removing all revenue and superintending control from the City of Detroit. THE REVIEW TEAM ASSIGNED BY GOVERNOR SNYDER With the allotted half hour up, Barrow then told the Treasurer, in no ambiguous terms, that in his opinion, the review teams’ accounting was flawed, that a city meeting its obligations makes no clear case for a “Financial Emergency” or an abrogation of a city’s democracy rendering its elected officials powerless. CONCLUSION Afterwards, Barrow reviewed the meeting with Councilwoman Watson and explained that he was now convinced, more than ever, that by misusing accounting rules and using flawed reasoning, the “financial emergency” is contrived so as to enable an appointed Detroit EFM to privatize the city’s bus system; to privatize the city’s public lighting system; to bust the city’s unions by privatizing clear city functions and thereby lay-off Detroit’s work force destroying thousands of city households under the phony guise of right-sizing. Moreover, State officials, without informing the duly and democratically elected officials of the City of Detroit of the real reason, seek to impose upon current workers and pensioners changes in health care and benefits to their detriment even as the City has already taken its one-time losses by getting out of the “credit swaps” and “derivative” markets (the financial instruments that caused the mortgage crisis). STATE TAKE OVER BY GOVERNOR SNYDER Finally, the fact that $60 million of the $137 million of tax anticipation notes remains unused as of today, March 6, 2013, and without factoring in hundreds of millions of dollars in uncollected business and property taxes and million of dollars in television rights from sporting venues due to the City by entities which are fully collectible and by not factoring in anticipated increases in State Revenue Sharing, makes clear that the City of Detroit indeed has no immediate justification for a crisis and makes the need for a state takeover a well-orchestrated contrivance. In Brief New Report Values Detroit Institute of Arts Collection at $4.6 Billion by Mostafa Heddaya on July 9, 2014 3 One of Diego Rivera's "Detroit Industry Murals" at the Detroit Institute of Arts (1932–33) (photo by Flickr user cdshock) One of Diego Rivera’s “Detroit Industry Murals” at the Detroit Institute of Arts (1932–33) (photo by cdshock/Flickr) A new valuation of the 66,000-item collection of the Detroit Institute of Arts (DIA) has found it to be worth between $2.8 and $4.6 billion, the Detroit Free Press reported. However, the assessment, carried out by New York–based Artvest Partners at the behest of the City of Detroit, cautions that a forced sale of the collection would only realize a fraction of its value, netting an estimated low of $1.1 billion. The report further warns against the financial alternatives recommended in the previous valuation, carried out by Christie’s auction house last year, which suggested the collection could be used as debt collateral, among other possibilities. The Christie’s report appraised the city-owned portion of the collection, comprising 2,773 artworks, at $454–867 million. A spokesman for Detroit Emergency Manager Kevyn Orr told the Free Press that the conclusions of the Artvest report question the practicality of recent creditor demands to reconsider the value of the collection, with an eye to liquidation. “It’s one thing to say in the abstract that the art is worth billions, but it’s another thing if you look at the factors if you actually tried to sell it,” the spokesman said. According to the Free Press, which was provided with a copy of the not-yet-public report, Artvest — a “financially-focused art advisory firm” — was paid $112,500 for the assessment, and its staff will be remunerated as expert witnesses at trial or depositions at $6,000 per day, with the expense split between DIA and the city. cb at 9:48 AM

Heidegger