Putin’s speech at the Eastern Economic Forum

September 07, 2022

President of Russia Vladimir Putin: Friends, Mr Min Aung Hlaing, Mr Pashinyan, Mr Oyun-Erdene, Mr Li Zhanshu, ladies and gentlemen,

I am delighted to greet all participants and guests of the Eastern Economic Forum. Russia and Vladivostok are again hosting a forum of business leaders, experts, politicians, public figures and members of government from dozens of countries across the world.

As per tradition, the programme of the Eastern Economic Forum includes discussions on the projects and initiatives that are extremely important for the development of the regions in Russia’s Far East and for strengthening Russia’s cooperation and production ties with Asia Pacific countries, both our old, traditional partners and countries that are only developing dialogue with Russia in a broad range of areas and business projects.

Of course, this meeting in Vladivostok is a good opportunity to once again review the situation in the global economy and to exchange views on its main trends and risks.

Last year, the Eastern Economic Forum was held after a long pause caused by the coronavirus pandemic. At that time, the majority of experts agreed that global business activity was beginning to recover and that it would normalise soon after the lifting of the coronavirus restrictions, However, the pandemic has given way to new challenges, global ones that are threatening the world as a whole. I am referring to the Western sanctions frenzy and the open and aggressive attempts to force the Western mode of behaviour on other countries, to extinguish their sovereignty and to bend them to its will. In fact, there is nothing unusual in that: this policy has been pursued by the “collective West” for decades.

The waning dominance of the United States in the global economy and politics, as well as the stubborn unwillingness or even inability of the Western elites to see, let alone recognise objective facts, acted as a catalyst for these processes.

I have already mentioned that the entire system of international relations has recently undergone irreversible, or should I say, tectonic, shifts. Emerging states and regions around the world, primarily, of course, in the Asia-Pacific region, now play a substantially bigger role. Asia-Pacific countries emerged as new centres of economic and technological growth, attracting human resources, capital and manufacturing.

Despite all that, the Western countries are seeking to preserve yesterday’s world order that benefits them and force everyone to live according to the infamous “rules”, which they concocted themselves. They are also the ones who regularly violate these rules, changing them to suit their agenda depending on how things are going at any given moment. At the same time, other countries have not been forthcoming when it comes to subjecting themselves to this dictate and arbitrary rule, forcing the Western elites, to put it bluntly, to lose grip and take short-sighted, irrational decisions on global security, politics, as well as economics. All these decisions run counter to the interests of countries and their people, including, by the way, the people in those Western countries. The gap separating the Western elites from their own citizens is widening.

Europe is about to throw its achievements in building up its manufacturing capability, the quality of life of its people and socioeconomic stability into the sanctions furnace, depleting its potential, as directed by Washington for the sake of the infamous Euro-Atlantic unity. In fact, this amounts to sacrifices in the name of preserving the dominance of the United States in global affairs.

Back in spring, many foreign corporations rushed to announce their withdrawal from Russia, believing that our country will suffer more than others. Today, we see one manufacturing site after another shutting down in Europe itself. One of the key reasons, of course, lies in the severed business ties with Russia.

The competitive ability of European companies is in decline, for the EU officials themselves are essentially cutting them off from affordable commodities and energy, as well as trade markets. It will come as no surprise if eventually the niches currently occupied by European businesses, both on the continent and on the global market in general, will be taken over by their American patrons who know no boundaries or hesitation when it comes to pursuing their interests and achieving their goals.

More than that, in an attempt to obstruct the course of history, Western countries have undermined the pillars of the global economic system, built over centuries. It is in front of our eyes that the dollar, euro and pound sterling have lost trust as currencies suitable for performing transactions, storing reserves and denominating assets. We are taking steps to shed this dependence on unreliable and compromised foreign currencies. By the way, even allies of the United States are gradually reducing their dollar assets, as we can see from statistics. Step by step, the volume of transactions and savings in dollars is diminishing.

I want to note here that yesterday, Gazprom and its Chinese partners decided to switch to 50/50 transactions in rubles and yuan with respect to gas payments.

I want to add that with their short-sighted actions, Western officials have triggered a global inflation. In many developed economies, the inflation rate has reached a record-high level that had not been seen in many years.

Everybody is aware of this but I will reiterate: as of late July, inflation in the United States reached 8.5 percent. Russia has just over 14 percent (I will speak about this further) but it is declining, unlike in Western economies. The inflation there is on the rise, and in our country it is declining. I believe that as of the end of the year, we will have around 12 percent and, as many of our experts think, in the first quarter or by the second quarter of 2023, we will most likely reach the target inflation rate. Some say it will be 5–6 percent. Others say it will go down to 4 percent. We will see. In any case, the trend is positive. Meanwhile, what is happening with our neighbours? The inflation in Germany has reached 7.9 percent, in Belgium 9.9 percent, in the Netherlands 12 percent, Latvia 20.8 percent, Lithuania 21.1 percent and Estonia 25.2 percent. And it is still on the rise.

Rising prices in the global markets can be a real tragedy for most of the poorest countries, which are facing shortages of food, energy, and other vital goods. I will cite a few figures that underline the danger: while in 2019, according to the UN, 135 million people in the world were facing acute food insecurity, their number has soared by 2.5 times to 345 million by now – this is just horrible. Moreover, the poorest states have completely lost access to the most essential foods as developed countries are buying up the entire supply, causing a sharp increase in prices.

Let me give you an example. Most of the ships – you all know very well how high passions have been running, how much has been said about the need to facilitate the export of Ukrainian grain at all costs, to support the poorest countries. And we certainly had no other choice but to respond, despite all the complicated developments taking place around Ukraine. We did everything to ensure that Ukrainian grain was exported, and we certainly assumed – I met with the leaders of the African Union, with the leaders of African states and I promised them that we would make every effort to uphold their interests and would facilitate the export of Ukrainian grain.

Russia did it together with Turkiye. We did it. And I would like to report the result to you, colleagues: if we exclude Turkiye as an intermediary, all the grain exported from Ukraine, almost in its entirety, went to the European Union, not to the developing and poorest countries. Only two ships delivered grain under the UN World Food Programme – the very programme that is supposed to help countries that need help the most – only two ships out of 87 – I emphasise – transported 60,000 tonnes out of 2 million tonnes of food. That’s just 3 percent, and it went to the developing countries.

What I am saying is, many European countries today continue to act as colonisers, exactly as they have been doing in previous decades and centuries. Developing countries have simply been cheated yet again and continue to be cheated.

It is obvious that with this approach, the scale of food problems in the world will only increase. Unfortunately, to our great regret, this could lead to an unprecedented humanitarian disaster, and perhaps, exporters need to think about limiting their exports of grain and other food to this destination. I will certainly consult with President of Turkiye, Mr Erdogan, because together with him we were the ones who developed a mechanism for the export of Ukrainian grain, primarily, I repeat, to help the poorest countries. But what happened in practice?

I would like to stress once again that this situation has been caused by the reckless steps taken by the United States, the UK and the European Union, which are obsessed with illusory political ideas. As for the wellbeing of their own citizens, let alone people outside the so-called golden billion, they have been pushing it to the backburner. This will inevitably lead Western countries into a deadlock, an economic and social crisis, and will have unpredictable consequences for the whole world.

Colleagues,

Russia is coping well with the economic, financial and technological aggression of the West. I am talking about a real aggression; there is no other word for it. Russia’s currency and financial market has stabilised, inflation is going down, as I have already mentioned, and the unemployment rate is at an all-time historical low of less than 4 percent. The assessments and forecasts of our economic performance, including by businesspeople, are more optimistic now than in early spring.

I would like to say that our economic situation has stabilised overall, but we also see a number of problems in some sectors, regions and individual enterprises, especially those that relied on supplies from Europe or supplied their products there.

It is important to continue working with businesses to take prompt decisions and launch effective targeted support mechanisms. I would like to ask the Government Commission to Increase the Sustainability of the Russian Economy under the Sanctions to keep track of the situation. It is true that we are doing this almost on a daily basis. Nevertheless, despite the evidence of stabilisation I have mentioned, we are also aware of the risks and so we must keep an eye on them.

Russia is a sovereign state. We will always protect our national interests while pursuing an independent policy, and we also appreciate this quality among our partners, who have demonstrated their reliability and responsible attitude in the course of our trade, investment and other types of cooperation over many years. I am referring, as you are aware, to our colleagues from the Asia Pacific countries.

An absolute majority of Asia Pacific countries reject the destructive logic of sanctions. Their business relations are focused on mutual advantage, cooperation and the joint use of our economic capabilities to the benefit of our countries’ citizens. This adds up to a huge competitive advantage of the regional countries and a guarantee of their dynamic long-term development, which has been growing faster than the world’s average for a long time.

You are aware of this, but I would like to remind everyone that over the past 10 years Asian countries’ GDP has been increasing by approximately 5 percent every year, while the figure is 3 percent in the world, 2 percent in the US and 1.2 percent in the EU. But it is even more important that this trend persists. What will this ultimately lead to? As a result, the share of Asian economies in global GDP will grow from 37.1 percent in 2015 to 45 percent in 2027, and I am sure that this trend will persist.

It is important for Russia that the economy of the Russian Far East grows together with Asia Pacific economies, that this region provide modern living conditions, boost people’s incomes and well-being, and that it create high-quality jobs and cost-effective production facilities.

We have already tested unique national tax, administrative and customs privileges in the Far East. They help implement landmark projects, even by global standards, in such fields as natural gas conversion and the shipbuilding sector, bioengineering technologies and clean energy.

In the past seven years, industrial production volumes in the Far East have increased by about 25 percent. This exceeds nationwide levels by one third. I want to stress this: growth rates of industrial production in the Far East greatly exceed similar nationwide growth rates.

We will continue to promote the priority development of the Far Eastern regions by using new advanced state support measures and by creating the best and highly competitive business environment. For example, we intend to continue adjusting the mechanism of priority development areas for modern and joint projects with other countries, to create the best possible business climate for attracting the most advanced technologies to Russia and for manufacturing high value-added goods in the Far East.

Events of this year confirm the special significance of such a factor as accessible and affordable raw materials without which it is impossible to organise any production process or to set up co-production chains. Russia is just about the only country that is completely self-sufficient in terms of natural resources, and the Far East plays a substantial role here. This region is a highly important supplier of crude oil and natural gas, coal, metals, timber and marine biological resources to the domestic market and our foreign partners.

We are staking on the prudent and rational development of Russia’s natural riches under the most stringent environmental standards. First of all, we will refine all extracted raw materials domestically as much as possible. We will also use these raw materials to strengthen the sovereignty of this country, to ensure industrial security, to raise incomes and to develop the regions.

We have already protected the resource extraction industry from unfriendly actions. From now on, only companies with Russian jurisdiction have the right to develop natural resources in Russia.

The Ministry of Natural Resources and Environment together with the Ministry of Industry and Trade and leading business associations has determined the national economy’s demand for strategic raw materials. This information will become the foundation of the revised Strategy for the Development of Russia’s Mineral Resources Base with an extended planning horizon up to 2050.

At the same time, special focus should be placed on geological exploration and processing of rare raw materials (such as titanium, manganese, lithium, and niobium), which are used in metallurgy, medical and chemical industries, microelectronics, aircraft manufacturing and other industries, as well as in new energy storage and transmission technologies.

I would like to separately ask the Government to have a look at the bioresources harvesting sphere, where we have a mechanism of investment quotas. Here, it is important to achieve balanced growth and full utilisation of production capacities, as well as to ensure the harmonious development of the regions’ infrastructure.

I would like to stress that the funds the state receives from the utilisation of water bioresources must above all be allocated for developing the infrastructure of rural areas, employment support, and increasing incomes of local residents. I ask the Government to take specific measures on this. We have discussed this many times.

Next, over the past years Russia has implemented big plans for the development of transport infrastructure, railways and roads, seaports and pipelines. These timely decisions have made it possible for businesses to quickly rebuild logistics in today’s conditions, and redirect cargo flows to those countries that are ready and willing to trade with Russia and prefer civilised and predictable business relations.

It is noteworthy that despite the attempts of external pressure, the total cargo of Russian seaports has only slightly decreased over the seven months of this year; it has remained at the same level as a year earlier, which is about 482 million tonnes of cargo. Last year there were 483 million, so the figure is practically the same.

At the same time, Far Eastern ports are seeing a real logistics boom. The volume of cargo transhipment and container handling is such that specialists are working 24/7 to handle the workload. In a word, no matter how much someone might like to isolate Russia, it is impossible to do it, as we have always said so. It is enough just to look at the map.

We will use natural competitive advantages to build up our further transport capabilities, expand the road and railway network, build new access roads to sea terminals and expand their capacity.

I mentioned earlier that our focus is on building the eastward infrastructure and developing the North-South international corridor and ports of the Azov-Black Sea basin which we will keep working on. They will open up more opportunities for Russian companies to enter the markets of Iran, India, the Middle East and Africa and, of course, for reciprocal deliveries from these countries.

The total volume of freight and cargo transportation along these routes and arteries will be able to grow by about 60 percent by 2030. We are absolutely realistic about our predictions, and this is how it will be. To achieve these numbers, the Government has drafted specific “roadmaps” in the three areas I outlined earlier, which will enable us to make this work consistent, consolidate and coordinate our efforts in terms of deadlines and capacity to break up the bottlenecks and upgrade border checkpoints and related infrastructure.

In addition to our plans to expand transport corridors, it is important to put in place new rolling stock and railway traction vehicles, to provide Russian shipyards with orders for modern high-quality tankers, dry cargo ships and container vessels, including ice-class ships, for the further expansion of the Northern Sea Route as a potent transport corridor of national and global importance with, I want to stress this, year-round navigation. The state-of-the-art icebreakers that we are designing and building make it possible for us to do this already now.

This year, a container vessel made its first run between Murmansk and Kamchatka along the Northern Sea Route to reaffirm the reliability and safety of shipping operations in the Arctic zone.

Notably, the point is not just about authorising the passage of ships in the Arctic or simply connecting two destinations. What we need to do is make sure that ships are properly serviced and cargo is properly handled at each port along the route, and the traffic schedule is sustainable, predictable and reliable. Then, every Northern Sea Route waypoint and region will benefit from the logistics corridor. That is what we should be striving for.

The Government has approved a development plan for the Northern Sea Route until 2035 with plans to allocate 1.8 trillion rubles from various sources to implement it. As forecasted, the cargo traffic along this corridor will go from the current 35 million tonnes per year to the targeted 220 million tonnes per year.

The availability of freight vehicles is certainly a key factor in the transportation of goods to and from the Russian Far East. This means we need to offer economically justified and competitive freight rates. I am asking the Government to study all these issues carefully.

Aviation is a special issue for the Far East. Here, the availability of flights from the European part of Russia to the Far East is not the only issue, but connectivity between the Far Eastern regions themselves also matters – air services should cover as many destinations, cities and regions of the Far East as possible.

That is why we have established a single Far Eastern airline. It offers almost 390 destinations, some of them subsidised by the state. In the next three years, this airline’s traffic should increase, and the number of destinations will exceed 530. And as we could see after those flights were opened, these destinations are in great demand.

To implement these plans, we need to expand the company’s fleet, to make sure it has modern aircraft, including small aircraft. A decision has been made in this regard, and I ask the Government to strictly implement it.

I would like to note that in general, Russian air carriers will soon be thoroughly re-equipped. Our airlines, including Aeroflot, have placed the largest order package in modern history, for about 500 Russian-made mainline aircraft. By the way, as far as I know, the United Aircraft Corporation and Aeroflot have signed a respective agreement on the sidelines of this Eastern Economic Forum, and the figures in there are quite impressive – over a trillion, I think.

This high demand should become a powerful incentive for aircraft factories and design bureaux, for many related industries, including electronics and aircraft components, and, of course, for the schools training professional personnel including engineers and skilled blue-collar workers in the aviation industry.

I would like to add that a decision has been made on another sensitive issue for the Far East. I am referring to the development of air medical services and increasing the availability of medical care for people living in remote areas. Starting next year, we will more than double federal funding for these purposes, which means that the number of flights will also increase, and there will be faster and better provision of healthcare in the region.

Friends, colleagues,

All our decisions involving the economy and social sphere, all the mechanisms that we are implementing in the Far East have the same important purpose – to make this region a truly attractive place for living, studying, working, for starting families, to ensure that more children are born.

Several important initiatives in this regard have been included in the package of measures that the Government is now considering. One of them is to create an up-to-date environment for living, to improve the local cities and towns.

Let me remind you that at the last forum, we set a task to develop master plans for the development of the largest Far Eastern cities. These include all administrative centres of the regions, and cities with a population of over 50,000 people, as well as Tynda and Severobaikalsk, the key stations on the Baikal-Amur Mainline railway.

We had in mind an integrated approach to the development of communities, where plans for the modernisation of infrastructure, social facilities, and creation of public spaces and so on would be combined competently and conveniently, and economic and industrial projects would rely on thoroughly calculated business models.

In all cities, the initial task was to make strategic development plans. Master plans are already being actively developed on the basis of those strategic plans in 17 cities and metropolitan areas. One of them has to do with the development of the Petropavlovsk-Kamchatsky urban area, and the day before yesterday, we discussed this issue with our colleagues on the spot. Once again, I ask the Government to provide maximum assistance in implementing this and other master plans in order to have them unconditionally implemented.

Here, among other things, it is important to use tools such as the Far Eastern concession, the government’s infrastructure loans and infrastructure bonds. It is necessary to determine target limits for the Far East in these programmes. The funds should be used for urban development and improvement, and of course, for infrastructure, including the upgrade of existing networks and connections to utilities.

I would like to add that at the recent St Petersburg Economic Forum, I instructed the Government to allocate an additional 10 billion rubles annually for improvement projects in Russian cities. I think it would be right to channel half of this financing, that is, 5 billion a year, towards upgrading Far Eastern cities and towns with populations below 250,000.

Separate resources should also be allocated under all our main infrastructure development programmes for projects to modernise Far Eastern cities. I have already given such an instruction, and I ask you to ensure its implementation as quickly as possible. Target limits should be stipulated in the federal budget for the next three years.

Something else I would like to stress – we need to increase the volume of housing construction in the Far East, while also widely applying the most advanced ‘green’ and energy-efficient construction technologies.

This year, the Far Eastern Quarters programme was launched. Under this programme, developers will be able to take advantage of priority development areas, including tax and infrastructure benefits, which will reduce the cost of flats and the price of finished housing. This will increase the availability of housing for people. The plan is to build about 2.5 million square metres of housing by 2030 using this cost-reduction mechanism. I ask the regional authorities and the Ministry for the Development of the Russian Far East to hold the first tenders by the end of the year, to select developers and start designing and developing the residential buildings.

Next, the Far Eastern residents are entitled to special, preferential mortgage terms. As many as 48,000 families have already purchased new housing using mortgages with a rate of 2 percent. This year, we have expanded the Far Eastern mortgage programme so that doctors and teachers, regardless of their age, can apply for it along with young Far Easterners.

Let me remind you that the programme is planned until 2024. But given the demand and efficacy – and this programme is working effectively – I propose extending it until at least 2030. I hope that the Far Eastern residents will also appreciate this.

(Applause.)

A separate decision concerns the support of young professionals who come to the Far East or graduate from local educational institutions, get a job and consider local accommodation. As many as 10,000 rental apartments will be built for them. The rental rate will be significantly below the market level due to subsidies from the regional and federal budgets. The Government has already envisaged such a measure. I ask you to work out all the details in order to start building rental housing for young professionals without delay. And I would like to specifically point out that the location of this housing should be included in the development master plans for Far Eastern cities, which means all the necessary infrastructure should be available – in short, such accommodation should be convenient and enjoy demand.

I would like to note that the Far Eastern regions, like many other regions of the Russian Federation, are experiencing a shortage of workers today. We will also take several important steps to intensify personnel training in key competencies. Over 900 modern workshops will be opened in Far Eastern colleges by 2030, and in the near future, until the end of 2025, we will launch 29 production and educational clusters. In addition, businesses will receive compensation for employing young workers.

Another important area is improving the quality of higher education in the Russian Far East. The goal is to attract qualified instructors, upgrade facilities and equipment in higher education institutions, and provide grants to stimulate academic research and prospective developments in the crucial areas of the technological agenda.

There are network programmes for Far Eastern universities that connect education institutions in the region with the country’s leading universities such as St Petersburg State Marine Technical University, Moscow Aviation Institute and others. We will undoubtedly support this area of cooperation.

Finally, branches of the Russian Institute of Theatre Arts (GITIS), the National State Gerasimov Institute of Cinematography (VGIK) and the Boris Shchukin Theatre Institute will open in 2025 in the Russian Far East to train cultural and art workers. I would like to ask the Government to provide all necessary assistance.

I would like to note that the Far Eastern regions offer their own professional development initiatives. For example, the Agency for Strategic Initiatives in the Sakhalin Region supports a pilot project called Earning Money Together. Participants in the project will be able to undergo free additional training, receive career guidance and get help with starting a business. Based on the outcome of these pilot projects we will think about scaling up.

I also want to mention a training programme for a new generation of managers in the Far East. The programme focuses on cultivating a local pool of talent, and on integrating study programmes and internships in public offices and development institutions. This programme is already running and I suggest that the heads of all regions in the Far Eastern Federal District get involved.

Colleagues, I want to conclude my remarks by stressing once again that the modern global economy and the entire system of international relations is going through challenges. However, I believe that the logic of cooperation, aligning the potentials and mutual benefits that our countries and our friends in the region adhere to, will prevail no matter what. By reasonably taking advantage of the competitive sides and strengths of the Asia-Pacific countries, by creating constructive partnerships we will open new colossal opportunities for our peoples. We are ready to work together for the sake of a successful future. And we are grateful to our partners for participating in this work.

Thank you.

The Fed’s Austerity Program to Reduce Wages

June 21, 2022

By Michael Hudson and posted with the author’s permission

Preface:

The Federal Reserve Board’s ostensible policy aim is to manage the money supply and bank credit in a way that maintains price stability. That usually means fighting inflation, which is blamed entirely on “too much employment,” euphemized as “too much money.”[1] In Congress’s more progressive days, the Fed was charged with a second objective: to promote full employment. The problem is that full employment is supposed to be inflationary – and the way to fight inflation is to reduce employment, which is viewed simplistically as being determined by the supply of credit.

So in practice, one of the Fed’s two directives has to give. And hardly by surprise, the “full employment” aim is thrown overboard – if indeed it ever was taken seriously by the Fed’s managers. In the Carter Administration (1777-80) leading up to the great price inflation of 1980, Fed Chairman Paul Volcker expressed his economic philosophy in a note card that he kept in his pocket, to whip out and demonstrate where his priority lay. The card charted the weekly wage of the average U.S. construction worker.

Chairman Volcker wanted wages to go down, blaming the inflation on too much employment – meaning too full. He pushed the U.S. bank rate to an unprecedented 20 percent – the highest normal rate since Babylonian times back in the first millennium BC. This did indeed crash the economy, and with it employment and prosperity. Volcker called this “harsh monetary medicine,” as if the crash of financial markets and economic growth showed that his “cure” for inflation was working.

Apart from employment and wage levels, another victim of Volcker’s interest-rate hike was the Democratic Party’s fortunes in the 1980 presidential election. They lost the White House for twelve years. The party thus is taking great courage – or simply being ignorant – by entering on this autumn’s midterm election by emulating Mr. Volcker’s attempt to drive down wage levels by financial tightening, which already has crashed the stock market by 20 percent.

President Biden has thoroughly backed up Republican-appointed Federal Reserve Chairman Jerome Powell in endorsing a financial crash in hope that it will roll back U.S. wage levels. That is the policy of the Democratic Party’s donor class and hence political constituency.

……………

To Wall Street and its neoliberal policy backers … the solution to any price inflation is to reduce wages and public social spending. The orthodox way to do this is to push the economy into recession in order to reduce hiring. Rising unemployment will oblige labor to compete for jobs that pay less and less as the economy slows.

This class-war doctrine is the prime directive of neoliberal economics. It is a feature of the tunnel vision of corporate managers and the One Percent. The Federal Reserve and IMF are are the operating arms for impoverishing the masses. Along with Janet Yellen at the Treasury, public discussion of today’s U.S. inflation is framed in a way that avoids blaming the 8.2 percent rise in consumer prices on the Biden Administration’s New Cold War sanctions on Russian oil, gas and agriculture, or on oil companies and other sectors using these sanctions as an excuse to charge monopoly prices as if America has not continued to buy Russian diesel oil, as if fracking has not picked up and as if corn is not being turned into biofuel. There has been no disruption in supply. We are simply dealing with monopoly rent by the oil companies using the anti-Russian sanctions as an excuse that an oil shortage will soon develop for the United States and indeed for the entire world economy.

Covid’s shutdown of the U.S. and foreign economies and foreign trade also is not acknowledged as disrupting supply lines and raising shipping costs and hence import prices. The entire blame for inflation is placed on wage earners, and the response is to make them the victims of the coming austerity, as if their wages are responsible for bidding up oil prices, food prices and other prices resulting from the crisis. The reality is that they are too debt-strapped to be spendthrifts.

The Fed’s Junk Economics of What Bank Credit Is Spent On

The pretense behind the Fed’s recent increase in its discount rate by 0.75 percent on June 15 (to a paltry range of 1.50% to 1.75%) is that raising interest rates will cure inflation by deterring borrowing to spend on the basic needs that make up the Consumer Price Index and its related GDP deflator. But banks do not finance much consumption, except for credit card debt, which in the United States is now less than student loans and automobile loans.

Banks lend almost entirely to buy real estate, stocks and bonds, not goods and services. Some 80 percent of bank loans are real estate mortgages, and most of the remainder are loans collateralized by stocks and bonds. So raising interest rates will not lead wage-earners to borrow less to buy consumer goods. The main price effect of less bank credit and higher interest rates is on asset prices – deterring borrowing to buy homes, and arbitragers and corporate raiders from buying stocks and bonds. So the main price effect of less bank credit and higher interest rates is to reduce stock and bond prices and demand for home mortgages.

Rolling Back Middle-Class Home Ownership

The most immediate effect of the Federal Reserve’s credit tightening will be to reduce America’s home-ownership rate. This rate has been falling since 2008, from nearly 68 percent to just 61 percent today. The decline got underway with President Obama’s eviction of nearly ten million victims of junk mortgages, mainly black and Hispanic debtors. That was the Democratic Party’s alternative to writing down fraudulent mortgage loans to realistic market prices, and reducing their carrying charges to bring them in line with market rental values. The indebted victims of this massive bank fraud were made to suffer, so that Obama’s Wall Street sponsors could keep their predatory gains and indeed, receive massive bailouts. The costs of their fraud fell on bank customers, not on the banks and their stockholders and bondholders.

The effect of discouraging new home buyers by raising interest rates is to lower home ownership – the badge of being middle-class. The Fed’s policy of raising interest rates will greatly increase the interest charges that prospective new home buyers will have to pay, pricing the carrying charge out of reach for many families. The United States is turning into a landlord economy.

As the United States has become more debt-ridden, more than 50 percent of the value of U.S. real estate already is held by mortgage bankers. That means that homeowners are left with only a minority share in the value of their homes; most is owed to their banks. The remaining homeowners’ equity – what they own net of their mortgage debt – has fallen even faster than home ownership rates have declined.

Real estate is being transferred from “poor” hands to those of wealthy landlord corporations. Private capital companies – the funds of the One Percent – are going to pick up the pieces from the coming wave of foreclosures to turn homes into rental properties. Higher interest rates will not affect their cost of buying this housing, because they buy for all cash to make profits (actually, real estate rents) as landlords. Within another decade the nation’s home ownership rate may fall toward 50 percent (and homeowners’ equity even lower), turning the United States into a landlord economy instead of the promised middle-class home ownership economy.

The Coming Economic Austerity (Indeed, Debt-Burdened Depression) 

While home ownership rates have plunged for the population at large, the Fed’s “Quantitative Easing” has increased its subsidy of Wall Street’s financial securities from $800 billion to $9 trillion – of which the largest gain has been in packaged home mortgages. This has kept housing prices from falling and becoming more affordable for home buyers. But the Fed’s support of asset prices has saved many insolvent banks – the very largest ones – from going under. Sheila Bair of the FDIC singled out Citigroup, along with Countrywide, Bank of America and the other usual suspects. The working population is not considered to be too big to fail. Its political weight is small by comparison to that of Wall Street banks and other FIRE-sector beneficiaries.

Lowering the discount rate to only about 0.1 percent enabled the banking system to make a bonanza of gains by making mortgage loans at around 3.50 percent. The banks kept credit-card rates high – and made even more money on penalty fees for late payment than they “earned” on interest charges (in the range of 18 percent). And despite the stock market’s plunge of over 20 percent from nearly 36,000 to under 30,000 on June 17, America’s wealthiest One Percent, and indeed the top 10 Percent, have vastly increased their wealth in stocks, while the bond market has had the largest boom in history. But most Americans have not benefitted from this runup in asset prices, because most stocks and bonds are owned by only the wealthiest layer of the population. The Fed is all in favor of asset-price inflation. But For most American families, corporations and government at all levels, the financial boom since 2008 has entailed a growing debt burden. Many families face insolvency as Federal Reserve policy aims to create unemployment. Now that the Covid moratorium on the evictions of renters behind in their payments is expiring, the ranks of the homeless are rising.

The Biden Administration is trying to blame today’s inflation and related distortions on Putin, even using the term “Putin inflation.” The mainstream media follow suit in not explaining to their audience that Western sanctions blocking Russian energy and food exports will cause a food and energy crisis for many countries this summer and autumn. And indeed, beyond: Biden’s military and State Department officers warn that the fight against Russia is just the first step in their war against China’s non-neoliberal economy, and may last twenty years.

That portends a long depression. But as Madeline Albright would say, they think that the price is “worth it.” As seen by the Biden regime, the New Cold War is a fight between the “democratic” United States, with its privatized economic planning in the hands of the financial class, and “autocratic” China and Russia, where banking and money creation are treated as a public utility to finance tangible economic growth instead of serving the financialization of the economy.

There is no evidence that America’s neoliberal-neoconservative New Cold War can restore the nation’s former industrial and related economic power. The economy cannot recover as long as today’s debt overhead is left in place. Debt service, housing costs, privatized medical care, student debt and a decaying infrastructure have made the U.S. economy uncompetitive. There is no way to restore its economic viability without fundamental changes in economic policy. But there is little “reality economics” at hand to provide an alternative to the class war inherent in neoliberalism’s belief that the economy and living standards can prosper by purely financial means, by debt leveraging and corporate monopoly rent extraction while the United States has made its domestic manufacturing uncompetitive – seemingly irreversibly. To reduce their labor costs, U.S. corporations moved manufacturing offshore, thereby depriving the American work force of high value-added, high productivity jobs.

The Rentier Class Has Sought to Make America’s Neoliberal Privatization and Financialization Irreversible

It has succeeded to such a degree that there is no party or economic constituency promoting the policies needed for an industrial recovery. Yet the Democratic Party leadership, subjecting the economy to an IMF-style austerity plan, will make this November’s midterm elections unique. For the past half century, the Fed’s role has been to provide easy money for the economy, to give the ruling party at least the illusion of trickle-down prosperity to deter voters from electing the opposition party. But this time the Biden Administration is running on a program of financial austerity.

The Party’s identity politics address almost every identity except that of wage-earners and debtors. Advocating lower wages, more expensive financial charges for home mortgages and credit-card loans, and broken promises for student-debt writedowns does not look like a platform that can attract many voters, especially as the administration pours money into Ukraine. Republicans such as Tucker Carlson are appealing to the “deplorables” majority that the Democrats have left behind.

Addendum: Yves Smith of Naked Capitalism reminds me that: “Paul Volcker made it explicit that the Fed is in the business of crushing labor. As reported by William Greider in Secrets of the Temple, when Volcker was driving interest rates to the moon, he kept a note card in his pocket. It was a record of weekly average construction wages. Volcker wanted them to go down as proof his harsh medicine was working.”

M.K. Bhadrakumar, “West at inflection point in Ukraine war,” Indian Punchline, June 19, 2022

“Fundamentally, the Western economies are facing a systemic crisis. The complacency that the reserve-currency-based US economy is impervious to ballooning debt; that the petrodollar system compels the entire world to purchase dollars to finance their needs; that the flood of cheap Chinese consumer goods and cheap energy from Russia and Gulf States would keep inflation at bay; that interest rate hikes will cure structural inflation; and, above all, that the consequences of taking a trade-war hammer to a complex network system in the world economy can be managed — these notions stand exposed.”

Democrats’ ‘divide and conquer’ Senate show trial may jeopardize duopoly

US Rep. Ilhan Omar (D-MN) (L) talks with Speaker of the House Nancy Pelosi (D-CA) during a rally with fellow Democrats before voting on H.R. 1, or the People Act, on the East Steps of the US Capitol on March 08, 2019 in Washington, DC. (AFP photo)
Chairman Roger Wicker, R-Miss., right, and Senator Roy Blunt, R-Mo., confer during the Senate Commerce, Science, and Transportation Committee confirmation hearing for Gina Raimondo, nominee for Secretary of Commerce, in Russell Senate Office Building in Washington, DC on January 26, 2021. / AFP / POOL / Tom Williams
Democrats’ ‘divide and conquer’ Senate show trial may jeopardize duopoly
(Ramin Mazaheri (@RaminMazaheri2) is currently covering the US election. He is the chief correspondent in Paris for Press TV and has lived in France since 2009. He has been a daily newspaper reporter in the US, and has reported from Iran, Cuba, Egypt, Tunisia, South Korea, and elsewhere. He is the author of ‘Socialism’s Ignored Success: Iranian Islamic Socialism’ as well as ‘I’ll Ruin Everything You Are: Ending Western Propaganda on Red China,’ which is also available in simplified and traditional Chinese.)

Tuesday, 26 January 2021 10:40 PM  [ Last Update: Tuesday, 26 January 2021 10:44 PM ]

Press TV and The Saker

By Ramin Mazaheri

Much ink could be spilled about the upcoming, and second, Senate impeachment trial of Donald Trump, but that would be a waste of ink – the trial has nothing to do with social justice or patriotism and everything to do with aggravating political divisions for elites’ gain.

We could say it’s just “politics as usual”, but only if: the “True Rate of Unemployment” wasn’t pushing 30%, even per Politico; 2020 didn’t witness the biggest annual rise in the US poverty rate since the 1960s; America didn’t just have its most disputed election in anyone’s memory; there weren’t armed soldiers protecting politicians nationwide, or, according to nearly 40% of the country, there weren’t armed soldiers making sure politicians are illegitimately installed in the White House. In the US right now politics are not usual, whatsoever.

It is incredibly bad journalism the way the US Mainstream Media endlessly overplays the number of Republican defectors against Trump – they get way, way too much press, and of course it’s because they don’t want to admit Trump has any grassroots support (which is not from neo-Nazis). One might have easily imagined that scores of House Republicans were about to vote in favor of Trump’s impeachment, yet only 10 out of 211 did (5%). To give one mainstream example, it was totally misleading of the Los Angeles Times to write that a “bipartisan House majority voted to charge him” after the House’s January 13 vote, and in their lede paragraph, no less, and to even mention the 10 Republicans in their headline. Trump remains the most popular Republican by leaps and bounds – there is no way 17 of 50 Republican senators will end their re-election chances just to appease a Never Trumper movement which only won the general election by a 51-47 margin. Trump’s first Senate trial was a landslide – by supermajority standards – for “not guilty”: 52-48 in favor of Trump.

Given the assurance of acquittal (again) we should ask who benefits from this second trial, and who does not benefit?

Obviously, the enormous mass of everyday Americans will see no benefit from the trial, and I listed just a few of the once-in-a-century reasons why they have more pressing concerns. It is never declared in the US media that the US public has no real appetite for the Senate trial – they need and want the governors of the nation to govern, and right now.

The only way Americans could possibly be convinced that the nation needs to shut down Congress for weeks with a trial whose conclusion is not in doubt is via constant Mainstream Media talking heads shrieking about its necessity, and with the very same fervor that they were shrieking that Russia stole the 2016 election. This is fake-news, too, and it certainly takes airtime away from discussing things like the “True Rate of Unemployment”.

The only people among average Americans who insist that seeing ex-president Trump in the dock is more pressing than resolving the multiple areas of socioeconomic disaster are the most bloodthirsty and rabid of the Never Trumpers. How can one easily switch off four years of demonization? Answer: many simply are psychologically unable to move on, and even though they got what they want – Trump is out of the White House. But while these people – generally upper- and upper-middle class persons who are not very touched by the economic crisis – are loudly obnoxious they are not in actual control of the levers of power.

It’s primarily the nation’s elite-level politicians who really want to make America’s Marianas Trench-depth cultural-political divide even deeper, but not for the reasons one may think.

Many Congressional Democrats are no doubt embarrassed and vengeful over having been turned into cowering, world’s fanciest gas mask-wearing deserters on January 6 – these people control the legislative docket and they want Trump to look afraid now. That would be a self-centered and over-emotional reaction, but why should we ascribe self-sacrifice for the well-being of the nation among the virtues of Congressional Democrats?

The Capitol Hill protest did make many Democrats even more dead-set on getting Trump out: Despite being elected president once and narrowly winning re-election – or rather, precisely because of this electoral success – Democrats want to try and ensure that Trump cannot run in 2024, and a Senate conviction would bar Trump from ever holding public office again. Again, they are deluded by endless MSM spin if they think they have a realistic chance of turning so many Republicans.

Those are two plausible motivations for the Senate trial, but they are not sufficiently convincing.

How elite Democrats gain from a trial, but America loses (unless a 3rd party truly sprouts)

There seem to be so many tiny groups which gain in the many instances where one reads “but America loses”? Thirty million Americans file for unemployment in 2020 – the S&P 500 gains $14 trillion in value over the same timeframe (up 16% annually). Four hundred thousand Americans die from coronavirus – the first vaccine announced only two days after Joe Biden prematurely declares victory, allowing Biden to change the media focus from his divisive and promise-backtracking early declaration.

By forcing a trial in the Senate Democrats seem to think they can win big by playing “divide and conquer” or even just “divide and divide”.

In the latter scenario Democrats certainly gain by forcing Congressional Republicans to openly divide themselves into pro- and anti-Trump factions, which will necessarily be revealed during the Senate vote on the 2nd impeachment. That vote will be like the 2003 Iraq War vote for Democrats (but only if we falsely imagine today’s Democrats to actually be an anti-war party anymore). If nothing else is gained for elite Democrats – who happily watched households crumble and workers go hungry until after Biden’s election to finally become willing to negotiate a second, paltry household stimulus – a Republican Party distracted by squabbles, and thus open to being bought into defection on certain key votes, is enough reason to waste everyone’s time with a Senate show trial.

The “divide and conquer” scenario is more worrying for national health, because the pro-War Democratic Party does like to conquer human beings: There are incredibly shocking efforts to blacklist, censor and seemingly criminalize Trump supporters. By forcing Trump’s Congressional supporters into the open Democrats will know exactly where to set their stigmatizing sights. I cannot believe that Democrats are going to lead a multi-month, much less multi-year, “Trumperphobia” campaign, but I also couldn’t believe the 2016 Russophobia campaign lasted until even after the 2019 Mueller Report’s exoneration of Russia. Is it possible that Democrats are going to persist in their anti-Trumper cultural pogrom for years rather than honestly discuss America’s decline?

But the main question is: How deep is the American duopoly? Answer: the deepest and oldest in the world.

What if Democrats are actually trying to create a Republican Party division into two parties, with the Trumper faction defecting to a new “Patriot” or “America First” party? That would end the need for Democratic legislative majorities – all they’d need is a plurality (as in every other modern democracy).

Is it possible that Trump will actually undo America’s awful legislative duopoly and bring in a multi-party system? Like most good things Trump has done, this boon would be an unintended consequence of Trump’s actual political agenda.

Are Democrats looking to end the two-party system by giving Trumpers a clear indication that they can either organize, drop out or get persecuted by the US system? Are anti-Trump Republicans daft enough to think that the Republican Party will stay Reaganite forever, even after Reaganites allowed the Great Financial Crisis to mushroom into the Great Recession for so many of their voters?

I would say that – in the end – Democrats are not looking to end the duopoly, in which they are the party which is paid no matter what: they are paid to make sure actual leftist ideas lose, by combining them with fake-leftists idea such as identity politics, and they are paid to make sure leftist gains are truly, truly minimal when they do occasionally have power.

But Democrats are US politicians, after all – they cannot think long-term, and they openly admit they spend 2/3rds of their working hours focused on getting campaign money for their re-election – and so they really don’t know what they are doing, or even care about the medium- and long-term consequences of their actions. The Senate trial of Trump is useless theater, but who knows what these professional actors really feel or if they even feel anything at all? If they feel anything it is for their supporters and “work family”, which can be found on Wall Street and not Main Street.

Just as the January 6th protest was improvised and not the start of a long-term “Occupy Capitol Hill” movement – it had none of the determination and planning of Egypt’s Tahrir Square” (in a nod to this week’s 10th anniversary of that wonderful progressive movement, which was repeatedly sabotaged by Washington and Tel Aviv and their Egyptian compradors). Democrats are now improvising a way to keep inflicting opprobrium, censorship and maybe even criminal convictions on the odious – yet quite popular and taboo-breaking – Trump. Just like in 2016: anything to keep from discussing the real roots of any sort of “drain the Swamp” political feeling and America’s undeniable decline. 

Elite Democrats don’t have Russia to kick around anymore, let’s remember – all they have is Trump and his 74 million supporters. Kick them too much and Democrats might break their own precious duopoly.

(The views expressed in this article do not necessarily reflect those of Press TV.)


Press TV’s website can also be accessed at the following alternate addresses:

www.presstv.ir

www.presstv.co.uk

www.presstv.tv

Like 2017 France, will voters choose Trump just to end a fake-leftist party?

Like 2017 France, will voters choose Trump just to end a fake-leftist party?

October 04, 2020

By Ramin Mazaheri for the Saker Blog

Since 1996 Americans have proven that they know their own country: polls show they have correctly picked the winner of the popular vote every time. Even though Trump’s approval rating is under 50% and poll aggregates show he trails by 8%, Gallup just asked who they think will win and 56% of Americans picked Trump, including 24% of Democrats, while just 40% picked Biden.

That’s a big spread, but it confirms what everybody tells me from small towns to Chicago, and I ask everyone. It’s pretty pathetic to see the fear in the eyes of some Biden supporters – you aren’t Afghans planning a wedding party during the Obama era, ok?

Given the extraordinary economic disaster and mass unemployment (in a country with no social safety net) it seems totally impossible for any incumbent to survive, but we should not forget that Democrats are the half of the duopoly which is paid to lose: they are here to provide a safety valve against real leftism (they are Bernie Sanders writ large), and to divert people away from leftist solutions to America’s lack of a social safety net with fake-leftist divisiveness.

Trump has caught coronavirus, and – I’m sure he’s saying – it’s the biggest, most stupendous, most world-famous case of corona ever! It is – Trump is finally not over-selling. But so will be the recovery, no? A recovered Trump (and a 74-year old man has just a 3% chance of dying after contracting corona) who doesn’t make Biden’s willingness for even more devastating, unbearable, technocratic lockdowns a top-two issue would prove that corona does indeed cause lasting brain damage.

The Deep State and their proxies have obviously done everything – fair or foul – they could to stop Trump, and yet I haven’t seen anyone discuss the idea that the White House corona outbreak was injected there on purpose? If anybody could and would do it – and then see Trump survive and overturn their best-laid plans – it would be US Democrats, no?

Trump has the good fortune of running against a Democratic Party which – the ousting of Bernie Sanders and the elevation of Kamala Harris shows – is dominated by a tiny cabal of well-connected Clintonistas, the corporate board members residing in one of the world’s biggest tax havens (the state of Delaware, home of Biden) and Hollywood media liberals who will get incredibly upset at my upcoming use of the term “Frenchmen” instead of “Frenchx”.

Indeed, the biggest achievement of US liberals since 2016 may merely be forcing people to use “Latinx” instead of “Latino/a”. At the “China: Isn’t It Time to Turn To Us?” first presidential debate I don’t recall Biden uttering the word “impeachment”, and he definitely didn’t talk about Russiagate – Democrats can’t possibly run on their own pathetic record?

Yes, the US is such a politically-ignorant country that Trump can accuse “Corporate Joe” Biden of being a “radical socialist” and actually find believers, but Western fake-leftist parties are increasingly being punished by voters for their “right-wing economics and right-wing foreign policy but with political correctness” platform.

It’s amazing that the Clintonista faction wasn’t forced from power after stunningly losing to a reality show star in 2016, but if they snatch defeat from the jaws of victory again will there finally be a fair reckoning?

Could defeat in November break up the ossified, out-of-touch and certainly ineffective Democratic Party?

There is a recent Western precedent for such an abrupt exit: the Socialist Party of France.

In 2017 they were rejected so emphatically that their perpetual post-WWII duopoly-dominance became quickly irrelevant; the fact that in 2012 they won both the presidency and 36% more seats than any other party in Parliament became quickly irrelevant. What cost the Socialist Party was the patsy Francois Hollande’s appalling backtracking on his campaign promise to end austerity – it finally became totally clear to Frenchmen that the Socialist Party should be called the “Neoliberal Party of Brussels”.

The French left remains in total disarray, as they should be, given how they refused to listen to their constituents and how they proved themselves to be elitist, duplicitous and amoral technocrats. The trend in France is for the Green Party to be given a chance next, as they are the only other not-yet-discredited option other than the tiny true left and the “paper tiger” far-right.

Yes, unlike the US the French political spectrum contains more than just two parties, but the bigger difference is that the French voter was smart enough to be out for blood in 2017: the #1 reason people voted for Emmanuel Macron was to block Marine Le Pen, but the #2 most-stated reason was to sweep both mainstream parties out from entrenched power – it worked spectacularly well against the Socialist Party.

The United States is far more more prone to hysterical fear-mongering than the cool and politically-experienced French, and “never Trump derangement syndrome” does help explain why there isn’t a similar “cast your vote to kill the mainstream party” movement like France had in 2017. Of course, votes for Trump in the 2016 Republican primaries were made for precisely this reason – this is totally forgotten/covered-up/ignored/misunderstood in 2020 USA.

Such a movement is certainly good sense (which American leftists rarely have), though, as well as political justice.

Yet it seems impossible to imagine someone like Nancy Pelosi – eating her $13 ice cream while getting an illegal high-class haircut – wouldn’t be made the fall-guy (“fall-guyx”?) for yet another Democratic debacle, but was there any change whatsoever after Hillary’s loss?

Is there any doubt that a Biden win wouldn’t see Hillary taking a top cabinet post, replete with royal re-coronation media coverage? Hillary’s certain return is never, ever discussed here because it would obviously turn many voters away from the Democrats in disgust, even though she’s already said she’s ready to join Biden’s administration. A vote for Biden is indeed a vote for Hillary.

But when did Democratic Party leadership ever care about being popular among the masses?

They don’t have to care because the reality is that the American system is incredibly undemocratic at the upper level. Maybe at the local levels we can talk about a face-off between a small town’s two richest lawyers as being a marginally democratic election, but at the top the American system is a most-rigid Politburo dominated by politicians, lobbyist-connected generals and billionaires who never even paid lip service to ideals which weren’t grasping Western individualism, self-righteous arrogance and realpolitik greed.

Forty years ago Democrats in Detroit and in the farming Delta may have said things which condemned those obvious flaws in the neo-aristocratic (bourgeois) US model, but now Democrats only say such things at election time. Take, for example, the discussions about African-American reparations during the Democratic primaries – LOL, no top Democrat has talked about that since Biden’s victory, and they won’t again… until 2024.

Cynically insist all you want that the Democratic Party, the oldest voter-based party in the world, is too entrenched, too privileged and has had too long to game the system in order to ever pay the price for such phony politics, but history says otherwise – just ask France’s fake-leftists.

Ramin Mazaheri is currently covering the US elections. He is the chief correspondent in Paris for PressTV and has lived in France since 2009. He has been a daily newspaper reporter in the US, and has reported from Iran, Cuba, Egypt, Tunisia, South Korea and elsewhere. He is the author of Socialism’s Ignored Success: Iranian Islamic Socialism’as well as ‘I’ll Ruin Everything You Are: Ending Western Propaganda on Red China’, which is also available in simplified and traditional Chinese.

News flash: Capitalism has no answer for 50 million jobless people

Source

July 11, 2020

News flash: Capitalism has no answer for 50 million jobless people

by Ramin Mazaheri for the Saker Blog

Oh – did you have one?

Well… we’re waiting.

But we will certainly be waiting in vain because the “best” US economic minds, journalists, professors and pundits got nuthin’. Even God’s gift to American society – CEOs and bankers – are hoping nobody calls on them for an answer.

This is an era of not just total economic disaster in the US but also an era of complete intellectual disaster. The chicken’s head has been cut off, yet the body (the American system/ideology, which is undoubtedly based upon capitalism-imperialism) still runs around.

I’ll skip to the end: whatever solution they come up with WILL DEFINITELY be some form of socialist-inspired policy… but the US will, true to form, remain totally untruthful about obvious truths (and thus mired in societal chaos).

The only solution to 50 million unemployed people is the redistribution of wealth downwards (first pillar of socialism) and the redistribution of political power downwards (second pillar of socialism); the latter is achieved via creating governmental institutions – staffed from all levels and sectors of society but especially at the upper management level – which establish the bureaucracy required to actually implement and sustain said redistributions intelligently, efficiently and in an egalitarian manner.

Those aren’t opinions but facts. Capitalists not having any solutions is another fact and not an opinion. These truths are so self-evident that I don’t even feel like arguing about it, so let’s argue about something else.

Why is the US talking about banning the Atlanta Braves and the Cleveland Indians but not the Minnesota Vikings or the Notre Dame Fighting Irish? It’s ok to have ethnic mascots, as long as that ethnicity has white-coloured skin? Seems rather inegalitarian to me, and bound to backfire into resentment and nihilism. And surely some sensitive hillbillies object to the Indiana Hoosiers, while the New York Mets (Metropolitans) clearly venerates urban citizens to an unfair degree. On this subject I constantly read the anti-non-White-mascot view, but nobody seems to analyse the intellectual weakness of their argument from a leftist point of view, and the reason for that is: the US economic and intellectual 1% sure as heck don’t want to talk about their total inability to deal with serious stuff, so they thrilled to talk instead about Cleveland’s smiling Chief Wahoo.

Easy solution: don’t decrease the number of “people” mascots but increase them. As an Iranian I’d love to see the Boston “Baluch” take the field, any field. Even a rink. After all, the Baluch are an ethnic tribe in the southeast who are certainly as tough as any Metropolitan. Truly, this is a socialist-inspired solution: venerate and protect ethnic identities equally one and all, and that’s why Armenians, Jews, Assyrians and Zoroastrians have guaranteed seats in Iranian parliament and affirmative action for the non-Han is all over China. The inequality of this latest identity politics battle is obvious to every American and only increases everyone’s stress level, but the only solution remains either to ban all ethnic mascots or make every ethnic tribe a mascot. Isn’t the latter more interesting and informative – had you ever even head of the Baluch until today? Both me and the kids would much rather see and could possibly learn a lot about Maoris, Zulus & Fighting Bretons than lame cardinals, dolphins and other totally unintimidating mascots (I’m looking at you, Utah Jazz).

What a nice, useless and rather immature diversion that was! Unfortunately for the US 1% I have solved this fake problem, so back to awful July 2020 reality:

France’s new prime minister/Macronian puppet has ruled out a second lockdown even if there is a second wave, saying that the economic and social cost was just too much. If you wouldn’t try something again, doesn’t that mean you rather wish you had never tried it at all? Europe’s economic chaos won’t become clear until they come back from vacation in September and things get back to “normal” – that will be the “economic 2nd wave” for the Western bloc, while the US part of that bloc is taking all their economic lumps in their still-ongoing first wave. Medically, the incredibly overweight, overstressed and governmentally-neglected US is also, predictably, having a longer first wave of Covid-19 than anyone else.

Cases are currently increasing in the entire southern half of the US, but deaths are not. This seems rather important, no? Check the chronometer – it is not April anymore: deaths are about 60% of what they were back then, proving times do change even if hysterical people do not. Check also those spring predictions: the Imperial College of London promised 100,000 deaths in non-Lockdown Sweden by June, but today there are only 5,500; incredibly, we still have London’s Daily Telegraph still quoting that discredited model as late on July 5th as though it was gospel. I would think that these realities – which are not “callous” but actually quite good news – should at least get a bit of discussion, but if you bring it up be prepared to have a single mother throw her shoe at you. Said Karens apparently have total confidence that the US can keep locking down into 2021 and that 75 million unemployed is no problem for the superbly-functioning US system?

Sure….

Again, the problem is that rabidly capitalist places like the US and UK have dismantled/never built the culture & bureaucracy needed to employ a nationwide lockdown – as I have said from the beginning: make the switch to socialism in economics and democracy and you can Lockdown all you want!

What’s that? I’m beating my head against the wall so it’s time for another diversion? Agreed: How about the Confederate flag controversy?

Here’s the thing: No Western nation, no matter how imperialist or fascist, has been asked to give up entirely the symbols of their past. Nobody is tearing down de Gaulle statues even though he was an imperialist who immediately bombed places like the Levant and Algeria after said peoples died en masse to save France from Germany. But the US South is being asked to entirely relinquish their past, and that’s just never going to fly because it’s unparalleled: it’s like asking Mongolia to give up Genghis Khan, whose success mainly rested not so much on fine horsemanship but upon his willingness to murder women and children en masse, and yet they built him the world’s biggest equestrian statue. No matter how big a Non-Mongolian Lives Matter movement gets – that’s not coming down.

While brutality and oppression did exist in 1864 the ideology of fascism simply did not, no matter how loudly a teenager incorrectly insists. The Confederate flag needs a socialist solution which respects the Southern US ethnic minority (which is exactly what they are), because eradicating the historic rebelliousness of the Confederate rebels will never be accepted by them.

It’s quite simple: just add a small Christian cross to differentiate to differentiate this new flag from the previous Confederate flag. Or add a huge cross and color it black to give slavery even more prominence – that gives the rare Black Cross of Texas flag. Christianity unites Southern Whites and Blacks, after all. This also shows that the Confederate flag is not the same as before and has been given a moral updating – that’s progress, not eradication from history, and furthers the goal of modern patriotic unity. Furthermore, from a socialist point of view there simply MUST be a way to separate White Southerners from slavery – poor whites were powerless class victims, of course – because castigating all Southern Whites is patently unfair and obviously fake-leftist identity politics. Of course, denying the primacy of class and claiming instead that skin color/ethnicity is more important is what capitalist-imperialists always do.

Another diversion and faux problem capably solved with a bit of socialist unity and modernity! Well, I admit that adding a Christian cross is a rather Islamic Socialist solution and not an Atheistic Socialist one, but to hell with them.

Ok, capitalism does indeed have a solution to 50 million jobless – massive domestic suffering combined with massive foreign deaths. Let’s examine the latter:

Can we crank up the war machine? Sorry, the US has too many allies now – Germany and Japan are part of a Western bloc that is totally governed by a colluding bankocracy and 1% which is totally united against their socialist-inspired enemies; but those enemies (China, Russia, Iran, Venezuela) have become too strong to fight; they couldn’t beat the Muslims, Vietnamese or Koreans, so they’re no longer candidates for opponents; who in Black Lives Matter will agree to be drafted to go fight some new, fabricated opponent in Africa? Anyway, the Pentagon is already the world’s biggest employer, so you mean crank it up even more? Thus, there is no militaristic solution – no WWIII for their Great Depression II.

Now let’s examine the former:

Can we take any more lands from Indians? Sorry – frontier done run out.

Can we steal any Black people’s wages? Sorry – that’s no longer a thing.

Can we debt enslave the average White Trash? Sorry – they are paying back their credit card debt at record rates, they are so scared about the future.

No, there is no capitalist solution to 50 million unemployed people. The true capitalist solution is massive suffering until things get so very, very bad that said things have no choice but to start to work out again, finally (i.e., following unregulated market forces).

There is, however, the old standby: “socialise the losses of the rich but keep calling it capitalism”. This worked out great for the 1% in 2008 and it’s working out just fine now… but it ain’t capitalism, and you are 1) dumber than a box of rocks, 2) fanatically indoctrinated to hate socialism, or 3) can’t be bothered to learn basic political definitions if you think that bailing out the 1% with taxpayer money/newly-printed money is somehow still capitalism.

But do a Google news search: even though socialism is the only economic and political ideology which can provide a solution to 50 million jobless people there are painfully few news articles discussing socialism, with the majority of them frantically warning against it. You can’t only blame Google’s anti-socialist algorithms for that.

You see now why this article was half stupid diversions? That’s the way America likes it… or, rather, that is what they are forced to like.

I originally planned to have this article’s headline to be, “Hey dummy: Capitalism has no answer for 50 million jobless people”. For those who still have faith that capitalism does have an answer – let’s just end it here.

*********************************

Corona contrarianism? How about some corona common sense? Here is my list of articles published regarding the corona crisis.

Capitalist-imperialist West stays home over corona – they grew a conscience? – March 22, 2020

Corona meds in every pot & a People’s QE: the Trumpian populism they hoped for? – March 23, 2020

A day’s diary from a US CEO during the Corona crisis (satire) March 23, 2020

– March 25, 2020

Tough times need vanguard parties – are ‘social media users’ the West’s? –

March 26, 2020

If Germany rejects Corona bonds they must quit the Eurozone – March 30,

2020

Landlord class: Waive or donate rent-profits now or fear the Cultural Revolution – March 31, 2020

Corona repeating 9/11 & Y2K hysterias? Both saw huge economic overreactions – April 1, 2020

(A Soviet?) Superman: Red Son – the new socialist film to watch on lockdown – April 2, 2020

Corona rewrites capitalist bust-chronology & proves: It’s the nation-state, stupid – April 3, 2020

Condensing the data leaves no doubt: Fear corona-economy more than the virus – April 5, 2020

‘We’re Going Wrong’: The West’s middling, middle-class corona response – April 10, 2020

Why does the UK have an ‘army’ of volunteers but the US has a shortage? – April 12, 2020

No buybacks allowed or dared? Then wave goodbye to Western stock market gains – April 13, 2020

Pity post-corona Millennials… if they don’t openly push socialism – April 14, 2020

No, the dollar will only strengthen post-corona, as usual: it’s a crisis, after all – April 16, 2020

Same 2008 QE playbook, but the Eurozone will kick off Western chaos not the US – April 18, 2020

We’re giving up our civil liberties. Fine, but to which type of state? – April 20,

2020

Coronavirus – Macron’s savior. A ‘united Europe’ – France’s murderer – April 22, 2020

Iran’s ‘resistance economy’: the post-corona wish of the West’s silent majority (1/2) – April 23, 2020

The same 12-year itch: Will banks loan down QE money this time? – April 26,

2020

The end of globalisation won’t be televised, despite the hopes of the Western 99% (2/2) – April 27, 2020

What would it take for proponents to say: ‘The Great Lockdown was wrong’? – April 28, 2020

ZeroHedge, a response to Mr. Littlejohn & the future of dollar dominance – April 30, 2020

Given Western history, is it the ‘Great Segregation’ and not the ‘Great Lockdown’? – May 2, 2020

The Western 1% colluded to start WWI – is the Great Lockdown also a conspiracy? – May 4, 2020

May 17: The date the Great Lockdown must end or Everything Bubble 2 pops – May 6, 2020

Reading Piketty: Does corona delay the Greens’ fake-leftist, sure-to-fail victory? – May 8, 2020

Picturing the media campaign needed to get the US back to work – May 11, 2020

Scarce jobs + revenue desperation = sure Western stagflation post-corona – May 13, 2020

France’s nurses march – are they now deplorable Michiganders to fake-leftists? – May 15, 2020

Why haven’t we called it ‘QE 5’ yet? And why we must call it ‘QE 2.1’ instead – May 16, 2020

‘Take your stinking paws off me, you damned, dirty public servant!’ That’s Orwell? – May 17, 2021

The Great Lockdown: The political apex of US single Moms & Western matriarchy? May 21, 2021

I was wrong on corona – by not pushing for a US Cultural Revolution immediately – May 25, 2021

August 1: when the unemployment runs out and a new era of US labor battles begin – May 28, 2021

Corona proving the loser of the Cold War was both the USSR & the USA – May 30, 2021

Rebellions across the US: Why worry? Just ask Dr. Fauci to tell us what to do – June 2, 2021

Protesting, corona-conscience, a good dole: the US is doing things it can’t & it’s chaos – June 3, 2021

Why do Westerners assume all African-Americans are leftists? – June 5, 2020

The US as Sal’s Pizzeria: When to ‘Do The Right Thing’ is looting – June 6, 2020

The problem with the various ‘Fiat is all the problem!’ (FIATP) crowds – June 9, 2020

Politicisation of Great Lockdown result of ‘TINA’ economic ignorance & censorship – June 14, 2020

Trump’s only hope: buying re-election with populist jobless benefits – June, 16 2020

US national media is useless – so tell me the good local news sources? – July 4, 2020

Hamilton movie: central banker worship & proof the US has no left – July 8, 2020


Ramin Mazaheri is the chief correspondent in Paris for Press TV and has lived in France since 2009. He has been a daily newspaper reporter in the US, and has reported from Iran, Cuba, Egypt, Tunisia, South Korea and elsewhere. He is the author of the books Ill Ruin Everything You Are: Ending Western Propaganda on Red China’ and the NEW Socialisms Ignored Success: Iranian Islamic Socialism.

Trump’s only hope: buying re-election with populist jobless benefits

June 16, 2020

by Ramin Mazaheri for the Saker Blog

Trump’s only hope: buying re-election with populist jobless benefits

The US economy is in such a dire state (if we may temporarily put down the newly-discovered problem of racism in the Western hemisphere (except for Cuba)) that US voters are going to be happy to sell themselves to the highest bidder come November. It’s not like anyone could get genuinely excited by Joe Biden, after all.

Trump has a huge advantage over Biden in that he can distribute money to voters today and until October – but does he realise that’s the only way to win re-election during this economic catastrophe?

The idea that the US economy has somehow stabilised – or even yet seen the worst – from the shock of three months (and counting) of corona overreaction is totally irrational. You can’t even put it into a single headline: Over 44 million unemployed people doesn’t include the absurd new stock market bubble, the “we’re done holding on” looming wave of bankruptcies in small businesses, the demand shock which is still omnipresent and solidifying with each passing day, the total lack of a corona exit strategy after the West rushed into the Great Lockdown out of a competitive idiocy that “whatever China’s system can do, we can do better”, and on and on and on.

It is thus little wonder that Americans have recently latched on to the far easier to grasp issues of colour-based racism and police brutality (which are also neutered of economics & class). But US cops murder Blacks all the time and that isn’t going away soon, sadly, and neither is the corona economic catastrophe.

So unlike other re-election campaigns this isn’t going to be just another referendum on the incumbent, as Democrats desperately wanted: amid such economic devastation the past will remain in the past until the issue of paying the bills at the end of this month gets sorted first. Fin du mois (end of the month) is the battle cry of the Yellow Vests, after all….

In late May I wrote August 1: when the unemployment runs out and a new era of US labor battles begin to stress how the US 1% made a huge tactical error amid the corona hysteria by granting $1,000 per week in unemployment benefits: that is better wages for half of America’s incredibly hard-working, zero-benefit receiving labor force. The 1% foolishly showed their hand: they are flush – absolutely flush with decades of productivity-produced profits, QE, compound interest, unearned rents, etc. – and now it’s crystal clear to all that they have been holding out. Anyone who says that the US “can’t afford” to extend unemployment past August 1 obviously has no idea what they are talking about economically – only 30% of the 2020 CARES package went to individuals, whereas 45% went to bosses big (corporate) and small (the Small Business Administration). More importantly: that 30% was the first “people’s QE” ever, so the percentage of “bailout money” gone to individuals since 2008 is roughly just a few percent.

This, and not racism, is the actual psychological basis for the recent US rebellions and prolonged anger: Americans are instructed to first “think race”, so that is what they ran to protest first, but they will eventually reach this higher level of economic understanding. The cultural reality is that the average American has been denied economic understanding; that their media is forbidden to discuss it – how could they ever immediately talk about I discussed in that article? They can’t – not without some violent rebellion first.

When the economic reality of America’s hoarded wealth does get discussed in an election context it portends a sea change in US politics, and not just labor battles.

The corona overreaction has created a situation where socialist “reverse patronage” is finally coming to America, and I say “good”: the power to hold a political seat should absolutely be based on how much you give back to the people – what else are Westerners paying so much taxes for? (In Western capitalism they are paying so much to keep the 1% in butter brickle, of course.)

Is Donald the man of the moment? After 3.5 years the answer has been: LOL, no

Maybe the problem all along has been this: Donald J. Trump actually does have principles, but they are bad ones?

We were right to pose the question: Considering his many bankruptcies, TV reality idiocies, sexual assault boasts, philandering and pandering racism (this list was not in any particular order nor exhaustive) I think we all were quite fair to assume that Trump was always only in it for Trump, and therefore he could maybe be a malleable instrument of the people’s will as the egomaniac would want to remain in the limelight via re-election.

Isn’t that why the Deep State went after him so quickly – because he dared to echo the common American’s call to reverse in free trade and foreign militarism? They were worried that the American people would finally have an idiot puppet to enforce their will, whereas the Deep State was used to having their own idiot puppets like Barack Obama, Dubya Bush and Ronald Reagan.

That assumed malleability gave two genuine reasons Trump truly was the “hope candidate” in the pathetic 2016 election: 1) Hillary Clinton was a proven warmonger and Deep State cheerleader, and 2) Trump was the first genuinely outsider politician since Andrew Jackson (I imagine it has been 3.5+ years since you were reminded of this comparison). It’s critical to always recall that Trump was emphatically rejected by the Republican Party until the very last moment, only six months before the November 2016 vote. Trump is not a “Republican”, and it’s only to keep a firm grip of party duopoly (and their need for a target for their American rage) that Democrats play along with this Republican-aiding fiction of Trump’s “mainstream-ness”.

I don’t think it’s appreciated enough that all bets are off: due to corona I am literally not accepting any more bets on the presidential election, because who knows what on earth is going to happen as a result of enforcing a multi-month pause to the capitalism-imperialism machine?! Could be World War III, could be a new era of peace and brotherhood.

But what appears certain is that working people (and that obviously includes the temporarily unemployed) deserve free lunches. Finally getting them some money back from a tax system which they have paid into is such a radical idea in neoliberal America that whoever proposes it will surely sweep into the White House. It’s amazing Biden hasn’t jumped all over this already – if only to make sure Trump does not – but then we remember that he is the senior senator from Delaware, one of the world’s biggest tax havens.

Can Trump put aside his conservative fiscal principles (if he we now believe that he has actual “principles” other than self-interest) to realise that extending unemployment is a sure-fire way to win votes?

To reformulate more accurately: Will we see a revival of the Trump who was willing to buck the Republican Party, a stance which got him elected in the first place?

In my second article on the corona crisis I seized upon this very idea – Trump as Huey Long: Corona meds in every pot & a People’s QE: the Trumpian populism they hoped for? Of course I did: as a socialist I cling to the very un-radical but very un-American belief that government leaders can actually design their policies with the lower classes in mind. Of course as someone who does not believe in Western liberal (aristocratic) democracy I am not a Trump supporter, I was and am merely a journalist commenting on the news and musing as to how history could maybe turn out.

The PR campaign for Trump writes itself: Vote for the man who kept you off the street after corona, and now let’s really drain the swamp.

The perhaps fatal flaw in my Long comparison is this: Trump has never been the outsider economic populist his anti-free trade stance indicated. Hopes that Trump is a real populist – which fake-leftist Democrats, the 1% and the MSM fear with such horror – have certainly not been redeemed. After 3.5 years we still have no proof that Trump is going to use his bloated executive powers (normal in the 21st century Western “liberal strongman” balance of power conception) to aid the lower classes.

I have read of Chinese analysts who say, “Well, maybe if Trump can get re-elected then he can finally shed the war hawks – forced on him via the Russophobia campaign – and get back to the art of the political deal.” That’s half-based on the same premise: that somewhere a populist, patriotic, non-warmongering Trump is hiding.

However, the other half of this analysis is based around the same “hope” of 2016: it’s better to have a wild and crazy hope like Trump than to continue with the depressing certainty of what a “mainstream” US president will surely wreak. Militarist “pivots to China” after winning the Nobel Peace Prize, bombing many Muslim countries and other such phoniness….

If Trump wants to win re-election – which seems impossible for an incumbent amid such Herbert Hoover-like devastation – Trump has to do a 180 and finally embrace his inner FDR… if there is one? It’s too bad a Hail Mary miracle pass is all you can hope for in the hopelessly reactionary American system.

But that’s really true of all Western liberal (aristocratic) democracy: if Marine Le Pen wins in 2022 we’ll likely be hoping for a very same political-deathbed conversion in 2026.

Corona is ruining Trump, yes, but he’s forgetting two key things: 1) it’s ruining absolutely everyone else, and 2) no citizen of the US has more power to act as a saviour than he does, as he is still the president.

If Trump can’t see that a simple (and equitable, and democratic) way to win re-election is by pacifying a rightly panicked populace with a continued good dole then… maybe he really is just an idiot? Or he’s just another American politician whose secret/subconscious economic ideology is the mainstream corporate fascism.

You can’t blame anyone anywhere for hoping against hope that’s not true.

*********************************

Corona contrarianism? How about some corona common sense? Here is my list of articles published regarding the corona crisis.

Capitalist-imperialist West stays home over corona – they grew a conscience? – March 22, 2020

Corona meds in every pot & a People’s QE: the Trumpian populism they hoped for? – March 23, 2020

A day’s diary from a US CEO during the Corona crisis (satire) March 23, 2020

– March 25, 2020

Tough times need vanguard parties – are ‘social media users’ the West’s? –

March 26, 2020

If Germany rejects Corona bonds they must quit the Eurozone – March 30,

2020

Landlord class: Waive or donate rent-profits now or fear the Cultural Revolution – March 31, 2020

Corona repeating 9/11 & Y2K hysterias? Both saw huge economic overreactions – April 1, 2020

(A Soviet?) Superman: Red Son – the new socialist film to watch on lockdown – April 2, 2020

Corona rewrites capitalist bust-chronology & proves: It’s the nation-state, stupid – April 3, 2020

Condensing the data leaves no doubt: Fear corona-economy more than the virus – April 5, 2020

‘We’re Going Wrong’: The West’s middling, middle-class corona response – April 10, 2020

Why does the UK have an ‘army’ of volunteers but the US has a shortage? – April 12, 2020

No buybacks allowed or dared? Then wave goodbye to Western stock market gains – April 13, 2020

Pity post-corona Millennials… if they don’t openly push socialism – April 14, 2020

No, the dollar will only strengthen post-corona, as usual: it’s a crisis, after all – April 16, 2020

Same 2008 QE playbook, but the Eurozone will kick off Western chaos not the US – April 18, 2020

We’re giving up our civil liberties. Fine, but to which type of state? – April 20,

2020

Coronavirus – Macron’s savior. A ‘united Europe’ – France’s murderer – April 22, 2020

Iran’s ‘resistance economy’: the post-corona wish of the West’s silent majority (1/2) – April 23, 2020

The same 12-year itch: Will banks loan down QE money this time? – April 26,

2020

The end of globalisation won’t be televised, despite the hopes of the Western 99% (2/2) – April 27, 2020

What would it take for proponents to say: ‘The Great Lockdown was wrong’? – April 28, 2020

ZeroHedge, a response to Mr. Littlejohn & the future of dollar dominance – April 30, 2020

Given Western history, is it the ‘Great Segregation’ and not the ‘Great Lockdown’? – May 2, 2020

The Western 1% colluded to start WWI – is the Great Lockdown also a conspiracy? – May 4, 2020

May 17: The date the Great Lockdown must end or Everything Bubble 2 pops – May 6, 2020

Reading Piketty: Does corona delay the Greens’ fake-leftist, sure-to-fail victory? – May 8, 2020

Picturing the media campaign needed to get the US back to work – May 11, 2020

Scarce jobs + revenue desperation = sure Western stagflation post-corona – May 13, 2020

France’s nurses march – are they now deplorable Michiganders to fake-leftists? – May 15, 2020

Why haven’t we called it ‘QE 5’ yet? And why we must call it ‘QE 2.1’ instead – May 16, 2020

‘Take your stinking paws off me, you damned, dirty public servant!’ That’s Orwell? – May 17, 2021

The Great Lockdown: The political apex of US single Moms & Western matriarchy? May 21, 2021

I was wrong on corona – by not pushing for a US Cultural Revolution immediately – May 25, 2021

August 1: when the unemployment runs out and a new era of US labor battles begin – May 28, 2021

Corona proving the loser of the Cold War was both the USSR & the USA – May 30, 2021

Rebellions across the US: Why worry? Just ask Dr. Fauci to tell us what to do – June 2, 2021

Protesting, corona-conscience, a good dole: the US is doing things it can’t & it’s chaos – June 3, 2021

Why do Westerners assume all African-Americans are leftists? – June 5, 2020

The US as Sal’s Pizzeria: When to ‘Do The Right Thing’ is looting – June 6, 2020

The problem with the various ‘Fiat is all the problem!’ (FIATP) crowds – June 9, 2020

Politicisation of Great Lockdown result of ‘TINA’ economic ignorance & censorship – June 14, 2020


Ramin Mazaheri is the chief correspondent in Paris for Press TV and has lived in France since 2009. He has been a daily newspaper reporter in the US, and has reported from Iran, Cuba, Egypt, Tunisia, South Korea and elsewhere. He is the author of the books Ill Ruin Everything You Are: Ending Western Propaganda on Red China’ and the NEW Socialisms Ignored Success: Iranian Islamic Socialism.

Weimar 2020

 BY GILAD ATZMON

weimar 2020.jpg

By Gilad Atzmon

Have you noticed the peculiar fact that despite the lockdown, the economic crisis, tens of millions unemployed and multiple corporations filing for bankruptcy, Wall Street is having a ball? CNBC‘s Jim Cramer examined this anomaly earlier a few days ago, his verdict:  “we’re looking at a V-shaped recovery in the stock market, and that has almost nothing to do with a V-shaped recovery in the economy. What is going on is one of the greatest wealth transfers in history.”

Jim Cramer: The pandemic led to ‘one of the greatest wealth transfers in history’ https://youtu.be/15pFQxG9wko

 How can the market rebound when the economy has not?  Cramer’s answer is so simple. “Because the market doesn’t represent the economy; it represents the future of big business.”

 Cramer points out that while small businesses are dropping like flies, big business—along, of course, with bigger wealth, is coming through the crisis virtually unscathed.

 Cramer projects that the transfer will have a “horrible effect” on the USA. We are already seeing a tsunami of bankruptcies. The economic fallout is inevitable. Federal data shows that the nation faces a 13.3 percent unemployment rate. The fortunes of U.S. billionaires increased by $565 billion between March 18 and June 4 while the same 11-week period also saw 42.6 million Americans filing jobless claims. The results are devastating, if hardly a news item: while the American people are getting poorer, the rich are getting richer.

 One would have thought that the American Left and progressive political institutions would be the first to be alarmed by these developments. We tend to believe that tempering the rich and their greed, caring for working people and fighting for equal opportunities and justice in general are the Left’s prime concerns.

The American reality,  however, suggests the opposite. Instead of uniting us in a fierce battle against Wall Street and its broad daylight robbery of what is left of American wealth, the American Left is investing its last drops of  political energy in a ‘race war.’ Instead of committing to the Left’s key ideological values, namely: class struggle that unites us into one angry fist of resistance against this theft and discrimination, and without regard to our race, gender, or sexual orientation, the American Left makes us fight each other.

 The  silence of the Left on the current Wall Street “wealth transfers” is hardly an accident.  American Left and Progressive institutions are supported financially and by Wall Street and global financiers. This funding means that, in practice, the American Left  operates as a controlled opposition. It maintains its relevance by sustaining social and racial tensions that draw attention away from Wall Street and its crimes. The so called ‘Left’ is also reluctant to point at  Wall Street and its current theft,  as such criticism, however legitimate,  would immediately be censured as ‘antisemitic’ by the Jewish institutions that have appointed themselves to police Western public discourse.

 There is plenty of  history of such divisive politics from the Left and the way it often ends up betraying the Working Class. The collapse of the German Left in the early 1930s is probably the most interesting case-study of this. 

 Prior to the 1929 economic collapse, Germany’s fascist movement was a relatively marginal phenomenon consisting of various competing factions. In the 1928 elections the Nazi Party received 2.8 percent (810,000 votes) of the general vote. But then the 1929 crash led to a rapid and sharp rise in unemployment;  from 1.2 million in June 1929 to 6 million in January 1932. Amidst the crisis, production dropped 41.4 percent from 1929 to the end of 1931, resulting in skyrocketing poverty.  Like millions of Americans at the moment, in the early 1930s millions of Germans spent many days and nights in food queues.

 One would assume that the collapse of capitalism would have been politically celebrated by the German Communists and Marxists as the Germans lost hope in ‘bourgeois democracy’ and capitalism alike.  The German Communist Party (KPD), like the Nazi party,  increased its power exponentially following the economic meltdown. Yet the German Left missed its golden opportunity. Despite the poverty and the austerity measures, it was Hitler who eventually won the hearts and the souls of the German working class. By the September 1930 election Hitler had won 18.3 percent  and then in July 1932 37.4 percent. In just four years the Nazis increased their support by 13 million votes.

 A lot has been written about the failure of the German Left, both Marxists and Communists, to tackle Hitler and Fascism. Some Marxists are honest enough to admit that it was actually the KPD, its authoritarian and divisive politics that paved the way for Hitler and Nazism.

 Like Stalin, the German KPD was quick to employ the term  ‘fascist’ to describe any and all political opponents. In an act of gradual self-marginalisation, the German Left reduced itself into irrational political noise that finally lost touch with reality. The KPD were so removed from understating the political transition in Germany that on January 30, 1933, the day Hitler was appointed Chancellor of Germany, the KPD foolishly declared: “After Hitler, we will take over!”

 Like the American radical  Left today, the KPD fought in street battles against the Nazis from 1929 to 1933.  These battles cost the lives of  hundreds of Nazis and KPD members. But in 1933 no political group paid as high a price in blood as the KPD. Nearly  a third of KPD members ended up in prison.  

 It is notable that one of the most concerning aspects of Left politics is the peculiar fact that agitators who claim to be inspired by ‘dialectics’ appear blind to their own ideological past. Consequently, they are detached from the present and totally removed from a concept of ‘future.’

 I have been saying for some time that Trump often makes the right decisions if always for the wrong reasons. For instance, he declared ‘a war’ on social media authoritarianism in the name of the 1st Amendment. Though this is clearly the right result, Trump is not motivated by any genuine concern for ‘freedom of speech’ or ‘human rights’ he is simply upset that his tweets are subject to ‘fact checks.’ The Left, peculiarly enough, tends to make the wrong decisions if usually for good reasons. Fighting racism is, no doubt, an important goal; Combating America’s police brutality or racial discrimination is a major crucial battle, however, fuelling a race conflict is the worst possible path toward eliminating both racism and discrimination. Such a tactic will only deepen the divide that already splits the American working class. I wonder whether this divide is exactly what the American Left is trying to achieve: is this possibly what it is paid to do?

 Today as American progressives and leftists  gear up for a long relentless battle, I have a little advice to offer. History teaches us that Fascism always wins when the conditions for a Marxist revolution are perfect. When you push for a race conflict and further fragmentation of the American society, bear in mind that you may end up facing a real Trump character (as opposed to Donald) that may be able to unite America and make it great for real, but you won’t find your place in it.   


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The Illusion of Economic Recovery Began in the US

By Stephen Lendman

Global Research, June 07, 2020

Protracted main street depression conditions have existed in the US since 2008 with no relief for ordinary Americans in prospect.

Before economic collapse this year, unemployment exceeded 20%, Labor Department numbers rigged to pretend otherwise.

The so-called U-3 BLS number omits working-age Americans without jobs who want them, including many longterm unemployed individuals not looking after months of failure to find employment.

Monthly BLS jobs report conceal what should be headline news, including that most US jobs created are poverty-wage, poor-or-no benefit temporary or part-time service industry ones.

Most households need two or more to survive. Living on the edge, they’re one or a few missed paydays from homelessness, hunger, despair and overall deprivation.

Record numbers of Americans are food insecure, the specter of hunger haunting the world’s richest country because its ruling class serves privileged interests exclusively at the expense of the public welfare.

It’s what the scourge of neoliberal harshness is all about, supported by both right wings of the one-party state.

It’s not a pretty picture. “America the beautiful” is a mirage in a nation where poverty is the leading growth industry — disturbing reality concealed by establishment media.

Michal Harrington explained the problem in 1962, things far worse today than what he described in his book titled “The Other America,” saying:

“In morality and in justice, every citizen should be committed to abolishing the other America, for it is intolerable that the richest nation in human history should allow such needless suffering.”

“But more than that, if we solve the problem of the other America, we will have learned how to solve the problems of all of America.”

Food insecurity, hunger, and unemployment haunted America at higher levels than at any time since the Great Depression before 2020 economic collapse began.

Now they’re off the charts with no near-or-longer-term plan for turning things around — just continued governance of, by, and for the privileged few alone at a time of a growing permanent underclass.

During the Great Depression, FDR explained that “one-third of (the US was) ill-housed, ill-clad (and) ill-nourished” — the problem far greater today than then.

It’s because unemployment is far greater now than in the 1930s, the highest in US history by far.

FDR’s “New Deal for the American people” was polar opposite today’s bipartisan conspiracy against public health and welfare.

He called “vast unemployment (of his time) the greatest menace to our social order,” calling for “social justice” that’s fast eroding today at a time when boosting it greatly is needed.

Friday’s jobs report concealed reality. Economist John Williams said BLS numbers are “not particularly credible.”

“Prior period downside revisions” weren’t explained, nor “revised methodologies and seasonal adjustments” that distorted reality.

Nearly 5 million unemployed Americans were counted as “employed, the third (consecutive) month of acknowledged misreporting.”

Last month’s reporting period was at a time of US lockdown nationwide.

Yet the BLS claimed 2.5 million new jobs were created — when millions of new weekly unemployment claims continue to be filed.

The report noted that hundreds of thousands more workers were permanently laid off because lost business isn’t coming back soon.

Hundreds of thousands of public workers continue to be let go, mostly at the state and local levels because of severe budget constraints, revenues falling way short of the ability to maintain public services at pre-economic crisis levels.

Through May into early June, data show the US economy contracting, far from expanding.

Key economic metrics contracted to record-low levels. Q II GDP is estimated to show around a 50% contraction, a number far exceeding anything during the Great Depression or any previous time in US history.

Based on how US unemployment was calculated pre-1990, Williams now puts it at 35%, over one-third of US workers without jobs.

Along with the vast majority of others underemployed, the US is a nation of paupers while its privileged class never had things better.

Notably the wealth of super-rich Americans is increasing during hard times while food banks are hard-pressed to feed millions of hungry Americans.

The USA is a nation in decline, a surging stock market concealing reality.

The Economic Policy Institute (EPI) said nationwide “economic pain” continues, stressing it’ll “be longstanding without” considerable federal aid — that’s not forthcoming.

California, the state with the nation’s largest economy, teeters on bankruptcy, needing $54 billion in federal aid to provide basic services.

Many are being slashed, including for health, education, and other vital programs.

New York, Illinois and other US states are face similar hard choices.

Instead of federal aid to states in need and to stimulate economic growth and jobs creation, trillions of federal dollars went to Wall Street and other corporate America favorites.

Crumbs alone have gone to the unemployed, the impoverished underemployed, the “ill-housed, ill-clad, and ill-nourished.”

While most US states ended lockdowns, others likely to end them in short order, mass unemployment remains at a record high.

Over 40 million Americans employed in January were fired, laid off, or furloughed, record numbers over a short period.

Small and medium-sized businesses were most affected, the backbone of the nation.

Around half of lost jobs are permanent because countless numbers of shut down companies face bankruptcy.

The Wall Street Journal reported that 722 US firms filed for Chapter 11 bankruptcy in May alone, a near-50% year-over-year increase, much more of the same ahead.

Many reopening won’t operate at previous levels, notably restaurants, hotels, airlines, shopping malls, retail stores, commercial real estate, enterprises related to tourism, and others relying on large gatherings like sports.

According to US bankruptcy attorney James Conlan, “we’re going to see an extraordinary number of large corporate bankruptcies, not just in the US but across the globe.”

The effects of unprecedented US economic collapse won’t magically turn around any time soon — especially with no federal economic stimulus and jobs creation programs planned.

Trump’s phony Friday claim about the US economy ready to take off like a “rocket ship” belies the dismal state of main street America — his regime and Congress doing nothing to turn things around.

What happens when millions of unemployed Americans can’t pay mortgage, car loans, or credit card bills.

Are mass evictions coming, numbers of homeless to increase exponentially, along with growing hunger?

The notion that Friday’s jobs report showed the beginning of economic recovery is belied by reality in US cities and towns nationwide.

Ongoing protests against institutionalized racism, inequality and injustice met by police violence reflect America’s dismal state.

It’s not about to change by the nation’s ruling class without sustained public activism in the streets for redress of longstanding grievances.

It’s the only way change ever comes. There’s no other way.

Power yields nothing without a demand. It never did and never will.

*

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Award-winning author Stephen Lendman lives in Chicago. He can be reached at lendmanstephen@sbcglobal.net. He is a Research Associate of the Centre for Research on Globalization (CRG)

His new book as editor and contributor is titled “Flashpoint in Ukraine: US Drive for Hegemony Risks WW III.”

http://www.claritypress.com/LendmanIII.html

Visit his blog site at sjlendman.blogspot.com.

Featured image is from Charleston’s The Digitel | CC BY 2.0The original source of this article is Global ResearchCopyright © Stephen Lendman, Global Research, 2020

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