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Neoliberalism as a New, More Dangerous, Form of Corporatism

Neoliberalism = Casino Capitalism = "Transnational elites, Unite!"
(It is a neoTrotskyism with the word "proletarians" substituted by the word "elites"
 in famous "Proletarians of all countries, Unite!" slogan
and "Color revolutions" instead of Communist  "Permanent revolution"  )

Version 5.0

Skepticism and Pseudoscience  > Who Rules America > Neoliberal Brainwashing

News Who Rules America Recommended books Recommended Links Neocolonialism as Financial Imperialism Definition of neoliberalism Globalization of Financial Flows
Neoliberalism as Trotskyism for the rich Neoliberalism and Christianity Pope Francis on danger of neoliberalism Casino Capitalism Neoliberal Brainwashing Neoclassical Pseudo Theories Ayn Rand and Objectivism Cult
Globalization of Corporatism Lawrence Summers Robert Rubin, the man who helped to convert the USA into banana republic Phil Gramm Ronald Reagan: modern prophet of profligacy Sandy Weill: the banker who bought Bill Clinton Milton Friedman -- the hired gun for Deification of Market
Media-Military-Industrial Complex Neo-fascism New American Militarism Neocons Corporatist Corruption: Systemic Fraud under Clinton-Bush-Obama Regime Psychological Warfare and the New World Order: The Secret War Against the American People Gangster Capitalism
Financial Crisis of 2008 as the Crisis of Neoliberalism and shift to neo-fascism Peak Cheap Energy and Oil Price Slump Financial Sector Induced Systemic Instability of Economy Corruption of Regulators In Goldman Sachs we trust: classic example of regulatory capture by financial system hackers The Deep State Deconstructing neoliberalism's definition of 'freedom'
Elite Theory The Iron Law of Oligarchy Compradors Fifth column Color revolutions Anti-globalization movement Inverted Totalitarism
Super Capitalism as Imperialism Alternatives to neoliberalism If Corporations Are People, They Are Psychopaths Jeremy Grantham On The Fall Of Civilizations Psychological Warfare and the New World Order Neoliberalism as a Cause of Structural Unemployment in the USA Neoliberalism and inequality
Neoliberal corruption "Fight with Corruption" as a smoke screen for neoliberal penetration into host countries IMF as the key institution for neoliberal debt enslavement Blaming poor and neoliberalism laziness dogma Predator state Disaster capitalism Audacious Oligarchy and "Democracy for Winners"
The Great Transformation Harvard Mafia Two Party System as polyarchy Republican Economic Policy Monetarism fiasco Small government smoke screen Over-consumption of Luxury Goods as Market Failure
Libertarian Philosophy Media domination strategy Neoliberal Brainwashing -- Journalism in the Service of the Powerful Few In Foreign Events Coverage Guardian Presstitutes Slip Beyond the Reach of Embarrassment History of neoliberalism Humor Etc


Even though I agreed with him, I warned that whenever someone tried to raise the issue, he or she was accused of fomenting class warfare. “There’s class warfare, all right, "Mr. Buffett said, “but it’s my class, the rich class, that’s making war, and we’re winning."

- New York Times

Make no mistake, the neo-Liberal fuckers are just as bad as the Stalinists

May '68 and its Afterlives [Review]

GB: once a great cultured nation, now a poorly-educated gangster mafia state, ruled by oligarchs and inhabited by soccer hooligans

The Kremlin Stooge


Introduction

Neoliberalism is not a post-war version of capitalism. It’s a post-war version of fascism.

washunate September 10, 2015 at 2:05 pm; comment to the post

David Kotz: Understanding Contemporary Capitalism, Part I

Neoliberalism is a new form of corporatism based on the ideology of market fundamentalism, dominance of finance in the economy (and restoration of the political power of financial oligarchy) and cult of the rich ("greed is good") instead of ideology based on racial or national superiority typical for classic corporatism. Like many religious doctrines it belongs to the class of Theological Voluntarism (with some pseudo mathematical voodoo attached as a justification; actually even this is not new. Iranian ayatollahs in the past needed to demonstrate proficiency in mathematics) , but unlike most philosophies and religions it does not try to suppress greed. On the contrary it pronounces it to be a virtue ("Greed is good"). It simply profess that all actions of the elite  need to be covered under smokescreen of propaganda which is unprecedented in its cynicism, hypocrisy and contempt to the ordinary people.  Probably exceeding cynicism of the USSR leadership which promoted  the same redistribution of wealth up  ( in case of the USSR mainly to military industrial complex and nomenklatura )  using Big Brother style slogans like  "The Party cares for the wellbeing of the people".  This is a tailor-made ideology for financial oligarchy and  large international corporations who simply want to to carve the "economic cake"  on the whole globe. They created a political system that is the very opposite of what our leadership, the mass media, opinion leaders, think tanks etc. proclaim to be the world's foremost, exemplary democracy.

While neoliberalism (or "corporations uber alles" as we can call it) proved to be a more dynamic social system then stagnant "Brezhnev's socialism" which it successfully destroyed (with the whole "Socialist camp"), it is one step forward two steps back in comparison with New Deal type of capitalism and, especially, social democracies of Scandinavian countries.  Which neoliberalism also successfully destroying.  At the same time like communism this is another "universalist ideology" based on false hopes. Similar to communist expansion( Trotsky idea of "permanent revolution") the neoliberal world now is preoccupied with the neoliberal expansionism, with the opening of foreign markets for transnational corporations.  Like with Communism,  imperial ambitions are not only territorial; they are also ideological. This ideology, or is you wish, secular religion (there is nothing scientific in neoliberal doctrine, especially in economic part of it) can be exported to any country via so called color revolutions. Unlike classic colonialism neoliberal occupation is not dependent on direct occupation of the country by military forces.  It's more like financial occupation via debt slavery (neocolonialism) and it uses as local occupying force the part of local elite closely connected to transnational corporations and storing their financial assets in Western banks.  Neoliberalism proved that the empire could be successfully expanded not only by conquest but via co-optation of a part of the local elites (aka fifth column of globalization).

In way neoliberal is a unique social system that mobilized the power of greed (in a very destructive for the society way) while most previous social system tried to suppress it. Usury laws are an example which were revoked under neoliberalism (payday loans is plain vanilla usury; credit card debt is close). The only criteria of any activity is economic success (which closely relates neoliberalism to Marxism, which similarly viewed as economics as primary force of progress of human civilization and social "superstructure" as secondary element in human societies which automatically reflects the economic base). As an economic doctrine neoliberalism  repudiates Keynesian welfare state economics and promoted the "law of jungle" principles using bought ideologues like Milton Friedman and earlier by the dubious fighter for economic freedom  Friedrich von Hayek. In other words it favor of "dog eats dog" forms of competition which were the hallmark of early capitalism (Austrian aristocrat Friedrich von Hayek probably would have a stoke if he saw the current "dog eats dog" implementation of his ideas).

Commonly under the term "neoliberalism" we understand a set ideas such as a radically free market, maximized competition and free trade achieved through economic de-regulation, elimination of tariffs, a range of monetary and social policies favorable to business and indifferent toward poverty, adopting explicit policies redistribution of wealth up via casino properties of stock market (which is a central institution of neoliberal order), cultural decimation, acceleration of Earth resource depletion and environmental destruction due to the "race to the bottom"  in increasing profits by any means possible. But it is more then that. Like Marxism and most world religions neoliberalism provides humans with what is called " neoliberal rationality" which organizes the world view of adherents to neoliberalism. It reaches beyond the market. Neoliberal rationality defines human beings as market actors (homo economicus). All dimensions of human life are cast in terms of a market relations. Actions and policies are reduced to the bare question of profitability. For example under neoliberalism universities became service provider with the primary goal of profitability not enhancing the society knowledge and preparing educated citizens. It becomes a narrow, overspecialized preparation for entering the "job market". and explicitly design to produced narrow minded individuals, who never question the social system they live in and who view themselves as entrepreneurs (privileged set of market actors, above regular employees) and who know only Excel calculations of profitability, the rules of competition and are ready to play it hard to get themselves a space under the sun in dog eats dog game. 

In other words neoliberalism subvert university education like other institutions into instruments for developing, dissimilating and institutionalizing such a rationality. Exactly like universities in the USSR were structured to indoctrinate students in Marxism orthodoxy. Neoliberals reject the idea that the economy must be directed and protected by society laws and policy as well as by the dissemination of social norms designed to facilitate not only competition but cooperation as well. universities used to teach its students to consider the costs, benefits, and consequences of individual action in view of the "society at large".  The need to support for the vulnerable and needy. This set of ideas is completely withdrawn. Poor are guilty themselves for their miserable status. and should  better die, not to crowd the Earth surface. Everybody is on his/her own. As Thatcher quipped: “There is no such thing as society. There are individual men and women, and there are families

Political citizenship is radically reduced within the neoliberal framework to unprecedented degree of passivity and political complacency. The role of citizen is downgraded to consumption: "go shopping" was the famous Bush Ii recommendation after 9/11.  elections were emasculated to the choice of two preselected representative of the ruling elite (Two Party System as Polyarchy) selection of which is fully controlled by ruling oligarchy (in the USA via monetary mechanism as candidates need a "war chest" to run in elections which typically can come only from the powers that be). 

Even nation-states must think and behave like a market actors. The languages of cost-benefit analysis and calculation sweep into governmental decision-making. In the "neoliberal rationality" the health and growth of the economy (with absolutization of GDP) is the only basis of legitimacy of the state. The slogan is  “It’s the economy, stupid.

"Economic colonization" of the life under neoliberal ideology sometimes reached grotesque forms with even dating analyzed in market terms, with marriage as the final compromise of the "deal". 

Neoliberalism like Marxism before it is truly expansionist ideology with global ambitions. Like was the case with Marxism there is no "rational" limit to the neoliberal global expansion (actually only the size of  the planet Earth is the limit). Neoliberal states and especially the USA as the center of global neoliberal empire are aggressive globalists in very precise meaning of this word (with the stress of the word "aggressive")  and wants to overthrow each and every government which is not friendly enough to "Washington consensus" (neoliberal charter for all countries outside G7).  For this purpose the mechanism of overthrowing foreign governments via close interaction of local fifth column and intelligence agencies of the USA and several other Western countries called "color revolution" was invented and polished via repeated coups in various part of the globe.

Color revolutions performed under the banner of democracy and  liberty could not easily stopped by governments of many third world and xUSSR countries as they undermine legitimacy of the government in a very vicious way: pretending that such a revolution is not a tool of neoliberal occupation of the country but genuine fight for the  "spread of democracy". Yet, the neoliberal experience on many country that experienced neoliberal revolutions directed by State Department now clearly see that spread of neoliberalism is in reality a neocolonial expansion had crippled traditional institutions as well as national social security net in the colonized countries and brutally enforced exploitative foreign ownership of country strategic resources. All that creates huge level of inequality of population and a great divergence in the standard of living between neoliberal center (G7) and neoliberal periphery. Poverty as well as arrested economic development, if not under-development and sliding into debt slavery (with gentle encouragement of IMF) are common. 

The process of transition from a neoliberal colony status to sustainable independence is currently uncharted territory. Only few countries made significant steps in this direction (Russia is one example although progress  is limited and it remains "a second rate" neoliberal country (it entered WTO under Putin) not allowed to the club of "prime" neoliberal countries; there are also some steps in Latin American countries in the same direction, but due to proximity of the USA and absence of nuclear deterrent for neoliberal aggression their position is more fragile and success can be temporary.

As of 2015 neoliberalism remains the dominant social ideology and practice in the world.  It survived and entered in "non-dead" (zombie) stage after 2008 crisis (see The Strange Non-death of Neo-liberalism by Colin Crouch). It is till expanding and trying to colonize new states into global neoliberal empire (Libya and Ukraine are two recent examples).

At the same time after approximately 35 years of being dominant in world (if we assume that 1980 was the year then neoliberalism came to power in the USA; in reality it happened earlier under Carter  and Chile coup of 1973 was the first country converted into neoliberal governance) is shows some significant cracks.  So we can think about neoliberalism coming to power in the USA in 1965 with the establishment of free trade zones and Mexican maquiladoras (factories that produce for export) under so called the Border Industrialization Program which makes it 50 years old.

In any case neoliberalism now is close to the longevity as the New Deal Capitalism (1933-1980). And unless oil price goes through the roof (undercutting globalization) neoliberalism in the USA has chances to outlive socialism in Soviet Russia which lasted 74 years (1917-1991), as there is no viable countervailing force on the horizon. Opposition to the new world order by resource nationalists (like Putin) and Catholic church does not cardinally changes this situation. After all Russia by all accounts is still "yet another neoliberal state" (the same is true for China).  It entered WTO under Putin. Russian elite, like German elite just want a better place in neoliberal world, which was denied for them by the USA and other Western European elites.

Formally we can view neoliberalism as a flavor of corporatism (in sense that corporations are dominant political actors -- as Senator Dick Durbin aptly quipped about US Congress "Banks frankly own the place").  As such it might be  more properly called neo-corporatism and it is district from classic corporatism which rely of dominant political party and suppression of dissent by force by using indirect "iron fist in soft glove" methods based on the power of finance (see  Inverted Totalitarism). While rhetoric of Lebensraum im Osten and natural selection (like in "separating incompetent or systematically unlucky people from the control of valuable resources") is not unique to neoliberalism, it is neofascist  in spirit  (see neofascism and  National Socialist Program).  While globalist in nature, it paradoxically stimulates growth of local far right or openly neofascist parties (as we see in Greece, Hungary, Israel and Ukraine).

Under neoliberalism the wealthy and their bought academic servants, see inequality as a noble outcome. University professors of economics form the most corrupt part of intellectual elite – they are nothing more than employees of the financial oligarchy paid to administer intellectual anesthetic to those among debt slaves, who still have enough time to ask what’s going on. For a relatively modest (in comparison with politicians like Hillary Clinton)  remuneration they help to enrich top 1%, shrink middle class making it less secure, and impoverish poor.  Please note that redistribution of wealth up is an officially stated goal. In 1992, when asked what Iran-Contra operation was really all about, Bush I replied that it was done for "...the continuous consolidation of money and power into higher, tighter and righter hands."

Neoliberalism enjoyed strong political ascendance since 1980th, although ideology is much older and its origins can be traced to first decade after WWII; the seeds were firmly planted in 1965 with the establishment of free trade zones and Mexican maquiladoras (factories that produce for export) under so called the Border Industrialization Program. Even at this, early stage the key feature of neoliberalism were evident -- outsourcing labor to the third word countries, as the method of undermining power of unions in the USA. Along with the elimination of unions, classic neoliberalism promotes reduced taxation of rich and corporations, reduced regulation, and minimizing redistributive function of government and favoring the rich and powerful elite and first of all financial oligarchy. This minimization of government functions is not about the reduction of military budget, but about dismantling of safety net established under New Deal, including the privatization of health and retirement benefits. In countries outside the USA neoliberalism is also a strong proponent of opening up of the economy to foreign competition. Supporters of neoliberalism created real "fifth column" out of universities economic departments with small targeted grants and various forms of corruption of large percentage of professors (speaking engagements, higher salary, exorbitant consulting fees, etc).

In its essence neoliberalism was a counterrevolution aimed at destroying established after WWII compromise between workers and capitalists based on state capitalism model, which in the US was called the New Deal.  In most simple form neoliberalism can be defined as an attempt to restore the rule of international financial oligarchy over society, as a new form of corporatism, of, if you like, neofascism (not always velvet gloves for countries outside G7; see Pinochet history of repression in Chile, for example) .  Unlike classic forms of corporatism such as German and Italian fascism here we do not see the dominant nationalistic, far right political party that suppresses all the political opponents. Instead this is an organized movement of the top echelon of corporations and, first of all, global/transnational corporations, who decided to enforce the same indirect and mostly economic form of  control over population that were polished within corporate environment and in battles with the unions. It  can be called "fascism without nationalism". Such social system also sometimes was called Inverted Totalitarism, "casino capitalism", or "fascism in velvet gloves".

As a social system neoliberalism is a derivative, a new form of classic corporatism and involves complete dominance of large corporations over government, including but not limited to conversion of goals of multinationals into state foreign policy goals (achievable by wars, if other means fail). The usurpation of large multinationals of political life of the country is achieved mainly by economic means, but assassinations of "non-conformant" political leaders are not excluded as "deep state" is a part of neoliberal power structure and has capabilities of physically eliminating opponents.  Still the main form is by buying politicians and key intellectuals as well as controlling all major political appointments (including the selection of Presidential Candidates). In a way the society became "occupied" in a very precise meaning of this word (and that's why "Occupy Wall Street" movement is misnomer; it should be called anti-occupation movement). Citizens and most countries are transformed into indented servants of large corporations and their economic and political interests.

Debt slavery is the standard, preferred tool of neoliberal control both over individuals and countries. One of the key strategy of subduing the countries by bringing to power neoliberal elite (fifth column of globalization) as well as enforcing on the country large unplayable debt. Essentially converting such a country into debt slave rules by vassal government, which oversee transfer of funds to metropolia.  Thos model replaces direct occupation model used by British and other empires. 

Greece and Ukraine are two most recent examples of this policy in action. Typically this is done with giving the country large loans for questionable projects, and large part of allocated money is promptly stolen by local neoliberal elite. Then when crisis struck and institutions that took the load can't pay, they are bailed out by  converting those loads from private to public via IMF. This is the key mechanism of redistribution of wealth -- profits are private, but losses s are public.

From the other point of view we can view neoliberalism as the next stage of corporatism, as corporatism that had outgrown national boundaries and became global. In other words in 70th of the last century, the civilization made an interesting turn, returning to the state where a supranational structures, which in the middle ages were called religious orders, returned to the prime scène in the form of transnational corporations, IMF (which represents interests of US financial oligarchy) and World Bank with budgets that exceed the GDP of most States and political influence, exceeding traditional political influence of international institutions such as UN, UNESCO, etc.   An interesting nuance is that national three letter agencies also became important players in this new global governing corporatist alliance, acquiring a political role similar to transnational corporations as the key part of National Security State and forming the core of so called "deep state":

Yes, there is another government concealed behind the one that is visible at either end of Pennsylvania Avenue, a hybrid entity of public and private institutions ruling the country according to consistent patterns in season and out, connected to, but only intermittently controlled by, the visible state whose leaders we choose. My analysis of this phenomenon is not an exposé of a secret, conspiratorial cabal; the state within a state is hiding mostly in plain sight, and its operators mainly act in the light of day. Nor can this other government be accurately termed an “establishment.” All complex societies have an establishment, a social network committed to its own enrichment and perpetuation. In terms of its scope, financial resources and sheer global reach, the American hybrid state, the Deep State, is in a class by itself. That said, it is neither omniscient nor invincible. The institution is not so much sinister (although it has highly sinister aspects) as it is relentlessly well entrenched. Far from being invincible, its failures, such as those in Iraq, Afghanistan and Libya, are routine enough that it is only the Deep State’s protectiveness towards its higher-ranking personnel that allows them to escape the consequences of their frequent ineptitude. [2]

... ... ...

The Deep State does not consist of the entire government. It is a hybrid of national security and law enforcement agencies: the Department of Defense, the Department of State, the Department of Homeland Security, the Central Intelligence Agency and the Justice Department. I also include the Department of the Treasury because of its jurisdiction over financial flows, its enforcement of international sanctions and its organic symbiosis with Wall Street. All these agencies are coordinated by the Executive Office of the President via the National Security Council. Certain key areas of the judiciary belong to the Deep State, such as the Foreign Intelligence Surveillance Court, whose actions are mysterious even to most members of Congress. Also included are a handful of vital federal trial courts, such as the Eastern District of Virginia and the Southern District of Manhattan, where sensitive proceedings in national security cases are conducted. The final government component (and possibly last in precedence among the formal branches of government established by the Constitution) is a kind of rump Congress consisting of the congressional leadership and some (but not all) of the members of the defense and intelligence committees. The rest of Congress, normally so fractious and partisan, is mostly only intermittently aware of the Deep State and when required usually submits to a few well-chosen words from the State’s emissaries.

The American and British elite in 70th (starting with President Carter in the USA but coming into full force with President Reagan; Thatcher played similar role in GB) decided to liquidate the New Deal coalition and to cover up the upward redistribution of income with a smokescreen of neoliberal ideology. Which also served as anesthetic for lemmings which were mercilessly deprived of most safety net that they acquired due to New Deal ;-). As Lames Levy noted in his comment to Why the Claims Neoliberals Make About Markets Are Wrong naked capitalism

 Jefferson’s notion of “marketplace of ideas” doesn’t apply to the ideology of the market. Bad ideas, like bad people, often thrive. Many of us were taught that this was not the case–good triumphs over evil, virtue is its own reward, and the arc of history is long, but it bends towards justice. The older I get, the more I doubt these things, the less evidence I see for them, and the less self-correction I see in scholarship

The institutions of neoliberal capitalism, while promoting an expanded role in the economy for "market forces" (read "financial oligarchy")  simultaneously transform labor relations. The “market” under neoliberalism certainly no longer refers to competition as a form of the production and distribution goods and services. Instead, it means something more along the lines of international financial monopolies protected by collusion between captured vassal state institutions ( including neoliberal fifth column domination in the all major branches of government, especially executive and  legislative branches, educational institutions and media) and multinationals, which pay money to sustain this social order. The term “Free markets” under neoliberalism means letting rich people do what they want and neutralizing any government interference on this path, not promoting efficient allocation of resources through competition and the price mechanism. The core of the fifth column are local oligarchs and so called "Chicago boys" -- sons and daughters of local elite who are trained for and indoctrinated for this purpose in Western universities.

Under neoliberalism labor relations assumes the form of full domination of labor by capitalists under the disguise of "labor market' smokescreen which tries to atomize workers and deprive them of any solidarity actions. Unions ore officially suppressed and large part of middle class is brainwashed to hate using set of propaganda stories about unions corruption, welfare quinsy, lack of competitiveness in unionized industries (with Detroit as a prime story), etc.  In this sense crushing by Reagan of the strike of air controllers was one of the first manifestation of this dominance. Workers again are downgraded to the role of debt slaves, who should be glad to get subsistence wages. And, for example, wages in Wal-Mart are really on subsistence level, no question about it (Making Change at Walmart » Fact Sheet – Wages):

Walmart jobs are poverty-level jobs.

Walmart’s average sale Associate makes $8.81 per hour, according to IBISWorld, an independent market research group. This translates to annual pay of $15,576, based upon Walmart’s full-time status of 34 hours per week1. This is significantly below the 2010 Federal Poverty Level of $22,050 for a family of four. The Wall Street Journal reported that the average Walmart cashier makes just $8.48 an hour, far below the $11.22 national average for all cashiers.

This contrasts with the capital-labor compromise that characterized the state capitalism that existed several post-WWII decades and that was crushed by neoliberalism in 1970th. Neoliberalism also brought change in the relation between financial and non-financial capital: financial capital now again like in 1920th plays a dominant role dictating the rules of the game to manufacturing sector and controlling it via banks.

Role of deception under neoliberalism: elevating deception into a vital political tool

The key in understanding of neoliberalism is that nothing in neoliberal ideology can be taken in face value -- the cornerstone of neoliberal ideology is deception. More precisely, deception and propaganda (aka brainwashing) are two cornerstones of neoliberalism.  As such is has a lot of common with criminal societies and like them has a definite tendencies to self-destruction.  Here is one telling comment (Caelan MacIntyre, 12/05/2015 at 2:37 pm )

if we have a system that cheats, then anything is game.

Then I can cheat too. (And, along with others, I’ll likely be doing it on the ‘nitrous oxide’ of fury and resentment that some– maybe most– can feel when they wake up and realize that they’ve been cheated.)

So if sufficient numbers of (livid) people catch on, if they get out from under the cheating system’s ideological indoctrinations (that it’s not a cheat and that, say, coercive taxation, kid-killing cops and corporate parasites are all well and good and for our benefit), and find out that the game is really one big nasty rig/scam/dupe/hoodwink, what do you think will happen?

Let’s run the model/simulation and see.

Like new religion and much like the USSR in the past, neoliberalism cultivates a set of complex myths. Those myths via indoctrination  became the way of thinking of most people in neoliberal societies. That's an example of amazing power of brainwashing for preservation of particular social order; the trait the neoliberalism also shares with Marxism (implemented as Bolshevism in the USSR and other Eastern block countries).  But like was the case with the USSR, there is a danger of shocks that can kill those myths. If we agree with that hypothesis, then, simplifying, the longevity of neoliberal myths depends on the how long the role of the USA as the world hegemon will last and how long "cheap oil" regime will last.

For example the myth that neoliberalism produces poverty reduction and improve social wellbeing for all has become an alibi for the dismantling of the welfare state and along with it the dismantling of social rights of workers, on the one hand, and to the channeling of state coffers into private interests to the benefit of banks, financial institutions, and private business, on the other. This myth came under attack after 2008 crisis. Now most of the people see that neoliberal policies of wealth redistribution are shoveling most of the wealth gains into the pockets of a few rich plutocrats, As such they are incompatible with economic growth and reduction of poverty. Growing income inequality is a the main cause of excess saving and, hence, secular stagnation. But as a whole set of neoliberal myths proved to be pretty resilient; the same can be said about gradual process of eroding Marxist myths after 1945. It took almost 50 years (and rise of neoliberalism) to be be abandoned by most of the population of the USSR and Eastern Europe after which those societies became "house of cards" and were successfully toppled by bribing part of the elite by Reagan administration via color revolution mechanisms. But it was the USSR elite (and first of all the elite of KGB), that first changed sides and let it happen.

Every society has its set of myths that are directed on increase chances of the society survival. What is new is that neoliberal elite like feudal elites before it openly  despise even "lower 50%" of their own societies.  Neoliberal elite event went further. It advacates a pretty self0destuctive idea that that social safety nets created under New Deal should be completely dismantled. It looks to me like just a new form of elimination of undesirables: "While there will be political pressures to buffer folks from the consequences of economic folly or bad luck, it is socially dangerous to do so." This is reminiscent of Arbeit macht frei  slogan used in Nazi extermination camp. In other words this is equivalent to saying that we should go shoot all the monkeys because they are the wrong, inferior to humans branch of evolution (Neoliberalism is fascism ). Compare with:

"[Slavs, Latin, and Hebrew immigrants are] human weeds ... a deadweight of human waste ... [Blacks, soldiers, and Jews are a] menace to the race." "Eugenic sterilization is an urgent need ... We must prevent multiplication of this bad stock." -- Margaret Sanger, April 1933 Birth Control Review .

As such this is an elitist ideology (see The Iron Law of Oligarchy ), kind of Revolt of the Elite against common folk (aka  "shmucks", see  Randism,  an Americanized plagiarism of Nietzschean philosophy  created by a Russian emigrant).

While completely based on deception and leading to impoverishment of lower 80% of population and shrinking of middle class, neoliberalism (as of  2015)  still remains a powerful, dominant global ideology. Or more correctly  a new secular religion (there is nothing scientific in neoliberal doctrine and very little in  neoclassical economics, which like in case of Marxism serves as the cornerstone of his ideology). Since early 80th it became the  dominant ideology in the world, which defeated and displaced both communism and social-democracy models.

It is important to stress that it is probably the first worldwide ideology based on deception in a sense that it pretends to provide benefits to all nations while in reality for all nations outside "first class nations" (G7 and a few others industrialized nations)  it enforces neocolonial model of economic relations. It also operates with pseudoscientific concepts like "free market" that have tremendous propaganda value, serving as an opening door for neoliberalism into minds on many people.  To disperse  the smoke of this propaganda proved to be not that easy tasks, as it became self-sustainable providing wealth to Wall Street which trickle down small part of it to corrupt MSM.  "Free market" propaganda even managed to survive the crash of neoliberal doctrine in 2008.

The essence of  neoliberalism is redistribution of wealth up is also carefully hidden under the smoke screen. Neoliberalism in principle can't deliver prosperity for all, as the key idea is just the opposite. But revolt is suppressed by powerful propaganda machine as well as the raw military and technological power of the USA ("Lord protector" of neoliberalism) and speculation on human greed (which represents a variation of classic "divide and conquer" approach).  It is difficult to define neoliberalism precisely but the restoration of unlimited power of financial oligarchy under smoke screen of "return to prosperity via accelerated development" is definitely its one of key features. And the level of unlimited unchecked power now is very similar it enjoyed at the beginning of XX century and which was destroyed by the Great Depression.

Another interesting deception used by neoliberalism is absolutizing the value of competition in social systems. This is  used as a smoke screen via an abstract, ideologically charged construct called "free market" (free for whom? why not "fair market" ?) . Simplifying you can see it as a power grab by globalized economic (and first of all financial) elite and a race to the bottom for the rest of world population. In this sense neoliberalism is not only about the redistribution of wealth up, toward the top 0.1%.  It is also about putting the elite outside the framework of the law and  institualizing fraud and deception as a business model for elite (and only for elite). Much like in feudalism neoliberal lords stand above the law.  This ability of the elite to commit criminal acts with impunity is the key component of neoliberalism as a political system (which 2008 events aptly demonstrated to the world)

Neoliberal revolution as an internal color revolution in the USA

Color revolutions is a new method of warfare modeled after Trotsky idea of Permanent revolution. The most interesting part is that is can be used within the society as it uses existing democratic mechanisms to bring to power desired set of political actors. The key idea is undermining the society from within, by introducing a Trojan horse into it. Among mechanisms used are:

  1. Establishing a strong network of think tanks. Buying part of "intelligencia" .  Along with think tanks another target was economic departments of universities. Bribing economics proved to be extremely successful and relatively cheap (in comparison with the cost of political lobbing) operation.  See  Neoclassical Pseudo Theories and Crooked and Bought Economists as Fifth Column of Financial Oligarchy. Buying influential members within the country intellectual community was an important part of this scheme.  Milton Friedman was one of the most successful acquisitions. After spending life of relatively modest means he really enjoyed his new affluent status at the end of this life. That is what Powell memo is about.  See The Powell Memo A Call-to-Arms for Corporations BillMoyers.com
  2. Reusing set of Bolsheviks/Trotskyite ideas and political practices which were introduced to Republican Party by "turncoats" from US Trotskyite movement -- American neoconservatives, who were mostly Jewish intellectuals. Among those who changes sides were Irving Kristol  who is considered to be the father of Neoconservatism and before him James Burnham (see American Machiavelli) who did much of the transfer of political methods and approaches from Trotskyism to Republican Party  
  3. A new version of Internationalism -- "Corporate Internationalism": "Businessmen of the World, Unite!"

     The number of corporations with public affairs offices in Washington grew from 100 in 1968 to over 500 in 1978. In 1971, only 175 firms had registered lobbyists in Washington, but by 1982, nearly 2,500 did. The number of corporate PACs increased from under 300 in 1976 to over 1,200 by the middle of 1980.[5] On every dimension of corporate political activity, the numbers reveal a dramatic, rapid mobilization of business resources in the mid-1970s.

    What the numbers alone cannot show is something of potentially even greater significance: Employers learned how to work together to achieve shared political goals. As members of coalitions, firms could mobilize more proactively and on a much broader front. Corporate leaders became advocates not just for the narrow interests of their firms but also for the shared interests of business as a whole. ( The Powell Memo A Call-to-Arms for Corporations BillMoyers.com)

  4. The ethnic and religious fragmentation. The starting point of any color revolution is identification of the usable social tensions and their systematic aggravation so that that at the end they can serve as a detonator of the planned crisis. This means mutual divide constitutive of the community, with an emphasis on what sets them apart, and at the same time reducing the weight of what they have in common.  For example neoliberalism stresses creativity (in a very narrow sense of ability to amass money)  and despise poor. Wedge issues such a gay marriage were also successfully used for this purpose especially in view of alliance of neoconservatives and fundamentalist Christian sects. 
  5. Deceptive promise of higher standard of living and creation of various material temptations to support the politically desired behavior. The majority of the population responded positively to these fake prospects of improving their standard of living (at the expense of other , "inferior" members of society -- as in Latin proverb  Homo homini lupus est) and totally failed to realize gravity of the real costs of economic and social transition to neoliberalism for lower 80% of population.  And the extent of redistribution of wealth up under neoliberalism.
  6. Control of MSM for the purpose of influencing/alterting the perception and behavior of the masses. MSM promoted the almost uniform and factually incorrect narrative about the benefits that would come from a  neoliberal transformation of the society.  They also act of a powerful spoiler of any attempt to fight neoliberal transformation of the society.  The level of altering the perception of certain issues in the USA is nothing short from brainwashing. See Neoliberal Brainwashing -- Journalism in the Service of the Powerful Few and In Foreign Events Coverage Guardian Presstitutes Slip Beyond the Reach of Embarrassment
  7. Politically marginalizing part of the population, which is resistant to neoliberal brainwashing and continues to hold its own narrative. That includes decimation of trade unions started by Reagan administration.

The typical for corporatism union of corporate power and government was in case of the USA transformed into a unique mix of corporatism and totalitarism which Sheldon Wolin called "inverted totalitarianism". Which is just another nickname for neoliberalism.  Unlike traditional corporatism of  Nazi Germany, and Italy the American neoliberal system is designed not to mobilize the populace, but to distract it, to encourage a sense of dependency. to achieve this goal a set of policies are instituted which include, but not limited to atomizing the society by cutting solidarity ties,  cultivating fear, calling everything a "war" (claiming that the country is in some permanent, unwinnable war like  "war on terror"  -- the trick borrowed directly from Orwell 1984) as well as encouraging political disengagement (as in Reagan quote: "The nine most terrifying words in the English language are "I'm from the government, and I'm here to help."  or Bush "Go shopping" recommendation after 9/11 .

Those dirty tricks allowed corporate elite to take full political power and kill remnants of trade unions political  power while citizenry showed little interest or concern. In other words it was the powerful corporate interests which were the key promoters of neoliberalism and the key beneficiaries of its spread. They ingeniously used the Cold War as a pretext of dismantling of the New Deal  ( Pt 1-8 Hedges & Wolin Can Capitalism and Democracy Coexist - YouTube):

HEDGES: And the Cold War. So the Cold War arises. And this becomes the kind of moment by which capital, and especially corporate capital, can dismantle the New Deal and free itself from any kind of regulation and constraint to deform and destroy American democracy. Can you talk about that process, what happened during that period?

WOLIN: Well, I think the first thing to be said about it is the success with which the governing groups manage to create a Cold War that was really so total in its spread that it was hard to mount a critical opposition or to take a more detached view of our relationship to the Soviet Union and just what kind of problem it created.

And it also had the effect, of course, of skewing the way we looked at domestic discontents, domestic inequalities, and so on, because it was always easy to tar them with the brush of communism, so that the communism was just more than a regime. It was also a kind of total depiction of what was the threat to -- and complete opposite to our own form of society, our old form of economy and government.

HEDGES: And in Politics and Vision, you talk about because of that ideological clash, therefore any restriction of capitalism which was defined in opposition to communism as a kind of democratic good, if you want to use that word, was lifted in the name of the battle against communism, that it became capitalism that was juxtaposed to communism rather than democracy, and therefore this empowered capital, in a very pernicious way, to dismantle democratic institutions in the name of the war on communism.

WOLIN: Oh, I think there's no question about that, the notion that you first had to, so to speak, unleash the great potential capitalism had for improving everybody's economical lot and the kind of constraints that had been developed not only by the New Deal, but by progressive movements throughout the 19th century and early 20th century in the United States, where it had been increasingly understood that while American economic institutions were a good thing, so to speak, and needed to be nurtured and developed, they also posed a threat.

They posed a threat because they tended to result in concentrations of power, concentrations of economic power that quickly translated themselves into political influence because of the inevitably porous nature of democratic representation and elections and rule, so that the difficulty's been there for a long time, been recognized for a long time, but we go through these periods of sleepwalking where we have to relearn lessons that have been known almost since the birth of the republic, or at least since the birth of Jeffersonian democracy, that capitalism has its virtues, but it has to be carefully, carefully watched, observed, and often controlled.

Later Wendy Brown, professor in Berkley advanced Professor Wolin ideas to a new level  in her book Undoing the Demos: Neoliberalism's Stealth Revolution (Zone Books, 2015). Essentially she viewed neoliberalism as an internal color revolution, kind of coup d'état by part of the elite against New Deal.  Notable quotes from her interview (What Exactly Is Neoliberalism):

"... I treat neoliberalism as a governing rationality through which everything is "economized" and in a very specific way: human beings become market actors and nothing but, every field of activity is seen as a market, and every entity (whether public or private, whether person, business, or state) is governed as a firm. Importantly, this is not simply a matter of extending commodification and monetization everywhere-that's the old Marxist depiction of capital's transformation of everyday life. Neoliberalism construes even non-wealth generating spheres-such as learning, dating, or exercising-in market terms, submits them to market metrics, and governs them with market techniques and practices. Above all, it casts people as human capital who must constantly tend to their own present and future value. ..."

"... The most common criticisms of neoliberalism, regarded solely as economic policy rather than as the broader phenomenon of a governing rationality, are that it generates and legitimates extreme inequalities of wealth and life conditions; that it leads to increasingly precarious and disposable populations; that it produces an unprecedented intimacy between capital (especially finance capital) and states, and thus permits domination of political life by capital; that it generates crass and even unethical commercialization of things rightly protected from markets, for example, babies, human organs, or endangered species or wilderness; that it privatizes public goods and thus eliminates shared and egalitarian access to them; and that it subjects states, societies, and individuals to the volatility and havoc of unregulated financial markets. ..."

"... with the neoliberal revolution that homo politicus is finally vanquished as a fundamental feature of being human and of democracy. Democracy requires that citizens be modestly oriented toward self-rule, not simply value enhancement, and that we understand our freedom as resting in such self-rule, not simply in market conduct. When this dimension of being human is extinguished, it takes with it the necessary energies, practices, and culture of democracy, as well as its very intelligibility. ..."

"... For most Marxists, neoliberalism emerges in the 1970s in response to capitalism's falling rate of profit; the shift of global economic gravity to OPEC, Asia, and other sites outside the West; and the dilution of class power generated by unions, redistributive welfare states, large and lazy corporations, and the expectations generated by educated democracies. From this perspective, neoliberalism is simply capitalism on steroids: a state and IMF-backed consolidation of class power aimed at releasing capital from regulatory and national constraints, and defanging all forms of popular solidarities, especially labor. ..."

"... The grains of truth in this analysis don't get at the fundamental transformation of social, cultural, and individual life brought about by neoliberal reason. They don't get at the ways that public institutions and services have not merely been outsourced but thoroughly recast as private goods for individual investment or consumption. And they don't get at the wholesale remaking of workplaces, schools, social life, and individuals. For that story, one has to track the dissemination of neoliberal economization through neoliberalism as a governing form of reason, not just a power grab by capital. There are many vehicles of this dissemination -- law, culture, and above all, the novel political-administrative form we have come to call governance. It is through governance practices that business models and metrics come to irrigate every crevice of society, circulating from investment banks to schools, from corporations to universities, from public agencies to the individual. It is through the replacement of democratic terms of law, participation, and justice with idioms of benchmarks, objectives, and buy-ins that governance dismantles democratic life while appearing only to instill it with "best practices." ..."

"... Progressives generally disparage Citizens United for having flooded the American electoral process with corporate money on the basis of tortured First Amendment reasoning that treats corporations as persons. However, a careful reading of the majority decision also reveals precisely the thoroughgoing economization of the terms and practices of democracy we have been talking about. In the majority opinion, electoral campaigns are cast as "political marketplaces," just as ideas are cast as freely circulating in a market where the only potential interference arises from restrictions on producers and consumers of ideas-who may speak and who may listen or judge. Thus, Justice Kennedy's insistence on the fundamental neoliberal principle that these marketplaces should be unregulated paves the way for overturning a century of campaign finance law aimed at modestly restricting the power of money in politics. Moreover, in the decision, political speech itself is rendered as a kind of capital right, functioning largely to advance the position of its bearer, whether that bearer is human capital, corporate capital, or finance capital. This understanding of political speech replaces the idea of democratic political speech as a vital (if potentially monopolizable and corruptible) medium for public deliberation and persuasion. ..."

"... My point was that democracy is really reduced to a whisper in the Euro-Atlantic nations today. Even Alan Greenspan says that elections don't much matter much because, "thanks to globalization . . . the world is governed by market forces," not elected representatives. ..."

As I mentioned above an interesting tactical step of the wizards behind the screen of the neoliberal revolution was creating and nurturing the powerful and influential intellectual "fifth column" inside the country. In case of the USA it was done mainly by lavish financial of "appropriate" think tanks as well as bribing the economic departments of the universities (this was the point when salaries of professors of economic shoot up while salaries of professors in other department stagnated).  
 

Extremism of Neoliberalism, Neoconservatives as militant faction of neoliberals


If the outcome is so different from our aims -- if, instead of freedom and prosperity, bondage and misery stares us in the face -- is it not clear that sinister forces must have foiled our intentions, that we are the victims of some evil power which must be conquered before we can resume the road to better things?

Friedrich Hayek, The Road to Serfdom

Neoliberalism is more than a set of  economic policies based on absolutization of the value of the market and attempt to view everything in market categories.  As a form of reason developed into a governing rationality, it converts every aspect of contemporary existence into a market framework.  All human conduct for neoliberalism is a economic behavior, a market conduct. In other words under neoliberal ideology market is the ultimate for of human relations and should encompass all spheres of existence. 

Like was previously the case of Communism/Bolshevism/Trotskyism  a distinguishing feature of neoliberal ideology is establishment of a new "neoliberal rationality" and religious believe in its inevitability with the clincher argument pioneered by Margaret Thatcher: there is no alternative”(TINA).  That makes neoliberal a pretty radical ideology which serves the base of radicalized movement. In some respects this movement can compete not only with the Communist Party of the soviet Union (CPSU) but also with Taliban.

As Lars Cornelissen noted "In this sense Friedrich Hayek’s The Road to Serfdom is today, above all else, a testimony to irony. The book is punctuated with frightening images of lives reduced to unfreedom, people seen the Greek god of satire and irony, himself ordained it, The Road to Serfdom has turned to be the first cobblestone in the rod to neoliberal serfdom. Everything Hayek expected socialism would bring has seemingly come true under a regime he himself helped lay the theoretical foundations for -- a fact all the more ironic because Keynesianism,  for all its flaws, never led to the totalitarian regime Hayek claimed it would."  (criticalstudies.org.uk)

Instead of Communist manifesto neoliberals use so called Washington Consensus and instead of Capital Milton's Friedman book Capitalism as Freedom. They also re-define the meaning of the word "freedom"  (Deconstructing neoliberalism's definition of 'freedom').  Instead Roosevelt classic four freedoms, they put as the cornerstone the corner cult of possessions (see also Ayn Rand and her Objectivism Cult). That makes neoliberalism as powerful extremist ideology as communism, or radical Islam, if you wish ;-). Because of its ideological extremism: it recognizes no competitors, and allows its adherents ignore the possibility of viable alternatives.  The extremist, jingoistic wing of neoliberals in the USA is represented by so called neoconservatives (Paul Wolfowitz, Bush Jr.’s Deputy Secretary of Defense even managed to became the President of the World Bank, confirming the idea that finance is a war by other means) . Since Clinton the position of Secretary of State is occupied by warmongering female neocons, with Hillary Clinton as the most recent example

Neoliberalism and Christianity

For thousand years various religions attempted to suppress the excessive greed in men, as this is a prerequisite for stability and  functioning of society. In this respect neoliberalism is really Devil Creed as it consider greed to be a virtue ("greed is good"). In other words from the point of view of Christian theology neoliberalism is nothing but a flavor of Satanism (Wikipedia):

Its core beliefs revolves around individualism, egotism, Epicureanism, self-deification and self-preservation, and  propagate a worldview of natural law, materialism, Social Darwinism, Lex Talionis ("eye for an eye"), and mankind as animals"

... ... ...

It is atheistic philosophy which asserts that "each individual is his or her own god and there isno room for any other God. "

Neoliberalism explicitly rejects the key ideas of Christianity -- the idea of ultimate justice for all sinners. The idea that a human being should struggle to create justice in this world while realizing that the ultimate solution is beyond his grasp.

As Reinhold Niebuhr noted a world where there is one center of power and authority (financial oligarchy under neoliberalism) "preponderant and unchallenged... its world rule almost certainly violate basic standard of justice". The same is true about globalization as

"no world government could possibly possess for generations to come, the moral and political authority to redistribute power between nations to the degree in which highly cohesive national communities have accomplished this end in recent centuries". 

He warned that

"Lacking a deep understanding of the complexities of national aspirations and cultural differences, US foreign policy often lingers between two extremes of offering economic advantage to secure cooperation or overcoming intransigence through military force".

The problem with "greed is good" slogan it cultivates cruelty toward other people, As Pope Francis noted "To sustain a lifestyle which excludes others ... a globalization of indifference has developed. Almost without being aware of it, we end up being incapable of feeling compassion ..."

Here are selected quotes from Evangelii Gaudium, Apostolic Exhortation of Pope Francis, 2013 (see also Pope Francis on danger of neoliberalism)

... Such an [neoliberal] economy kills. How can it be that it is not a news item when an elderly homeless person dies of exposure, but it is news when the stock market loses two points? This is a case of exclusion. Can we continue to stand by when food is thrown away while people are starving? This is a case of inequality. Today everything comes under the laws of competition and the survival of the fittest, where the powerful feed upon the powerless. As a consequence, masses of people find themselves excluded and marginalized: without work, without possibilities, without any means of escape.

Human beings are themselves considered consumer goods to be used and then discarded. We have created a “disposable” culture which is now spreading. It is no longer simply about exploitation and oppression, but something new. Exclusion ultimately has to do with what it means to be a part of the society in which we live; those excluded are no longer society’s underside or its fringes or its disenfranchised – they are no longer even a part of it. The excluded are not the “exploited” but the outcast, the “leftovers”.

54. In this context, some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by the facts, expresses a crude and naïve trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system. Meanwhile, the excluded are still waiting. To sustain a lifestyle which excludes others, or to sustain enthusiasm for that selfish ideal, a globalization of indifference has developed.

Almost without being aware of it, we end up being incapable of feeling compassion at the outcry of the poor, weeping for other people’s pain, and feeling a need to help them, as though all this were someone else’s responsibility and not our own. The culture of prosperity deadens us; we are thrilled if the market offers us something new to purchase; and in the meantime all those lives stunted for lack of opportunity seem a mere spectacle; they fail to move us.

No to the new idolatry of money

55. One cause of this situation is found in our relationship with money, since we calmly accept its dominion over ourselves and our societies. The current financial crisis can make us overlook the fact that it originated in a profound human crisis: the denial of the primacy of the human person! We have created new idols. The worship of the ancient golden calf (cf. Ex 32:1-35) has returned in a new and ruthless guise in the idolatry of money and the dictatorship of an impersonal economy lacking a truly human purpose. The worldwide crisis affecting finance and the economy lays bare their imbalances and, above all, their lack of real concern for human beings; man is reduced to one of his needs alone: consumption.

56. While the earnings of a minority are growing exponentially, so too is the gap separating the majority from the prosperity enjoyed by those happy few. This imbalance is the result of ideologies which defend the absolute autonomy of the marketplace and financial speculation. Consequently, they reject the right of states, charged with vigilance for the common good, to exercise any form of control. A new tyranny is thus born, invisible and often virtual, which unilaterally and relentlessly imposes its own laws and rules. Debt and the accumulation of interest also make it difficult for countries to realize the potential of their own economies and keep citizens from enjoying their real purchasing power. To all this we can add widespread corruption and self-serving tax evasion, which have taken on worldwide dimensions. The thirst for power and possessions knows no limits. In this system, which tends to devour everything which stands in the way of increased profits, whatever is fragile, like the environment, is defenseless before the interests of a deified market, which become the only rule.

No to a financial system which rules rather than serves

57. Behind this attitude lurks a rejection of ethics and a rejection of God. Ethics has come to be viewed with a certain scornful derision. It is seen as counterproductive, too human, because it makes money and power relative. It is felt to be a threat, since it condemns the manipulation and debasement of the person. In effect, ethics leads to a God who calls for a committed response which is outside of the categories of the marketplace. When these latter are absolutized, God can only be seen as uncontrollable, unmanageable, even dangerous, since he calls human beings to their full realization and to freedom from all forms of enslavement. Ethics – a non-ideological ethics – would make it possible to bring about balance and a more humane social order. With this in mind, I encourage financial experts and political leaders to ponder the words of one of the sages of antiquity: “Not to share one’s wealth with the poor is to steal from them and to take away their livelihood. It is not our own goods which we hold, but theirs”.[55]

58. A financial reform open to such ethical considerations would require a vigorous change of approach on the part of political leaders. I urge them to face this challenge with determination and an eye to the future, while not ignoring, of course, the specifics of each case. Money must serve, not rule! The Pope loves everyone, rich and poor alike, but he is obliged in the name of Christ to remind all that the rich must help, respect and promote the poor. I exhort you to generous solidarity and a return of economics and finance to an ethical approach which favours human beings.

No to the inequality which spawns violence

59. Today in many places we hear a call for greater security. But until exclusion and inequality in society and between peoples is reversed, it will be impossible to eliminate violence. The poor and the poorer peoples are accused of violence, yet without equal opportunities the different forms of aggression and conflict will find a fertile terrain for growth and eventually explode. When a society – whether local, national or global – is willing to leave a part of itself on the fringes, no political programmes or resources spent on law enforcement or surveillance systems can indefinitely guarantee tranquility. This is not the case simply because inequality provokes a violent reaction from those excluded from the system, but because the socioeconomic system is unjust at its root. Just as goodness tends to spread, the toleration of evil, which is injustice, tends to expand its baneful influence and quietly to undermine any political and social system, no matter how solid it may appear. If every action has its consequences, an evil embedded in the structures of a society has a constant potential for disintegration and death. It is evil crystallized in unjust social structures, which cannot be the basis of hope for a better future. We are far from the so-called “end of history”, since the conditions for a sustainable and peaceful development have not yet been adequately articulated and realized.

60. Today’s economic mechanisms promote inordinate consumption, yet it is evident that unbridled consumerism combined with inequality proves doubly damaging to the social fabric. Inequality eventually engenders a violence which recourse to arms cannot and never will be able to resolve. This serves only to offer false hopes to those clamouring for heightened security, even though nowadays we know that weapons and violence, rather than providing solutions, create new and more serious conflicts. Some simply content themselves with blaming the poor and the poorer countries themselves for their troubles; indulging in unwarranted generalizations, they claim that the solution is an “education” that would tranquilize them, making them tame and harmless. All this becomes even more exasperating for the marginalized in the light of the widespread and deeply rooted corruption found in many countries – in their governments, businesses and institutions – whatever the political ideology of their leaders.

Ideology of Financial Elite: how neoliberal lie became hegemonic despite being a lie

"Poverty wants much; but greed wants everything."

Publilius Syrus

Historically neoliberalism emerged as an ideology of the financial elite, specifically as the ideology of financial revanchism.  It was custom made to serve their need and in its origin there is a certain analogy with Marxism, with Mont Pelerin Society serving as a "party" that created and advanced this ideology ( Everything You Need to Know about Laissez-Faire Economics):

DSW: Please give me a thumbnail history of the Mont Pelerin Society and the role it played in advancing economic theory and policy. So this would be Hayek, Friedman and all that.

AK: The great hero of that society was Hayek. He had a different position from Walras & company and he wasn't very consistent in his views. According to Hayek, Walras said that nobody influences prices but take prices as given, and then somebody, not specified, adjusts them until they get to equilibrium. There is some mechanism out there. That was Walras. Hayek said "Not at all!" He said -- actually he was a horrid man.

DSW: Wait a minute! Why was he a horrid man? You can't just glide over that!

AK: The reason I say that is-he had very clever ideas -- but he was extremely bigoted, he was racist. There is a wonderful interview with him that you can find on You Tube, where he says (imitating Hayek's accent) "I am not a racist! People accuse me of being a racist. Now it's true that some of the Indian students at the London School of Economics behave in a very nasty way, typical of Indian people…" and he carries on like this. So that's one reason he is horrid. A second thing is that if you don't believe he is horrid, David, I will send you his book The Road to Serfdom, which said that if there is any planning going on in the economy, it will inevitably lead you to a fascist situation. When he produced that book it had a big success, particularly in the United States, and what is more, he authorized a comic book version of it, which is absolutely dreadful. One Nobel Prize winner, [Ronald] Coase, said "you are carrying on so much against central planning, you forget that a large part of our economy is actually governed by centrally planned institutions, i.e., big firms, and these big firms are doing exactly what you say they can't do. Hayek shrugged that off, but what he did in his book was say that if any planning goes on then eventually you are all going to wind up in a fascist state where you'll be shot if you don't do what you're told to do. At the end of the book there is some poor guy who's being shot because he wants to be a carpenter or a plumber, or something like that. It's terrible! And the irony of the whole situation is that comic book was issued and financed by General Motors, and GM of course is one of those corporations that Hayek didn't see were centrally planned institutions. That's way I say that Hayek was a dreadful person.

Hayek's idea was, there is no way that people could know what was going on and could know what the prices of goods are. Everyone has a little piece of information of their own, and in acting upon it, this news gets out into the market. So, for example I buy something such as a share, and you say "Oh, Kirman bought a share, so something must be going on there, based on information that he had that I didn't have", and so forth. Hayek's idea was that this mechanism-people watching each other and getting information from their acts, would lead you to the equilibrium that would be a socially optimal state. But again, he never specified closely what the mechanism was. He has little examples, such as one about shortage of tin and how people would adjust, but never really specified the mechanism. He believed that people with little information of their own, like ants, would somehow collectively get it right. It was a very different view of the world than Walras.

DSW: So he was a pioneer in two respects. First of all, he grasped the idea of self-organizing and decentralized processes-that the intelligence is in the system, not in any individual, and secondly cultural group selection, that the reason economic systems were like this is because of some past history of better systems replacing worse systems. The wisdom of the system was the product of cultural group selection, as we would put it today, and that we shouldn't question its wisdom by tampering with it. Is that a fair thing to say?

AK: Yes, that's a fair thing to say and I think it is what Hayek believed. He didn't actually show how it would happen but you're absolutely right -- I think that's what he believed and he thought tampering with this system would make it less perfect and work less well, so just leave it alone. I don't think he had in mind, strictly speaking, group-level selection, but that's clearly his idea. A system that works well will eventually come to outstrip other systems. That's why he was advising Thatcher. Just trust the markets and let things go. Get rid of the unions, and so forth. So it's clearly he had in mind that interfering with that system would just lead you to a worse social situation. He was much less naïve than Friedman. Friedman has a primitive natural selection argument that if firms aren't doing better than other firms they'll go bust and just die. That's a summary of Friedman's evolutionary argument! But Hayek is much more sophisticated-you're absolutely right.

DSW: I think Hayek was explicit about cultural group selection, and Friedman -- I've paid quite a bit of attention to his 1953 article on positive economics, in which he makes a very naïve evolutionary argument. Friedman and Hayek didn't see eye to eye at all, as I understand it. Hayek was actually very concerned that Friedman and other mathematical economists took over the Mont Pelerin Society, if I understand it correctly, but now let's put Friedman on center stage, and also the society as a whole and the creation of all the think tanks, which caused the society to become politically influential.

AK: Yes, I think that it coincided very nicely with conservative ideology and people who had really strongly liberal -- not in the Mills sense (you have to make this distinction particularly in the United States where these words have different meanings), but really completely free market "leave-everybody-to-their-own-thing"  libertarian point of view. Those people found it a wonderful place to gather and reinforce themselves. And Hayek was a strong member of that. Another was Gary Becker, but I don't know how directly. Becker had the economics of everything-divorce, whatever. You'd have these simple arguments, but not necessarily selection arguments, often some sort of justification in terms of a superior arrangement. The marginal utility of the woman getting divorced just has to equal the marginal utility of not getting divorced and that would be the price of getting divorced, and that sort of stuff. Adam Smith would have rolled over in this grave because he believed emotions played a strong role in all of this and the emotions that you have during divorce don't tie into these strict calculations.

DSW: This is a tailor-made ideology for powerful interests, powerful people and corporations who simply do want to have their way. Is that a false statement to make?

AK: No, I think that's absolutely right. They can benefit from using that argument to advance their own ends. As someone once said, if you think of saying to firms, we're going to diminish their taxes, no firm in its right mind would argue with that. Even though they might think deep down that there are other things that could be done for society. There are some things which are part of this philosophy which is perfect for firms and powerful interest groups. You're absolutely right. And so they lobby for this all the time, pushing for these positions that are in fact in their own interest.

DSW: So, at the end of the day, "Greed is Good" sounds so simplistic, but what all of this seems to do is to provide some moral justification for individuals or corporations to pursue their own interests with a clear conscience. It's a moral justification for "Greed is Good", despite all of the complexities and all of the mathematics -- that's what it seems to come down to. Am I wrong about that?

AK: I think you're absolutely right. What's interesting is that if you look at various economic situations, like today the first thing that people tell you about the Greeks is that they are horrid ideological people. But the people on the other side have an equally strong ideology, which is being justified by the sort of economic models that we are building. Remember that even though we had this discussion about how this became a real difficulty in theoretical economics, in macroeconomics they simply carried on as if these theoretical difficulties hadn't happened. Macroeconomic models are still all about equilibria, don't worry about how we got them, and their nice efficient properties, and so forth. They are nothing to do with distribution and nothing to do with disequilibrium. Two big strands of thought-Keynes and all the people who work on disequilibrium-they're just out of it. We're still working as if underlying all of this, greed -- we don't want to call it greed, but something like greed -- is good.

DSW: Could I ask about Ayn Rand and what role she played, if any? On the one hand she was not an economist, she was just a philosopher and novelist. On the other hand, she is right up there in the pantheon of free market deities alone with Smith, Hayek and Friedman. Do you ever think about Ayn Rand. Does any economist think about Ayn Rand?

AK: That's an example of my narrowness that I never read Ayn Rand, I just read about her. I think it would be unfair now to make any comments about that because I'd be as uninformed as some people who talk about Adam Smith. What I should do at some point is read some of her work, because she is constantly being cited on both sides as a dark bad figure or as a heroine in the pantheon as you said, with Hayek and everybody else. I just admit my ignorance and I don't know if Rand had a serious position on her own or whether she is being cited as a more popular and easily accessible figure.

DSW: Fine! I'd like to wrap this up with two questions. This has been a wonderful conversation, by the way. Nowadays, you hear all the time about how neoliberal ideology and thought is invading European countries and is undoing forms of governance that are actually working quite well. I work a lot in Norway and Scandinavia and there you hear all the time that Nordic model works and at the same time it is being corrupted by the neoliberal ideology, which is being spread in some sort of cancerous fashion. Please comment on that-Current neoliberalism. What justifies it? Is it spreading? Is that a good thing or a bad thing? Anything you would like to say on that topic.

AK: I think that one obsession that economists have is with efficiency. We're always, always, worrying about efficiency. People like to say that this is efficient or not efficient. The argument is, we know that if you free up markets you get a more efficient allocation of resources. That obsession with efficiency has led us to say that we must remove some of these restraints and restrictions and this sort of social aid that is built into the Scandinavian model. I think that's without thinking carefully about the consequences. Let me tell you my favorite and probably not very funny story about how economists are obsessed with efficiency. There were three people playing golf; a priest, a psychoanalyst, and an economist. The got very upset because the guy in front was playing extremely slowly and he had a caddy to help him. So these guys get very upset and they start to shout and say "Come on, can we play through please! You can't waste all of our afternoon!" They sent the priest up to find out what was going on and he came back absolutely crestfallen and said "You know why that poor guy is laying so slowly? It's because he's blind. I'm so upset because every Sunday I'm preaching to people to be nice to others." He turns to his psychoanalyst friend and say's "Joe, what do you think?" Joe says "I have these guys on my coach every week. I'm trying to help them live with this problem and here I am screaming at this guy. It's horrible!" Then they turn to the economist and say "Fred, what do you think?" Fred says "I think that this situation is totally inefficient. This guy should play at night!" As you can see, this is a very different attitude to how the world works.

I think what has happened is, because of this mythology about totally free markets being efficient, we push for that all the time and in so doing, we started to do things like-for example, we hear all the time that we have to reform labor markets in Europe. Why do we want to reform them? Because then they'll be more competitive. You can reduce unit labor costs, which usually means reducing wages. But that has all sorts of consequences, which are not perceived. In model that is more complex, that sort of arrangement wouldn't necessarily be one that in your terms would be selected for. When you do that, you make many people temporary workers. You have complete ease in hiring and firing so that people are shifting jobs all the time. When they do that, we know that employers then invest nothing in their human capital. When you have a guy who may disappear tomorrow-and we have a lot of these temporary agencies now in Europe–which send you people when you need them and take away people when you don't. Employers don't spend anything on human capital. We're reducing the overall human capital in society by having an arrangement like that. If you're working for Toyota, Toyota knows pretty much that you'll be working all your lifetime, so they probably invest quite a lot in you. They make you work hard for that, but nevertheless it is a much more stable arrangement. Again, the idea that people who are out of work have chosen to be out of work and by giving them a social cushion you induce them to be out of work-that simply doesn't fit with the facts. I think that all the ramification of these measures-the side effects and external effects-all of that gets left out and we have this very simple framework that says "to be competitive, you just have to free everything up." That's what undermining the European system. European and Scandinavian systems work pretty well. Unemployment is not that high in the Scandinavian system. It may be a little bit less efficient but it may also be a society where people are a little bit more at ease with themselves, than they are in a society where they are constantly worrying about what will happen to them next. The last remark I would make is that to say "you've got to get rid of all those rules and regulations you have"-in general, those rules and regulations are there for a reason. Again, to use an evolutionary argument, they didn't just appear, they got selected for. We put them in place because there was some problem, so just to remove them without thinking about why they are there doesn't make a lot of sense.

DSW: Right, but at the same time, a regulation is a like a mutation: for every one that's beneficial there are a hundred that are deleterious. So…

AK: You are an American, deep at heart! You believe that all these regulations are dreadful. Think of regulations about not allowing people to work too near a chain saw that's going full blast, or not being allowed to work with asbestos and so forth. Those rules, I think, have a reason to be there.

DSW: Well of course, but just to make my position clear, the idea of no regulations is absurd. For a system that is basically well adapted to its environment, then most of its regulations are there for a reason, as you say, but one of the things that everyone needs to know about evolution is that a lot of junk accumulates. There is junk DNA and there is junk regulations. Not every regulation has a purpose just because it's there, and when it comes to adapting to the future, that's a matter of new regulations and picking the right one out of many that are wrong. The question would be, how do you create smart regulations? Knowing that you need regulations, how do you create smart ones? That's our challenge and the challenge of someone who appreciates complexity, as you do. How would you respond to that?

AK: I think you're absolutely right. It's absolutely clear that as these regulations accumulate, they weren't developed in harmony with each other, so you often get even contradictory regulations. Every now and then, simplifying them is hugely beneficial. But that doesn't mean getting rid of regulations in general. It means somehow managing to choose between them, and that's not necessarily a natural process. For example, in France when I arrived here it used to take about a day and a half to make my tax return. Now it takes around about 20 minutes, because some sensible guy realized that you could simplify this whole thing and you could put a lot of stuff already into the form which they have received. They have a lot of information from your employer and so forth. They've simplified it to a point where it takes me about 20 minutes a year to do my tax return. It used to take a huge amount of time.

DSW: Nice!

AK: What's interesting is that you have some intelligent person saying "let's look at this and see if we can't make these rules much simpler, and they did. I have conflicting views, like you. These things are usually there for a reason, so you shouldn't just throw them away, but how do you select between them. I don't think that they necessarily select themselves out.

DSW: I would amend what you said. You said that some intelligent person figured out how to make the tax system work better in France. Probably not just a single intelligent person. Probably it was an intelligent process, which included intelligent people, but I think that gets us back to the idea that we need systemic processes to evaluate and select so that we become adaptable systems. But that will be systemic thing, not a smart individual.

AK: You're absolutely right. I shouldn't have said smart individual because what surely happened was that there was a lot of pressure on the people who handle all of these things, and gradually together they realized that this situation was becoming one where their work was becoming almost impossible to achieve in the time available. So there was some collective pressure that led them to form committees and things that thought about this and got it together. So it was a natural process of a system, but it wasn't the rules themselves that selected themselves out, as it were. It was the collectivity that evolved in that way to make it simpler.

DSW: There's no invisible hand to save the day.

AK: (laughs). Joe Stiglitz used to say that we also need a visible hand. The visible hand is sometimes pretty useful. For example in the financial sector I think you really need a visible hand and not an invisible hand.

As David Harvey noted in his book A brief History of Neoliberalism:

Redistributive effects and increasing social inequality have in fact been such a persistent feature of neoliberalization as to be regarded as structural to the whole project. Gérard Duménil and Dominique Lévy, after careful reconstruction of the data, have concluded that neoliberalization was from the very beginning a project to achieve the restoration of class power. (Chapter 1)

It is an ideology completely based on deception.  The set of lies that constitute the fundament of neoliberal ideology were brought to light as a band aid during the crisis of state capitalism in 70th. It also pretended to produce "heaven on earth" (and in this case is similar to communism). the only difference is that neoliberal promise heaven only "chosen" only, and "good life" for everybody else (pretending that it will lead to lifting standard of living for everybody, while making few obscenely rich). This mode of thinking is called supply side economy or "trickle-down economy".  As John Kenneth Galbraith aptly noted  that “Trickle-down theory - the less than elegant metaphor that if one feeds the horse enough oats, some will pass through to the road for the sparrows.”

If socialism absolulitized the power of state, neoliberalism fall into another extreme (and remember that extremes meet). It absolutize the "market" (understood as freedom of financial oligarchy to do what they want) and the law of jungle in competition (which means unconditional surrender of all power to the largest transnationals and first of all banks and rape and plunder of smaller firms and states, probably more fierce then under any form of state capitalism).  But neoliberal pretences of minimizing the state is another deception. They want to minimize only those branches of state that control behaviour of capitalists, while increasing dramatically repressive power of state to prevent any possibility of revolt. In other words neoliberalism logically lead to creation of national security state, the development which we observe in several countries, but first of all in the USA and Great Britain.  In this sense neoliberalism can be viewed as one of the modern flavors of neofascism.

It was a false, misleading and pretty seductive ideology from the very beginning created with a specific goal to deceive by people who can be called intellectual criminals. The most interesting part of neoliberalism is that the whole ideology was custom created for particular political goals of financial elite, which managed to hire stooges like Milton Friedman and others to accomplish the task.

So one of the most interesting features of neoliberalism is that it was custom tailored for restoration of power of  financial elite, or, as they are called after 2008, for banksters. But it proved to be more relevant and long lasting then band aid covering post New Deal financial revanchism of banksters, acquiring a life of its own.

Gradually it became full fledged ideology, much like Marxism before (and it did borrowed a lot from Marxism, especially from Trotskyism, and first of all the idea that politically organized minority can always dictate its will to unorganized majority as well as  "permanent revolution" memo (concertized into 'export democracy"  instead of "liberation from capitalism oppression and in a very slick way replacing uprising of "proletarian" with uprising of fifth column specifically organized and financed to accomplish a  "color revolution".  In both case criminal elements are welcomed (especially in the form of football fanatics). In both cases the preliminary phase was creation or establishing control over the sizable part of MSM (in modern days that included TV  channels, not only newspapers like in classic Marxism). Role of Communist International emissaries was adopted by staff of the US embassies. The goal is also the same in both case -- violent acquisition of power of the new elite by whatever means possible.

Like Marxist political economy, neoliberalism has certain economic postulates (see "Washington Consensus"). As a philosophy is oscillating between atheistic Satanism ("greed is good"), Randism ("cult of entrepreneurships", "Entrepreneurs aka "creative class" as Ubermench")  and post modernism ("rejection of absolute truth").

 In 80th in the USA it essentially became  a new  "secular religion" for the elite, shredding remnants of Christian morality. As foundations of neoliberalism such as neoclassical economy and Trotskyism are disconnected from the reality, both requires from the followers blind, unquestioned  obedience like in high demand cults.  But remuneration under neoliberalism to top echelon of functionaries is much better ;-) While in both case a good money are paid for the top layer of the sect, under neoliberalism the pay acquired obscene levels; that actually includes paid stooges in economic department which were bough "en mass".  Bribes in a form of fees for "lectures" reach a several hundred thousand dollars).

It is difficult to define neoliberalism more precisely but the restoration of unlimited power of financial oligarchy is definitely its one of key features. The same level of unlimited unchecked power it enjoyed at the beginning of XX century and which was destroyed by the Great Depression.

As such the neoliberal project has multiple dimensions all of which are supported by a hypertrophied, intrusive spying apparatus of neoliberal state which reminds the Third Reich with the aggressive, militarized  police. A combination which make protests or, god forbid revolt against neoliberalism much more difficult.

Three principal dimensions of neoliberalism -- political, ideological and cultural

As the latest stage of predatory capitalism, neoliberalism is part of a broader economic and political project of restoring class power and consolidating the rapid concentration of capital, particularly financial capital (Giroux 2008; 2014).  In his article   “Protesting Youth in the Age of Neoliberal Cruelty”, Professor Henry A. Giroux points out that like communism,  neoliberalism can be viewed in three principal dimensions -- political, ideological and cultural.

The real goal of neoliberalism is re-distribution of power and related redistribution of wealth up id a true feudal fashion. That's why neoliberalism also can be called neo-feudalism (which is another similarity with Bolsheviks and USSR)  The neoliberal project is really about weakening the power of middle class and impoverishing everybody other then top 20% of population in favor of maximizing the power of the tiny elite (the top 0.1%). 

As such, neoliberalism  is a broad strategy of economic (and first of all financial), political, cultural and military elites to destroy social-democratic state and to restructure power relationships, institutions, by injecting into the society, like narcotic, an artificial and a priory false ideology (civil religion), which is extremely beneficial for the promotion of interests of the top 0.1% (aka "super-elite", represented mainly by financial oligarchy both in the US and in in other countries; in the latter they represent the fifth column of neoliberal globalization).

Marx famous phase "Religion is the opium of the people" here acquires different and more modern and more menacing context as neoliberal dogma really serve the role of opium.  And the way it is distributed strongly reminds opium wars of British empire.  The full quote from Karl Marx translates as: "Religion is the sigh of the oppressed creature, the heart of a heartless world, and the soul of soulless conditions. It is the opium of the people".

Like communism before, it is an ideology with its own international movement. If the slogan of Communist International (aka Comintern) was "workers of all countries unite" the slogan of neoliberal revolution are both "Elites of all countries unite" and "viva the law of jungles" or "if you see that guy who is ready to fall push him in the back". Of course with the appropriate PR smoke screen about free markets, freedomdemocracy and equal opportunity.

Like Marxism neoliberal ideology is the ideology of class hegemony (just for a different class ;-), which serves multiple roles

Some authors define neoliberalism differently. For example, Robert McChesney, defines neoliberalism as an economic paradigm that leaves a small number of private parties in control and able to maximize their profit at the expense of the other smaller players and the rest of population. It posits that business domination of society proceeds most effectively when there is a representative democracy along with a weak and ineffectual polity typified by high degrees of depoliticization, especially among the poor and working class. He notes that unlike in classic corporatism, which relies on mass mobilization, neoliberalism relies on the opposite trend (along the lines of "inverted totalitarism"): a distracted or apathetic or depoliticized public essentially "goes along" with this, using the dominance of consumerism as a Trojan horse of depolitization and the loss of community spirit("Bread and circuses"). In sum, neoliberalism is the immediate and foremost enemy of genuine participatory democracy, not just in the United States but across the planet, and will be for the foreseeable future. Globalization is the result of powerful governments, especially that of the United States, pushing trade deals and other accords down the throats of the world's people to make it easier for corporations and the wealthy to dominate the economies of nations around the world without having obligations to the peoples of those nations

This stress of depolitization is very important. It proved to be as efficient as mass mobilization of classic corporatism and achieve the same purposes with less violence. This stress of depolitization of population is commonly called Inverted Totalitarism. Indeed, promotion of envy and suppression of any honest and candid debates about neoliberalism in the United States and elsewhere is one of its most striking features suggesting communality with medieval Catholicism. Neoliberalism's loudest message is that there is no alternative to the status quo, "there is no alternative".

Perverted definition of freedom

David Harvey, the author of  A Brief History of Neoliberalism, defines neoliberalism as attempt to undermine power and sovereignty of governments by transnational corporations and establish the regime in which the power of financial oligarchy (aka power of "free market") is dominant in the society using the concept of freedom as a smokescreen.  For this purpose, neoliberal propaganda perverts the definition of 'freedom' in such a way, that it conceals redistribution of wealth up. Unlimited, unrestricted accumulation of money (aka greed") now is equated with human freedom.

Neoliberal state protects capital and at the same time tries to sheds as much social responsibility for the wellbeing of citizenry as possible. That's why neoliberal stat in 2008 bailed out corporate interests from bad decision making them whole, while destroying the safety net for "subprime" homeowners and lower part of the population. That's why neoliberal policies always result in rising inequality, slower economic growth, and drastic redistribution of income toward the upper class.

Neoliberalism has distinct tendency to convert state in national security states, in which as we noted before two distinct modes co-exists: permissive for capital and repressive for labor and social programs.  Here is one Amazon review of the book:

Malvin  on September 28, 2006 

Deconstructing neoliberalism's peculiar definition of 'freedom'

"A Brief History of Neoliberalism" by David Harvey is a concise and razor-sharp deconstruction of the neoliberal movement. Mr. Harvey convincingly demonstrates that neoliberalism is an ideology that has been wielded to enshrine elite privilege at the expense of people and the environment. Assiduously researched and cogently argued, Mr. Harvey offers a jargon-free and readable text that helps readers gain a greater understanding about the political economy of our neoliberal world and what this might hold for us in the future.

 Mr. Harvey explains that neoliberal propaganda has succeeded in fixating the public on a peculiar definition of 'freedom' that has served to conceal a project of upper class wealth accumulation. In practice, the neoliberal state assumes a protective role for capital while it sheds as much responsibility for the citizenry as possible. Mr. Harvey details how neoliberal theory is ignored whenever it comes time to bail out corporate interests from bad decision making while the safety net for the working class has been gradually eviscerated. The author effectively intersperses the text with graphs to illustrate how thirty years of neoliberalist policies has resulted in rising inequality, slower economic growth, higher incomes among the upper class, and other measures that serve to convincingly support and prove his thesis.

Mr. Harvey's history of how neoliberalism has gained ascendancy mostly treads through familiar ground but also highlights some key events that are sometimes overlooked by others. For example, Mr. Harvey relates the well-known stories of how the Chilean coup in 1973 opened the door for Augusto Pinochet to implement the first national experiment in neoliberalism, followed by Margaret Thatcher in Great Britain in 1979 and Ronald Reagan in the U.S. in 1980. However, we also gain greater appreciation about the importance of the New York City bankruptcy in the 1970s. We learn how the city's financial crisis allowed for the imposition of neoliberal reforms in a manner that would prove to be a familiar template around the world: the rollback of labor rights, the privatization of public assets, cuts in public services, and increased policing, surveillance and political repression of a markedly polarized population.

Mr. Harvey surveys neoliberalism around the world to discover connections and to analyze its effects. He finds that the U.S. economy has benefited immensely from its ability to extract tribute from other nations, including the U.S. financial community's probable engineering of crises in developing nations in order to scoop up devalued assets on the cheap. The author discusses how economic restructuring programs imposed on poor countries has benefited U.S. and other foreign investors while it has bolstered or created a small but powerful class of wealthy individuals in Mexico, South Korea, Sweden and elsewhere. In China, Mr. Harvey remarks about the ease with which neoliberalism has found a home in an authoritarian state where the political elite have amassed their fortunes by exploiting a defenseless working class. The author is particularly concerned about the symbiotic relationship that has developed between the U.S. and China and muses about the potentially catastrophic financial situation that the two countries' mounting debts might pose for each other and the world economy.

There are also other definitions. But all-in-all any viable definition need to underline the fact that neoliberalism is about the transnational economic elite taking larger share of resources, income and political power in the society away from middle class. So it always means "class war", as well as blatant enrichment of top 1% at the expense of other 99%.

Those new masters of the universe in expensive suits managed to plunder almost the same number of countries on the globe under the smokescreen of  protection of human rights, as Western powers during acquisition of colonies in XIX century. Any even after creating the most acute economic crisis in 2008 in the USA they still managed to privatize public assets and socialize all the losses. BTW the defense of human right never preclude the alliance with the most odious political regimes on the planet if such an alliance is about cheap hydrocarbons. Recently under the slogan "let us not allow bastards Russian dominate in our beloved Europe, they managed royally "f*ck EU, by cutting it from Russian hydrocarbons,  as Victoria Nuland deftly admitted in her famous remark". After that the U.S. financial oligarchs deftly dropped the Euro to the floor and knocked any attempts of economic integration of EU with Russia.

In this "enrichment of top 1%" (which means first and foremost the US oligarchs and their British counterparts) aspect neoliberalism is based on a strategies of capital accumulation based on the plunder of weaker countries by transnational capital. The integration (or re-integration as is case with the USSR) of most countries in global production and financial system was based of forming a narrow strata of comprador elite (aka fifth column). Transnational fraction of local elites in competition with nationally-oriented fractions won the state power (that's what color revolutions were about). They utilized this acquired power to restructure national economy in the interest of transnational corporation, sell assets to transnationals for pennies on a dollar, put the countries into huge debt (see Ukraine, Greece, almost all Southern Europe) and merge them into the new global manufacturing and finance system with the center at the USA in the role of powerless vassals.

This a new global, transnational corporations based social system emerged by breakdown of First World Keynesian capitalism (welfare states) and Third World "developmentalist" capitalism by abolishing two key features:

Globalization became a new efficient strategy of capital accumulation as it allowed to shake off compromises and concessions that has been imposed by middle class with upper strata or industrial workers on national governments of G7 countries in the preceding epoch, when the USSR exists as a countervailing force and by the mere fact of its existence suppresses appetite of internal financial oligarchy.  With the demolishing of gold standard in 1973 financial capital acquired unprecedented mobility and became able to operate across the borders in a new ways, which allows to eliminate the power of trade unions and state intervention, altering the balance of power in favor of international corporations. Emerging transnational elites instituted polices of deregulation, "supply-side" economics and regressive taxation creating new incentives for capital. Labor force was de-unionized and pushed into deregulated conditions with elimination of full time positions and adoption of "flexible labor" schemes. Via neoliberalism the world has became just a unified playing table for global corporations and states that support them. Material and political obstacles were removed as all states which undergone neoliberal revolutions shifted from post-WWII Keynesian social contract to serving transnational capital and transnational elites.

Neoliberalism also signifies a new historical period in the development of capitalism, the period of dominance of "monopoly-finance capital," and associated "Stagnation-Financialization trap" (SF trap) that drives processes of financial expansion in the economy from one bubble to another due to desperate attempts to stave off the tendency for stagnation of the "real economy" under the neoliberal regime.

While ideological postulates behind neoliberalism (Washington consensus) were discredited after financial crisis of 2008, it now persists in "zombie stage" as there is no viable alternatives and because the ability of transnational elite to find and fund a sufficient part of national elite (compradors) proved to be overwhelming for most states. And it is a quite powerful zombie which still is able to attack and suck blood from other countries which was recently demonstrated in Libya and Ukraine (Maidan).

Since 2007 some Latin American countries got governments that openly oppose neoliberalism. Direct military invasion against them is now more difficult as the threat of communism (which justified such invasions in the past) is off the map. But we can expect attempts to stage color revolutions or classic Coup d'état to reverse those events. One such color revolution (White revolution in Russia in 2011-2012) recently failed. Another (Maidan in Ukraine) is ongoing.

For G7 nations the neoliberalism in zombie stage might have staying power to survive until the end of the period of "abundant hydrocarbons" whether it means the next twenty or the next two hundred years. In any case they, and first of all the USA and GB, bet their prosperity on the viability of neoliberal regime and they now can't abandon it without significant losses.

Still ideological crash of neoliberalism in 2008 has its effects and the rest of the world gradually becoming less and less enthusiastic about neoliberalism, although few dare to openly argue with the USA policies. And for now the USA remains the sole superpower (new Roman Empire) and can economically squeeze or destroy dissident as we are now observing with Russia. 

But it is intellectually bankrupt doctrine, no question about it. Not long ago, the cold war ended with the restoration and triumph of capitalism in the form of neoliberalism on a global scale, and then, less than three decades later, neoliberal form of capitalism is, in turn, became as intellectually bankrupt as communism was in 1990th. By all accounts, the financial catastrophe of 2008 was not only the worst since the Great Depression economic crisis, but a political crisis that somewhat reminds the crisis of Marxist ideology in the USSR in 1960th and 1970th.

As neoliberalism no longer can be sold as the only viable ideological model for other countries, it is now force fed using the strength of American economics and American and NATO bayonets. As well as the strength of transnational elite interested in maintaining status quo (Soros, Rockefellers, Rothschilds, etc)

The vast technological and cultural superiority of the West also matters, although to a lesser extent, as China now became the key factory for the world and as such possesses most of the modern technologies on its factories (which belong to foreign corporation, but still are on China territory).

Another factor that prolongs the life of neoliberalism is that no viable alternative exists, although attempts of partial restoration of the power of national states in a form of state capitalism (Russia, China, USA) and more balanced approach between interests of national population and international corporations are attempted in various forms in various countries (Hungary, many Latin American countries).

Trotskyism for the rich;
Ideology of neoliberalism as the replacement of both Marxism and state capitalism

We can view neoliberalism as Trotskyism for the rich. See  Neoliberalism as Trotskyism for the rich

From political point of view neoliberalism vision is somewhat close to Communists vision. It also relies on state repression (despite demagogy of Washington consensus about "free markets") and generally can't exist without police state (or National Security State as we now call it; Total surveillance is just icing on  the cake). Under neoliberalism the state become more repressive toward lower 80% of population and, especially, labor, but much less repressive toward various forms of capital and, especially, large capital.

In this sense the only difference is the location of the capital: while the USSR was the holy land of communist world and Moscow its global capital, now the holy land of neoliberalism is the USA and the capital is Washington. With the USA government and Washington headquarters of IMF and World Bank making close analogy to Politburo of CPSU. Due to their strong tendency for political dictate US embassies in Eastern Europe and xUSSR space are sometimes called "Washington Obcoms".  As in following post in freerepublic.com

kronos77

Funny how clueless are foreigners about Russian commies. Putin plays tough man for better bargain positions while actually he accepts orders from Washington obcom (regional committee of CPSU). Putin serves to interests of oligarchs and conducts actually liberal anti-Russian policy. He like helps oligarchic vampires to suck out money from Russian economy and invest them in US economy and Western banks what is absolutely unacceptable for Russian commies.

Like with Comminist International, other states are just vassals who implement directions from benevolent "Washington Obcom" and install the leaders recommended by it, or face ostracism (YouTube) or, worse, direct military invasion... Funny, but it was the corrupt communist elite which put the major effort in helping to implement this vision via the dissolution of the USSR.

As Pope Francis noted that like Marxism in the past neoliberalism represents a new philosophy, new kid on the block. He see  principal feature of this new philosophy in what he called the "idolatry of money" and turning inequality into moral imperative (Evangelii Gaudium, Apostolic Exhortation of Pope Francis, 2013):

No to the new idolatry of money

55. One cause of this situation is found in our relationship with money, since we calmly accept its dominion over ourselves and our societies. The current financial crisis can make us overlook the fact that it originated in a profound human crisis: the denial of the primacy of the human person! We have created new idols. The worship of the ancient golden calf (cf. Ex 32:1-35) has returned in a new and ruthless guise in the idolatry of money and the dictatorship of an impersonal economy lacking a truly human purpose. The worldwide crisis affecting finance and the economy lays bare their imbalances and, above all, their lack of real concern for human beings; man is reduced to one of his needs alone: consumption.

56. While the earnings of a minority are growing exponentially, so too is the gap separating the majority from the prosperity enjoyed by those happy few. This imbalance is the result of ideologies which defend the absolute autonomy of the marketplace and financial speculation. Consequently, they reject the right of states, charged with vigilance for the common good, to exercise any form of control. A new tyranny is thus born, invisible and often virtual, which unilaterally and relentlessly imposes its own laws and rules. Debt and the accumulation of interest also make it difficult for countries to realize the potential of their own economies and keep citizens from enjoying their real purchasing power. To all this we can add widespread corruption and self-serving tax evasion, which have taken on worldwide dimensions. The thirst for power and possessions knows no limits. In this system, which tends to devour everything which stands in the way of increased profits, whatever is fragile, like the environment, is defenseless before the interests of a deified market, which become the only rule.

Simultaneously neoliberalism proved to be the most capable ideology to fight and displace Marxism. It actually inherited quite a bit from Trotskyism (see below), so in a way it was "evil twin" of Marxism. And it was relevant and effective not because it was a "better ideology", but because Marxism as ideology self-destructed due to several major problems caused by actual experience with state socialism as implemented in USSR and other countries of Warsaw block:

Neoliberalism as a strategy of class struggle for transnational elite


Bushonomics is the continuous consolidation of money and power into higher, tighter and righter hands

George Bush Sr, November 1992

Neoliberalism is not a collection of theories meant to improve the economy. Instead, it should be understood as a strategy of "class struggle" (in Marxist terms) designed to redistribute wealth upward toward an increasingly narrow fraction of population (top 1%). The essence of neoliberalism is well reflected in the listed above George Bush Sr. quote "...the continuous consolidation of money and power into higher, tighter and righter hands". Kind of revolt of the elite against common people, instead of revolt of proletarians against capitalists. The attempt to redistribute the wealth of nations in favor of the top 1% and especially top 0.01%.

From the very beginning neoliberalism was a project to restore of class power of US corporations owners and first of all financial oligarchy ("financial revanchism" was the major driver of neoliberalism), which was undermined by New Deal.

So it is not surprising the during neoliberal revolution (or more correctly counter-revolution) in the USA all redistributive postwar state capitalism policies that hurt financial elite came under attack. With the demise of the USSR, the necessity of such policies to ensure social peace disappeared and the elite (and first of all financial elite) got a carte blanch for decimating middle class, and redistributing the wealth up. Golden days of the US middle class not ended not exactly with the election of Reagan (remember his decimation of air traffic controller union) but with the election of Mr. Gorbachov. And they became a distant past under Clinton who sold Democratic Party to financial oligarchy and only become worse and worse under Bush II and Obama (who, social policy-wise, is just well-tanned Bush III). And on international arena brutal enforcement of Washington consensus became a norm. So Ukraine got under the same neoliberal steamroller.

Neoliberalism promises of "better future" for population outside top 1% were by and large political scam. In best case no more then top 20% of population can benefit from neoliberal policies. And that's in best case, which is applicable probably only to G7 countries. And the other bottom 80% experience a sharp decline of their standard of living. For "peripheral countries like Ukraine, Iraq, Chili, etc) instead of 80:20 the proportion in probably 90:10.

All-in-all neoliberalism as a social system always lower the average standard of life of people in countries which adopted it, never rise it. That happened even in countries which historically has very low standard of living of middle class such as former USSR republics and Eastern Europe. At the same time it tremendously improved standard of living of upper 10% (20% in case of G7 countries) of population, and, especially, the top 1% - the new aristocracy. And that top 10% has enough political power to keep and consolidate neoliberal counter-revolution and with help of G7 countries to spread it around the globe.

Transnational elite "International" proved be both more viable and durable then "proletarian International" envisioned by Marx and his followers. That does not mean that elites from other countries are treated as equal partners. No they are treated as "villagers that came to the city" but still they are given a chance to "merge" with local "aristocracy of wealth".

The USA is the center on neoliberal order, its capital. Neoliberalism is supported by projection of the USA military power and the use of US capital. It forces global economic integration on US terms at whatever costs to others. But with those reservations it is as close to "oligarchy of all countries unite" as one can get.

In a way Marx probably is turning in his grave, as his ideas were hijacked and implemented by the part of population he considered to be doomed. In other words Marxist idea of "class struggle" was turned to its head and converted into pervert "revolt of the elite" (and first of all financial oligarchy), unsatisfied with the piece of the pie it is getting from the society and stimulated by technological revolution (emergence of Internet and cheap mass produced computers). Neoliberal philosophy can be distilled into a single phrase: "Humanity begins at the rank of CEO" or as George Bush Sr, aptly said November 1992 it is "...the continuous consolidation of money and power into higher, tighter and righter hands."

Some authors like Colin Cronch in The Strange Non-death of neoliberalism consider it to be a new ruling class alliance. His basic idea is that at least in USA neoliberalism represents the shift of loyalty of the upper management class: following the Great Depression of 1930 a political alliance emerged between the upper management class and "salaried middle class" (which includes the top layer of blue and white collar workers, including quasi-management, clerical workers, and professionals, and which cannot be reduced to the traditional "working-class"). A severe profitability crisis of the 1970s with its inflationary excesses caused a fracture between upper management and "salaried middle class". From that point upper management allied with owners and financial oligarchy forming a new ruling class.

This neoliberal transformation of the society with the redistribution of wealth to the top 1% (or, more correctly, the top 0.01%) "have and have more" (as unforgettable G.W.Bush quipped) was completed in the USA in late 90th. The rest of population (aka moochers) and organization such as trade unions were undermined and decimated by financial oligarchy with near complete indifference to what happens with the most unprotected lower quintile of the population.

Like Russia in the past under Bolsheviks the USA became occupied country. And much like Bolsheviks in the past, the neoliberal reformers don't care about failures and contradictions of the economic system which drive the majority of country population into abject poverty. No they care about that their action such a blowing out financial bubble like in the USA in 2008 which definitely could move national economics toward the disaster ("off the cliff"). They have somewhat childish, simplistic "greed is good" mentality: they just want to have their (as large as possible) piece of economic pie fast and everything else be damned.

To that extent they have mentality of criminals and neoliberalism is a highly criminogenic creed, but it tried to conceal the racket and plunder it inflicts of the societies under dense smoke screen of "free market" Newspeak. That means that outside the USA and G7 countries which are the major beneficiaries of this "hyper globalization of élites" neoliberalism is an unstable social order, as plunder can't continue indefinitely. and as natural resources become more scarce, the fight for them might give advantages to "Asian" autocratic flavor of state capitalism.

Problems inherent in neoliberal model were also by-and-large masked for two decades by a huge shot in arms Neoliberalism got with the dissolution of the USSR. This particular event (which was just a decision of part on nomenklatura including KGB to join neoliberal counter-revolution) put on the dinner table of neoliberal elites half a billion people and quite a bit of resources to plunder. This gift of a century from Bolsheviks slowed down the process of plunder of G7 own population, especially in the USA. It is interesting to note that, like Bolsheviks in the past, neoliberal elite behaves more like occupiers of the country, then as a traditional, "native" aristocracy; this phenomenon was especially pronounced in Russia (privatization under Yeltsin regime) and other xUSSR countries. And in xUUSR space new neoliberal lords were almost as brutal as German occupiers during WWII.

So later neoliberalism in came under pressure even in G7 countries, including the USA, as slogan on a corner Wall Street cafe "Jump Suckers !" demonstrated so aptly in 2008 and later in Occupy Wall Street Movement (which probably should be named "get rid of Wall Street occupation of the country"). The latter was quickly undermined, dissipated by the emerging National Security State. Total surveillance makes opposition movements practically impossible.

Neoliberalism was also partially reversed in Chile (the first country on which neoliberal counter-revolution was launched), Russia, and several other countries. It was never fully adopted in northern Europe or Asian countries. The model of autocratic state capitalism used in Asian countries actually serves as the only viable and competing with the neoliberalism modern social organization. Move of manufacturing centers to China and other East Asian countries also moves political influence toward this region, away from the USA and G7. Recently China managed slightly push back western global brands in electronics (especially in Eastern European markets), producing competitive smartphones (Huawey, Fly, Lenovo), tablets (Lenovo), PCs and networking equipment such as routers and switches under this own brand names.

Neoliberalism was enforced under dense smoke screen of propaganda. One can see an example of this smoke screen in Thatcher's dictum of neoliberalism: "There is no such thing as society. There are only individuals and families." In foreign policy neoliberalism behaves like brutal imperialism (aka neocolonialism) which subdue countries instead of brute force either by debt slavery or combination of debt slavery with direct military intervention. In neoliberal view the world consist of four concentric cycles which in order of diminishing importance are

  1. Finance
  2. Economics
  3. Society
  4. Planet

In other words, finance and transnational financial institutions are considered to be the most important institutions of the civilization, the institutions which should govern all other spheres of life. It is clear that such one-dimensional view is wrong, but neoliberals like communists before them have a keen sense of mission and after they managed to accomplish its "long march through the institutions" (during which they gradually hijacked them in what is called Quiet coup) they changed the way Americans think (Using the "Four M" strategy -- money, media, marketing, and management)

A well-oiled machine of foundations, lobbies, think-tanks, economic departments of major universities, publications, political cadres, lawyers and activist organizations slowly and strategically took over nation after nation. A broad alliance of neo-liberals, neo-conservatives and the far right (including neo-fascists and religious right) successfully manufactured a new common sense, assaulted Enlightenment values and formed a new elite, the top layer of society, where this "greed is good" culture is created and legitimized.

As Crouch says in his book The Strange Non-death of neoliberalism:

a polity in which economic resources were very unequally shared would be likely to be one in which political power was also concentrated, economic resources being so easily capable of conversion into political ones. (Page 125)

... ... ...

...the state, seen for so long by the left as the source of countervailing power against markets, is today likely to be the committed ally of giant corporations, whatever the ideological origins of the parties governing the state. (Page 145)

Idolatry of money and finance; "Greed is good" as the key ethical principle of neoliberalism

Its key ethical principle of neoliberalism (only for the elite, never for prols or middle class) is "Greed is good" (as Gordon Gekko the personage of Wall Street (1987 film) quipped in the film). This strata of people (which starts on the level of CEO of major corporation) who preach those principle is assumed to be Übermensch. People below are considered to be "under humans", or "inferior humans" (Untermenschen)

According to Wikipedia, the inspiration for the "Greed is good" speech seems to have come from two sources. The first part, where Gekko complains that the company's management owns less than three percent of its stock, and that it has too many vice presidents, is taken from similar speeches and comments made by Carl Icahn about companies he was trying to take over. The defense of greed is a paraphrase of the May 18, 1986, commencement address at the UC Berkeley's School of Business Administration, delivered by arbitrageur Ivan Boesky (who himself was later convicted of insider-trading charges), in which he said, "Greed is all right, by the way. I want you to know that. I think greed is healthy. You can be greedy and still feel good about yourself".

As Pope Francis notes glorification of greed is socially destructive. While in all previous "classic" religions (including such social religion as Marxism) excessive greed was morally condemned, neoliberalism employed a slick trick of adopting "reverse", Nietzschean Ubermench morality. Here is a relevant quote from his Evangelii Gaudium, Apostolic Exhortation of Pope Francis, 2013

One cause of this situation is found in our relationship with money, since we calmly accept its dominion over ourselves and our societies. The current financial crisis can make us overlook the fact that it originated in a profound human crisis: the denial of the primacy of the human person! We have created new idols. The worship of the ancient golden calf (cf. Ex 32:1-35) has returned in a new and ruthless guise in the idolatry of money and the dictatorship of an impersonal economy lacking a truly human purpose. The worldwide crisis affecting finance and the economy lays bare their imbalances and, above all, their lack of real concern for human beings; man is reduced to one of his needs alone: consumption.

56. While the earnings of a minority are growing exponentially, so too is the gap separating the majority from the prosperity enjoyed by those happy few. This imbalance is the result of ideologies which defend the absolute autonomy of the marketplace and financial speculation. Consequently, they reject the right of states, charged with vigilance for the common good, to exercise any form of control. A new tyranny is thus born, invisible and often virtual, which unilaterally and relentlessly imposes its own laws and rules. Debt and the accumulation of interest also make it difficult for countries to realize the potential of their own economies and keep citizens from enjoying their real purchasing power. To all this we can add widespread corruption and self-serving tax evasion, which have taken on worldwide dimensions. The thirst for power and possessions knows no limits. In this system, which tends to devour everything which stands in the way of increased profits, whatever is fragile, like the environment, is defenseless before the interests of a deified market, which become the only rule.

No to a financial system which rules rather than serves

57. Behind this attitude lurks a rejection of ethics and a rejection of God. Ethics has come to be viewed with a certain scornful derision. It is seen as counterproductive, too human, because it makes money and power relative. It is felt to be a threat, since it condemns the manipulation and debasement of the person. In effect, ethics leads to a God who calls for a committed response which is outside of the categories of the marketplace. When these latter are absolutized, God can only be seen as uncontrollable, unmanageable, even dangerous, since he calls human beings to their full realization and to freedom from all forms of enslavement. Ethics – a non-ideological ethics – would make it possible to bring about balance and a more humane social order. With this in mind, I encourage financial experts and political leaders to ponder the words of one of the sages of antiquity: “Not to share one’s wealth with the poor is to steal from them and to take away their livelihood. It is not our own goods which we hold, but theirs”.[55]

Like Bolshevism and National Socialism before neoliberalism needs a huge propaganda machine comparable with the propaganda machines of Bolsheviks and the Third Reich. Neoliberal ethics is pushed through the throat by hundreds of radio stations, cable TV channels (with Fox as the most prominent stooge of neoliberal propaganda), magazines and newspapers (Wall Street Journal, NYT, etc). This ethics is presented as a specific philosophy of Randism which is an ultimate expression of neoliberal ethics.

Here analogy with Bolshevism became even more stark. When you think about the current Republican Party, you can distinguish a small circle of ideologues consisting by-and-large of Ayn Rand followers. In a way it reminds the original Ann Rand circle called "collective", which like Bolshevik's core consisted of Jewish intellectuals, such as Greenspan. And that is not a positive characteristic. Murray Rothbard, a member of Rand's circle for several months in 1958, described the Randroids as “posturing, pretentious, humorless, robotic, nasty, simple-minded....dazzlingly ignorant people.” (Sex, Ayn Rand and the Republican Party)

Like in Marxism the view of other classes (in this case lower classes) by this new alliance is hostile. They are parasites, moochers, etc (exactly like capitalist class in Marxism), all feeding from the state, which in turn deprives "masters of the university" the spoils of their ingenious activity. Neoliberalism professes open and acute hostility to "lower classes", as if modeled on Bolsheviks hatred of "capitalists". This hate (like hate in general) paradoxically gives neoliberalism a driving force: as Irish novelist Elizabeth Bowen quipped: "Some people are molded by their admirations, others by their hostilities."

And this Ubermench feature of neoliberalism attracts young people in the same way they were attracted to national socialism with its hate of racially inferior nations. In a way neoliberalism converted the concept of "Arian race" into the concept of morally and intellectually superior transnational elite.

Neofascism and neoliberalism

One of first experiments in introduction of neoliberal ideology (Pinochet putsch in Chile) has definite neofascist colors.

The worst violence occurred in the first three months of the coup's aftermath, with the number of suspected leftists killed or "disappeared" (desaparecidos) soon reaching into the thousand.[6] In the days immediately following the coup, the Assistant Secretary of State for Inter-American Affairs informed Henry Kissinger, that the National Stadium was being used to hold 5,000 prisoners, and as late as 1975, the CIA was still reporting that up to 3,811 prisoners were still being held in the Stadium.[7] Amnesty International, reported that as many as 7,000 political prisoners in the National Stadium had been counted on 22 September 1973.[8] Nevertheless, it is often quoted in the press, that some 40,000 prisoners were detained in the Stadium.[9] Some of the most famous cases of "desaparecidos" are Charles Horman, a U.S. citizen who was killed during the coup itself,[10] Chilean songwriter Víctor Jara, and the October 1973 Caravan of Death (Caravana de la Muerte) where at least 70 persons were killed.[11] Other operations include Operation Colombo during which hundreds of left-wing activists were murdered and Operation Condor, carried out with the security services of other Latin American dictatorships.
Memorial to victims of the Dirty war in Chile

Following Pinochet's defeat in the 1988 plebiscite, the 1991 Rettig Commission, a multipartisan effort from the Aylwin administration to discover the truth about the human-rights violations, listed a number of torture and detention centers (such as Colonia Dignidad, the ship Esmeralda or Víctor Jara Stadium), and found that at least 3,200 people were killed or disappeared by the regime.

A later report, the Valech Report (published in November 2004), confirmed the figure of 3,200 deaths but dramatically reduced the alleged cases of disappearances. It tells of some 28,000 arrests in which the majority of those detained were incarcerated and in a great many cases tortured.[12] Some 30,000 Chileans were exiled and received abroad,[13][14][15] in particular in Argentina, as political refugees; however, they were followed in their exile by the DINA secret police, in the frame of Operation Condor which linked South-American dictatorships together against political opponents.[16] Some 20,000-40,000 Chilean exiles were holders of passports stamped with the letter "L" (which stood for lista nacional), identifyng them as persona non grata and had to seek permission before entering the country.[17] Nevertheless, Chilean Human Rights groups maintain several hundred thousand were forced into exile.[14]

According to the Latin American Institute on Mental Health and Human Rights (ILAS), "situations of extreme trauma" affected about 200,000 persons; this figure includes individuals killed, tortured (following the UN definition of torture), or exiled and their immediate relatives.[citation needed] While more radical groups such as the Movement of the Revolutionary Left (MIR) were staunch advocates of a Marxist revolution, it is currently accepted that the junta deliberately targeted nonviolent political opponents as well

A court in Chile sentenced, on March 19, 2008, 24 former police officers in cases of kidnapping, torture and murder that happened just after a U.S.-backed coup overthrew President Salvador Allende, a Socialist, on September 11, 1973.[18]

Neofascist putsch in Chile got stamp of approval personally from Milton Friedman, who actually was instrumental in moving Chile into neoliberal orbit (Neoliberalism - Wikipedia, the free encyclopedia):  

In 1955, a select group of Chilean students (later known as the Chicago Boys) were invited to the University of Chicago to pursue postgraduate studies in economics. They worked directly under Friedman and his disciple Arnold Harberger, while also being exposed to Hayek. When they returned to Chile in the 1960s, the Chicago Boys began a concerted effort to spread the philosophy and policy recommendations of the Chicago and Austrian schools, setting up think tanks and publishing in ideologically sympathetic media. Under the military dictatorship headed by Pinochet and severe social repression, the Chicago boys implemented radical economic reform. The latter half of the 1970s witnessed rapid and extensive privatization, deregulation, and reductions in trade barriers. In 1978 policies that would reduce the role of the state and infuse competition and individualism into areas such as labor relations, pensions, health, and education were introduced.[2] These policies resulted in widening inequality as they negatively impacted the wages, benefits and working conditions of Chile's working class.[49][50] According to Chilean economist Alejandro Foxley, by the end of Pinochet's reign around 44% of Chilean families were living below the poverty line.[51] In The Shock Doctrine, Naomi Klein argues that by the late 1980s the economy had stabilized and was growing, but around 45% of the population had fallen into poverty while the wealthiest 10% saw their incomes rise by 83%.[52]

Two decades after it was first used by pro-market intellectuals in the 1960s, the meaning of neoliberalism changed. Those who regularly used the term neoliberalism in the 1980s typically applied it in its present-day, radical sense, denoting market fundamentalism.

In 1990 the military dictatorship ended. Hayek argued that increased economic freedom had put pressure on the dictatorship over time and increased political freedom. Many years earlier, in The Road to Serfdom (1944), Hayek had argued that "economic control is not merely control of a sector of human life which can be separated from the rest; it is the control of the means for all our ends."[53] The Chilean scholars Javier Martínez and Alvaro Díaz reject that argument pointing to the long tradition of democracy in Chile. The return of democracy had required the defeat of the Pinochet regime though it had been fundamental in saving capitalism. The essential contribution came from profound mass rebellions and finally old party elites using old institutional mechanisms to bring back democracy.[54]

The essence of neoliberalism is globalization of corporatism, which previously have distinct national boundaries and some forms of which were rabidly nationalistic (for example German national socialism). Just imagine a single global state with the capital in Washington with the typical for such a superstate flow of people to capital and you essentially catch the essence of the USA elite neoliberal dream -- Pax Americana.  There are also second class cities such as London, Berlin, Tokyo, etc which while not as attractive are much better then the "deep province", such as Prague, Warsaw or Sanct-Petersburg. to say nothing about "countryside" such as Kiev, Tallin, Riga, Vilnus.

So the flow of people and commodities (and first of all oil) has distinct direction from the periphery to the center. To keep each country in the line and this flow of commodities uninterrupted, this "Capitalist International" relies on the part of national capitalist class and elite which is connected to international corporations serving the same role as Communist Parties or Communist International. Such as part is often called Compradors or Fifth Column of Globalization

And this "international elite" is even more responsive to pressure from Washington,  as its fortunes and often families reside if "first class cities" of G7. This way neoliberalism is able to suppress the other part of the elite of particular country which favors "national" development and typically resides inside the country. As a PR smokescreen neoliberalism pay lip service to national development, but in essence it is hostile to it and favor "underdevelopment" of nations outside G7. It's anti-social and has distinct schadenfreude attitude to weak nations: it derives pleasure from seeing the misfortunes of other nations and it try to exploit such moments ("disaster capitalism"). Vae victis as Romans used to say (Victor's justice).

And the winner in neoliberal revolutions is not the middle class and lower strata of population (although they might be sold on it and fight for it, being deceived by propaganda as is the case with the current generation of Americans), but international and local oligarchy represented via international corporations and banks. For bottom 90% population the hangover after the neoliberal revolution comes really quick. This affect was clearly visible after successful color revolution in Serbia, Georgia and Ukraine.

In cases of Georgia and Ukraine the neoliberal leaders lost power after their term and there were efforts to put them in jail for abuse of power and corruption, which were not successful only due to USA pressure (only former Ukrainian Prime Minister Julia Timoshenko, the Joan of Arc of Orange revolution was jailed). In any case popularity of leaders of neoliberal revolutions drops to almost unheard levels with Victor Yushchenko commanding 2% approval rating in Ukraine before the end of his term.

Neoliberalism also has common with fascism "white man burden" syndrome (I cite Neoliberalism is fascism):

One last prefatory remark: I think it is important to recognize that fascism (forms of contemporary conservatism) is a result of neoliberal thought. It is not simply a supplement that aims to save neoliberalism from itself. So, even as forms of religious fundamentalism provide supplements to the extremes of neoliberalism, neoliberalism on its own has horribly conservative effects. The passage below comes from:

TCS Daily - House of Pain: Why Failure Is Important.

Every successful society has devised ways of separating incompetent or systematically unlucky people from the control of valuable resources. (That's why civilized nations provide children and legally incompetent individuals with guardians and trustees.) This is an essential process for all but the most wealthy of nations, e.g., those cursed by great oil wealth. (This windfall wealth situation is the national analogue of individuals winning the lottery; a harbinger of bad things that follow the lack of a need to husband resources.)

A society's economic success is increased if it has sure and quick ways to accomplish this separation, however painful to those who suffer losses. While there will be political pressures to buffer folks from the consequences of economic folly or bad luck, it is socially dangerous to do so. Reality checks should have force, so that those who fail to prudently manage resources will not keep control over them.

Let's identify the problems with the passage. First, failure is a matter of incompetence or bad luck. Although bad luck is qualified with the term 'systemic,' the writer's flip attitude overlooks systemic forms of exclusion like race, sex, or citizenship. It occludes as well the impact of inherited wealth (a form of the systemic protection of the incompetent) and generational poverty. Second, incompetence and bad luck are equated with being civilized. To be unlucky, then, is to be childlike, immature, incompetence, and barbaric (attributes long associated with justifications for colonialism). I'm going to skip the section on oil wealth, although I would think that people with more knowledge of the Middle East and the ways that the Mid East figures in neoliberal rhetoric would have interesting things to add here.

Neoliberalism as an integral part of American Messianism

Neoliberalism is not merely a new pseudo-religious, cult-like version of globalized corporatism. Like national socialism before it is also simultaneously a powerful ideological export product. It is the core of Pax Americana, which the USA tries to impose of the rest of world. As Samuel P. Huntington(1927 – 2008), the author of the concept of  Cleft country expressed this view, the idea of Pax Americana means that:

"a world without US primacy will be a world with more violence and disorder and less democracy and economic growth than a world where the United States continues to have more influence than any other country in shaping global affairs. The sustained international primacy of the United States is central to the welfare and security of Americans and to the future of freedom, democracy, open economies, and international order in the world."

Similar ideas were expressed in 1998 book The Grand Chessboard American Primacy And Its Geostrategic Imperatives by  Zbigniew Brzezinski. From one of Amazon reviews:

And ponder the meaning of these statements in a post-9-11 world:

While this is typically associated with neocon thinking, it is shared belief of the majority of the US elite. In 1992, the US Defense Department, under the leadership of Secretary of Defense Dick Cheney [later to be George Bush Jr.’s VP], had the Pentagon’s Under Secretary of Defense for Policy, Paul Wolfowitz [later to be George Bush Jr.’s Deputy Secretary of Defense and President of the World Bank], write up a defense document to guide American foreign policy in the post-Cold War era, commonly referred to as the “New World Order.”  The Defense Planning Guidance document was leaked in 1992, and revealed that,

“In a broad new policy statement that is in its final drafting phase, the Defense Department asserts that America’s political and military mission in the post-cold-war era will be to ensure that no rival superpower is allowed to emerge in Western Europe, Asia or the territories of the former Soviet Union,” and that, “The classified document makes the case for a world dominated by one superpower whose position can be perpetuated by constructive behavior and sufficient military might to deter any nation or group of nations from challenging American primacy.”

Further, “the new draft sketches a world in which there is one dominant military power whose leaders ‘must maintain the mechanisms for deterring potential competitors from even aspiring to a larger regional or global role’.” 

As  the official state ideology of the USA where it became an integral part of American Messianism it was successfully exported to many countries.  And it now permeates many aspects of social cooperation and culture. Like in the USSR the whole generation of people in the USA had growth being brainwashed by this ideology. It dictates an extremely militant almost jingoistic (does not hesitate to exercise force or overthrows the governments), foreign policy (Trotskyites idea of export of revolution in full swing), it is as deceptive as bolshevism (what Washington means by the "spread of democracy" is actually spread of neoliberalism), missionary (regards itself as a monopolist of the "truth" and protector of "universal values" ) and colonizing (serving simultaneously the ideology behind Neocolonialism). Like Communism it is also messianic as in "the end justifies the means" and does not abstain from using dirty methods including black propaganda and color revolutions for achieving its goals. In the level of hypocrisy and methods used against "natives" it reminds British empire or the USSR (your choice ;-). 

It blackmails antagonists as depraved, primitive, and below par. A good sample of neoliberal blackmail can be extracted from the US press coverage of preparations to Iraq war( US press enlists for war on Iraq) and Libya coup d'état. Another good set of samples provides Guardia press coverage of Putin's Russia and Ukraine EuroMaidan events.  Funny but Russia occupies the middle ground between neoliberalism and resource nationalism, so in principle it coul be an alli of the USA and GB,  but as a large country and possible geopolitical opponent it also was in crosshairs of the US elite.  One of the reasons for Russia's defeat in Chechnya between 1994 and 1996, was an attempt by America in the 1990s, with tremendous help from the comprador part of Russian elite it managed to create, to turn Russia into a standard neoliberal vassal state, whose elites would be subservient to the US foreign policy and would exist to export raw materials to the West and to transfer money to Western bank accounts. That attempt failed with Putin coming to power. So now the level of animosity from the USA and British elites and serving them MSM now goes over the roof .

With the notable exception of the USA itself, neoliberalism is hostile to nationalism. That does not exclude flirting with neo-fascist elements in countries were neoliberalism is under attack from the left or from the resource nationalists. But those forces are viewed more like tactical allies (Ukraine is a good example) and can be thrown under the bus, when they do their dirty job. Inside the USA, the holy city of neoliberal ideology, it to a certain extent merged with American Exceptionalism; the USA is viewed as exemplarity neoliberal country, the shining city on the hill which has right to impose their views and interests on the rest of the globe with impunity, standing outside the law.

Redistribution of income and lowering the standard of living of the bottom 80% of population

While welfare state presuppose redistribution of income down, the "free market capitalism" presupposes even more powerful redistribution of income up, toward the most wealthy part of the population.

Unlike previous revolutions (with the exception of Bolsheviks revolution) the unique feature of neoliberal revolution is drastic lowering the standard of living of middle class and poor, along with dramatic enrichment of top 1% of population and international corporations. Standard of living of top 20% also grow, albeit not so dramatically. In a way it is equivalent to selling of local population into slavery to international corporations by local oligarchy. with the interesting Pareto style 80:20 split. In other words only 20% of population get something from neoliberal revolution with over 50% concentrated at, way, the top 5%, and lion share in top 1%. This "top 20%" of beneficiaries constitute "fifth column of neoliberalism" in the particular state.

Lower 80% of population standard of living typically dramatically drops after neoliberal revolution and never recover.  That does not mean that those capitalists who favor "national" development are considerably less brutal in exploiting lower 80% population, but at least the "spoils" of this exploitation are left by and large in the country and used to improve infrastructure, housing, education  and such while neoliberal model of exploitation often is sucking the vassal states dry. Former Eastern European countries such as Bulgaria, Rumania and Serbia provide especially interesting and educational example of how neoliberalism deforms the economy and impoverish population. Especially Bulgaria, this basket case of Europe.

There are some exceptions like China (which practice not pure neoliberalism bus a mixture of neoliberalism with national development, kind of "neoliberalism with Chinese face" ;-), but even in China this process of dramatic enrichment of top 1% is clearly visible although it is not accompanied with drastic lowering of standards of other 99% of population like happened in Russian, Ukraine and other post Soviet republics. Again in the level of decimation of local middle class and poor neoliberal revolutions have a lot in common with Bolshevik's revolution in Russia of 1917.

Here is a quote from insightful Amazon review by razetheladder of Chalmers Johnson book Blowback The Costs and Consequences of American Empire:

Johnson's strength is in recounting the specificities of US foreign policy; he's much weaker at an overall understanding of imperialism. He seems to think that American policymakers have naively built up the economic strength of their Japanese, Korean, and now Chinese competitors by focusing on maintaining their own military power. This is an old critique, resting on the notion that imperialism hurts the imperialists.

But Johnson is relying on the idea that "America" is a unitary entity, so that the hollowing out of industry hurts "America", not specific social groups within the country. In reality, US foreign policymakers work to advance the interests not of "America", but of those same business elites that have benefited from turning Asia into the world's sweatshop and undermining the unions that built their strength on American industry. American economic imperialism is not a failed conspiracy against the people of Asia, but an alliance between American elites and their Japanese, Korean, Indonesian, and Chinese counterparts - against the potential power of the working majority in all those countries.

But it's more complex than that, too, since the US seeks to prevent the emergence of an independent military challenge (especially China, but also Japan) to its Asia hegemony while seeking to expand the power of American commercial interests in the region, even as it tries to keep Asian elites happy enough with the status quo to prevent their rebellion against it.

Elite and the second and third world countries

Neoliberalism as an ideology can be succinctly defined as "Transnational elites Uber Alles". But it uses the concept of elite on the level of the of the countries too. Neoliberalism distinguishes between to types of countries, and. respectively, there are two forms of neoliberalism, one for G7 countries (elite) where while squeezing middle class it operates with "velvet gloves", and a more brutal practice from "prols" countries outside G7 (vassal countries with local elites as fifth column of globalization). Neoliberalism relies mainly on financial mechanisms and banks and use brute force only as a secondary weapon for subduing people and minor countries (you can get much farther with a kind neoliberal word and cruise missiles, then with just kind neoliberal word alone). In time, it generally coincides with computer and Internet revolution, which made globalization of labor via outsourcing of production and services to poor countries much more attractive.

In principle we can define two distinct types of neoliberalism: one for elite countries and the other every other country:

Actually some elements of the idea of "national superiority" were preserved by reserving for the USA special "shining beacon on the Hill" status (American Exceptionalism) and in a form superiority of "creative class" which includes capitalists, financial oligarchy, and "executives" (top layer of transactional corporate elite) plus narrow social strata of people who are serving them (and that includes most journalists, programmers and IT staff, and such).

In a way, neoliberalism considers this so called "creative class" to be a new Arian race. Everybody else are Untermensch and should be treated as disposables.  In other words it is more like a religion that claim  supremacy of particular ethnic group or a class.  See for example a Guardian reader comment made in 2011 (you need to brose the comments as direct link does not work; recently Guardian screwed its comment system completely):

ITS1789 13 Sep 2011 14:15

I'm not from the left, and I personally do really, really well out of the capitalist system, and enjoy a life of relative luxury, but then I can afford to give half my annual income away to charity and still live very well. I like capitalism, it's been very good to me, and my family for over two centuries, but the ghastly version that's swept the world over the last thirty years is something else.

I think neoliberalism is something close to a malignant cancer growing inside a healthy capitalism, and with equally disastrous consequences. So my criticism comes not from the left, but from the right, for what that's worth.

Neoliberalism is a kind of pseudo-religion, a dogma, which is passionately believed by its disciples, despite the evidence showing that it simply doesn't work in the real world, but like most religious fanatics, the real world doesn't matter much to them. Which is another reason they remind me of Stalinists in the old Soviet system.

... ... ...

For me neoliberalism is a primitive and dangerous delusion about society, economics, and human nature, comparable to extreme forms of socialism, which are equally hairbrained and destructive, and arguably just as bloody.

Thatcherism was classic, class-warfare politics, but launched from the extreme right instead of the left, and it was wildly successful, at least for those it benefitted, a narrow strata at the top of society. Now that the entire charade is collapsing, and taking the welfare state, the middle class, and probably capitalism itself, with it, it's time to pay the bill for this long, illusory, party.

Neoliberalism, cheap hydrocarbons, and economic crisis of 2008

There essence of neoliberalism is not only dominance of finance over other sectors of the economy, but also free movement of goods and people by global corporations without any respect for national borders. And that is the source of increasing efficiency and dropping prices on many categories of goods. An interesting question is how much the rise of neoliberalism was forced on humanity by the short historical period of availability of cheap hydrocarbons.

"Cheap Energy" is important driver of globalization. Even the previous stage of globalization: the creation of colonial empires by Great Britain, France, Germany and Spain was at least partially based on availability of steam power and coal.

Now it is an oil that serves the same role for the global neoliberal empire. The latter allow cheap global transportation, mass air travel and powers huge US military machine which has no equals in the globe and serves as a guarantor of security of neoliberal regimes all over the globe. Out of three major components of globalization -- the US as a sole superpower, cheap international shipping and air travel, and (to lesser extent) global telecommunication networks the first two definitely depends of cheap energy. And, BTW, Google is also not running of holy spirit; it is one of the top consumers of electrical energy in the USA.

While it is unclear to what extent neoliberalism will be affected by rising energy prices, it seems few things arouse more passions these days then "oil plato" (or how it is often, but incorrectly, called the oil peak) and how it affects the civilization and different countries. The key fact is that EROEI (energy return on energy invested) of oil extraction is rising dramatically for the last two decades and it looks like this trend will continue. The current world oil production has EROEI around 40 so you extract forty times as much of energy then you spend for extraction.

New oil discoveries have EROEI around 10 (with bitumen oil sand EROEI in single digits). And EROEI also the source of the current disconnect between the purchasing power of money and the resources available to back that up. Pessimists say that a further increase in fuel prices is inevitable, and sooner or later the world will face a kind of "offshoring apocalypse". That's unlikely as important part of neoliberal regime is the new level of global communications and this part will be by-and-large intact. But transportation costs will affect the globalization in a negative way without any dount. For example with EROEI in single digits mass air travel will come to a screeching halt.

At the same time the end of cheap hydrocarbons era might marks the start of fuel wars, which, as such, will be a drastic reversal of globalization, playing the same role as WWI. When each state will try to pull the energy blanket, globalization trends will definitely suffer.

Rise of cost of energy makes both offshoring of manufacturing and outsourcing of service jobs to other countries less viable. A growing number of American companies are moving their manufacturing back to the United States. This emerging "re-shoring movement" has to be kept in proportion. Most of the multinationals involved are bringing back only some tiny fraction of their production destined for the American market. Much of what they had moved over the past few decades remains overseas. Moreover some firms like Caterpillar decided to move research and development facilities in China as split between manufacturing and research badly affects both research and the quality of final products.

But re-shoring tendencies can't be easily dismissed. They are driven by powerful forces which might only get stronger with time. Boston Consulting Group (BCG) in April 2012, notes that 37% of those with annual sales above $1 billion are planning shifting production facilities from China to America. Of the very biggest firms, with sales above $10 billion, the number reached 48%. Among reason sites are rising Chinese labor costs and transportation costs. Many shipping companies slowed the speed of their ship (increasing the delivery time) in order to fight rising oil prices. As Economist, the flagship of neoliberal establishment thought in GB, noted (Reshoring manufacturing):

The Massachusetts Institute of Technology looked at 108 American manufacturing firms with multinational operations last summer. It found that 14% of them had firm plans to bring some manufacturing back to America and one-third were actively considering such a move. A study last year by the Hackett Group, a Florida-based firm that advises companies on offshoring and outsourcing, produced similar results. It expects the outflow of manufacturing from high- to low-cost countries to slow over the next two years and the reshoring to double over the previous two years. “The offshoring of manufacturing is now rapidly moving towards equilibrium [zero net offshoring],” says Michel Janssen, the firm’s head of research.

By contrast, pay and benefits for the average Chinese factory worker rose by 10% a year between 2000 and 2005 and speeded up to 19% a year between 2005 and 2010, according to BCG. The Chinese government has set a target for annual increases in the minimum wage of 13% until 2015. Strikes are becoming more frequent, and when they happen, says one executive, the government often tells the plant manager to meet workers’ demands immediately. Following labour unrest, wages at some factories have gone up steeply. Honda, a Japanese carmaker, gave its Chinese workers a 47% pay rise after strikes in 2010. Foxconn Technology Group, a subsidiary of Hon Hai Precision Industries, a Taiwanese firm that does a lot of manufacturing for Apple and other big technology firms, doubled pay at its factory complex in Shenzhen after a series of suicides. Its labour troubles are still continuing.

...As soon as 2015, says Hal Sirkin, a consultant at the firm, it will cost about the same to manufacture goods for the American market in certain parts of America as in China in many industries, including computers and electronics, machinery, appliances, electrical equipment and furniture. That calculation takes into account a wide variety of direct costs, including labour, property and transport, as well as indirect ones such as supply-chain risk.

...“Pay for senior management in several emerging markets, such as China, Turkey and Brazil, now either matches or exceeds pay in America and Europe”

So while production and service outsourcing overseas or offshoring can still provide substantial cost savings for many companies, the question arise whether those cost savings are sustainable (Can outsourcing overseas provide sustainable cost savings).

Crisis of 2008 undermined the legitimacy of neoliberalism much like WWII undermined the legitimacy of communism. But alternatives did not exits and instead of wreaking neoliberalism it converted it is aggressive, bloodthirsty zombie stage, which is the current stage of neoliberalism development (see below). It is interesting to note that  three competing perspectives on the crisis do not include the role cheap hydrocarbons in development of neoliberalism and the crisis of 2008 (Palley, 2012, cited via thomaspalley.com): 

US neoliberal empire and the stages of development of neoliberalism

See American Imperialism, Transnational Capitalist Class and Globalization of Capitalism

Market fundamentalism as an ideology of neoliberalism; Washington Consensus

Market fundamentalism is an ideology of neoliberalism and represents a pseudo-scientific approach to economic and social policy based on neoclassical theories of economics that absolutized the role of the private business sector in determining the political and economic priorities of the state and consider privatization as the ultimate solution of all problems in the society.

Like social theories behind Italian and German versions of corporatism ideology of neoliberalism is pretty eclectic. It is discussed at some additional length at pages related to the topic Casino Capitalism on this site.

We need to note, there the neoliberal ideology adoption and implementation patterns varies from country to country, like it was actually with the classic corporatism as well. In the USA this form of corporatism emerged in most radical form. Another center of neoliberalism was GB in which it also has had a more radical form then, say, in Spain or Italy.

And we called the US version of neoliberalism radical, it is not a metaphor: corporatism under General Franco is a pale shadow of corporatism under Bush-Obama regime.

This new stage of capitalism development is often called "corporate socialism" of "socialism for rich" or "socialism for banks". The latter name is applicable because the key component of transnational elite is financial oligarchy. All of those terms reflect the key fact that at this stage of capitalism development it is the transnational elite and first of all financial oligarchy which completely dominates power structures of the society. Due to the role of financial oligarchy in this new elite this social system was also nicknamed Casino Capitalism.

Neoliberalism should probably be viewed as a further development of a form of corporatism that emerged in the USA in late 60th. It came to power in Ronald Reagan administration which was in a way Quiet coup. And it became completely dominant after the collapse of the USSR during Clinton regime during which Democratic Party also adopted neoliberalism as an official platform.

The term itself emerged in the 1970s, when some Latin American economists began using "neoliberalism" to designate their program of market-oriented reforms. It has come into wide use starting with 1973 Chilean coup d'état. After triumph of neoliberalism in Chile under Augusto Pinochet (from 1973) neoliberalism spread to Great Britain under Margaret Thatcher (from 1979) and then to the United States under Ronald Reagan (from 1981). Broadly speaking, neoliberalism seeks to transfer control of the economy from the public to the private sector with the state providing guarantees only to corporations and not to individual citizens like under socialism. That's why is often called "corporate socialism".

After dot-com bust of 2000-2002, however, the term "neoliberalism" had become a pejorative used to denigrate prostitution of economics performed by Milton Friedman and Chicago school . This trend increases after financial crisis of 2008-2012. So it is probably fare to say that right now neoliberalism entered the stage of decline. The last important victory of neoliberalism was probably navigating Russia into joining WTO, which happened in summer of 2012.

It has neoliberal Newspeak that include such terms as "free market", efficiency, consumer choice, transactional thinking and individual autonomy. In essence this is an modernized ideology of merger of state and corporate power that was hallmark of classic corporatism, with an additional twist of emphasizing the Arian style theories of inferiority of lower classes (reflected in promoting the "class of creators", entrepreneurs( Randism), etc) and "ultimate justice" of redistributing wealth to the top 1%.

On state level it tries to abolish social programs and completely shift the risks to individuals (replacing pensions with 401K plan in the USA), while fully providing social protection to corporations, especially financial giants involved in casino style gambling. In other words it socialize private losses and privatize social program that benefits of individual citizens.

Neocolonial aspects of neoliberalism are often called "Washington Consensus", a list of policy proposals that appeared to have gained consensus approval among the Washington-based international economic organizations (like the International Monetary Fund (IMF) and World Bank) and directed on making developing nations "debt slaves" of the industrialized nations. This policy got tremendous impetus with the dissolution of the USSR when the principal foe, which to certain extent limited the level of greed in such deals due to fear of "communist infiltration" if case deal is too one sided, folded.

The concept and name of the Washington Consensus were first presented in 1989 by John Williamson, an economist from the Institute for International Economics, an international economic think tank based in Washington, D.C. The list created by Williamson's included ten points:

  1. Legal security for property rights;
  2. Financialization of capital.
  3. Fiscal policy Governments should not run large deficits that have to be paid back by future citizens, and such deficits can only have a short term effect on the level of employment in the economy. Constant deficits will lead to higher inflation and lower productivity, and should be avoided. Deficits should only be used for occasional stabilization purposes.
  4. Redirection of public spending from subsidies to people to subsidies to corporations (tax breaks, preferred regime, etc). Especially hurt were classic socialist programs, which neoliberal call "indiscriminate subsidies" that neoliberal deem wasteful. They are limited to those what benefit corporations such as primary (but not university) education, primary health care and infrastructure investments. Pensions and other social problems need to be privatized.
  5. Tax reform– broadening the tax base by shifting tax burden to the poor and middle classes and adopting low taxes for corporations and top 1% with the states goal to encourage "innovation and efficiency";
  6. Interest rates that are market determined and positive (but moderate) in real terms;
  7. Floating exchange rates;
  8. Trade liberalization – liberalization of imports, with particular emphasis on elimination of quantitative restrictions (licensing, etc.); any trade protection to be provided by law and relatively uniform tariffs; thus encouraging competition and long term growth. Financial liberalization under the smoke screen of trade liberalization and complete dominance of foreign banks in local financial systems of developing countries.
  9. Liberalization of the "capital account" of the balance of payments, that is, allowing people the opportunity to invest funds overseas and allowing foreign funds to be invested in the home country
  10. Privatization of state enterprises; Promoting market provision of goods and services which the government can not provide as effectively or efficiently, such as telecommunications, where having many service providers promotes choice and competition.
  11. Deregulation – abolition of regulations that impede market entry or restrict competition, except for (G7 only) those justified on safety, environmental and consumer protection grounds, and prudent oversight of financial institutions;

A Decade Long Triumph of Neoliberalism after the Dissolution of the USSR

As we mentioned before, the greatest triumph of neoliberalism was the dissolution of the USSR in 1991. After this event, there was a period of "triumphal march of neoliberalism", which lasted probably till 2005, when each year it claimed as a victory yet another country (Yeltsin neoliberal gang rule in Russia lasted till 2000, all former socialist countries were converted to neoliberal regimes shortly after, Kosovo in 1999; Serbia in 2000; Iraq in May, 2003; Georgia in December 2003; Ukraine in 2004). It also managed to stabilize and improve the situation in the USA. Plunder of Russia and other xUSSR states along with Internet revolution were two factors that influenced relative prosperity of the USA in 1994-2000.

And like Catholicism in Europe in Middle Ages, in 90th neoliberalism looked like an incontestable ideology propagated by "sole superpower" (" anew holy Roman Empire") with the help of vassals and subservient financial institutions such as World Bank and IMF. The dominance on the USA in 1991 looked rock-solid and if somebody told me in 1999 that in less then 20 years the USA would be on ropes both politically and financially I would just laugh. Still after the dissolution of the USSR neoliberalism managed to dissipate most of the gains in approximately 20 years and in 2008 entered the phase of structural crisis. As of 2013 the idea of self-regulating market is dead and even solidarity of international elites, the hallmark of neoliberalism, is under question.

The first cracks in neoliberalism facade were caused by Clinton's attack on Yugoslavia in 1999, the first armed neoliberal crusade attempted under the smoke screen of protecting the right of Kosovo Muslims in Serbia. It failed to implement "regime change" in Serbia and despite overwhelming military superiority of NATO forces has shown that bringing neoliberal regime on the tips of bayonets is a costly and high risk exercise. It took another several years and a color revolution in Serbia to achieve those goals. It did established the second Muslim state in Europe (effectively NATO protectorate), which was a part of the plan.

Color revolution in Serbia started a series of other successful color revolutions in Serbia (Serbia's Bulldozer Revolution in 2000) ,Georgia (Saakashvili regime came to power in November 2003 as a result of "Rose revolution"), Ukraine (Viktor Yushchenko regime came to power in 2004 via Orange Revolution) and several other countries.

After those successes, there were several setback: color revolutions failed in Belorussia and Russia. Results of color revolution in Ukraine were partially reversed by government of Viktor Yanukovych who ousted Yushchenko government defeating Yulia Tymoshenko in 2010 election (with Yutchshenko personally having less the 3% support). They are close to partial reversal in Georgia where Saasaskvily regime is hanging in the air.

Fear of the population and establishment of "National Security State"
to protect the interest of transnational elite

Politically neoliberalism correlates with growth of political power of financial oligarchy and media-military-industrial complex. Growth of political power of financial oligarchy among national elite has led to the dramatic growth of inequality and created growing fear of the top 0.01% (oligarchs) over preserving their power and financial gains.

That naturally leads to the establishment of National Security State" state, militarization of police and introduction of total surveillance over the citizens under the pretext of fighting against terrorists.

In the article GCHQ taps fibre-optic cables for secret access to world's communications by Ewen MacAskill, Julian Borger, Nick Hopkins, Nick Davies and James Ball, the authors describe blanket surveillance regime (21 June 2013, The Guardian) in comparison with which KGB and even STASI looks like complete amatures:

Britain's spy agency GCHQ has secretly gained access to the network of cables which carry the world's phone calls and internet traffic and has started to process vast streams of sensitive personal information which it is sharing with its American partner, the National Security Agency (NSA).

The sheer scale of the agency's ambition is reflected in the titles of its two principal components: Mastering the Internet and Global Telecoms Exploitation, aimed at scooping up as much online and telephone traffic as possible. This is all being carried out without any form of public acknowledgement or debate.

One key innovation has been GCHQ's ability to tap into and store huge volumes of data drawn from fibre-optic cables for up to 30 days so that it can be sifted and analysed. That operation, codenamed Tempora, has been running for some 18 months.

GCHQ and the NSA are consequently able to access and process vast quantities of communications between entirely innocent people, as well as targeted suspects.

This includes recordings of phone calls, the content of email messages, entries on Facebook and the history of any internet user's access to websites – all of which is deemed legal, even though the warrant system was supposed to limit interception to a specified range of targets.

As Glenn Greenwald wrote in his article Are all telephone calls recorded and accessible to the US government? (May 4, 2013, The Guardian):

Every day, collection systems at the National Security Agency intercept and store 1.7 billion e-mails, phone calls and other types of communications.

It would also help explain the revelations of former NSA official William Binney, who resigned from the agency in protest over its systemic spying on the domestic communications of US citizens, that the US government has "assembled on the order of 20 trillion transactions about US citizens with other US citizens" (which counts only communications transactions and not financial and other transactions), and that "the data that's being assembled is about everybody. And from that data, then they can target anyone they want."

Despite the extreme secrecy behind which these surveillance programs operate, there have been periodic reports of serious abuse. Two Democratic Senators, Ron Wyden and Mark Udall, have been warning for years that Americans would be "stunned" to learn what the US government is doing in terms of secret surveillance. Strangely, back in 2002 - when hysteria over the 9/11 attacks (and thus acquiescence to government power) was at its peak - the Pentagon's attempt to implement what it called the "Total Information Awareness" program (TIA) sparked so much public controversy that it had to be official scrapped. But it has been incrementally re-instituted - without the creepy (though honest) name and all-seeing-eye logo - with little controversy or even notice.

In his book "Brave New World Order" (Orbis Books, 1992, paper), Jack Nelson-Pallmeyer identifies seven characteristics of a such a state:

  1. The military is the highest authority. In a National Security State the military not only guarantees the security of the state against all internal and external enemies, it has enough power to determine the overall direction of the society.
  2. Political democracy and democratic elections are viewed with suspicion, contempt, or in terms of political expediency. National Security States often maintain an appearance of democracy. However, ultimate power rests with the military or within a broader National Security Establishment.
  3. The military and related sectors wield substantial political and economic power. They do so in the context of an ideology which stresses that 'freedom" and "development" are possible only when capital is concentrated in the hands of elites.
  4. Obsession with enemies. There are enemies of the state everywhere. Defending against external and/or internal enemies becomes a leading preoccupation of the state, a distorting factor in the economy, and a major source of national identity and purpose.
  5. The working assumption is that the enemies of the state are cunning and ruthless. Therefore, any means used to destroy or control these enemies is justified.
  6. It restricts public debate and limits popular participation through secrecy or intimidation. Authentic democracy depends on participation of the people. National Security States limit such participation in a number of ways: They sow fear and thereby narrow the range of public debate; they restrict and distort information; and they define policies in secret and implement those policies through covert channels and clandestine activities. The state justifies such actions through rhetorical pleas of "higher purpose" and vague appeals to "national security."
  7. The church is expected to mobilize its financial, ideological, and theological resources in service to the National Security State.

You can probably safely replace the term "military" with the term "finance" in the above list to make it more applicable to contemporary neoliberal societies. And if you think about, it finance is a new form of warfare. In any case National Security State is now reality and by-and-large displaced the previous form, called Inverted Totalitarism which existed from late 40th to late 80th.

Criminogenic effects of neoliberalism

The fact the neoliberalism is highly criminogenic is well established. The postulate "greed is good" implicitly assumes that the legal system is perfect. In order to distinguish greed from enlightened self-interest, we will define greed is self-interest taken to an extreme or unseemly degree. A “greedy” market participant that seeks to gain at the expense of others and the society at large. So in essence this is a parasitic behavior. This might be done within the legal framework exploiting loopholes in it, but most commonly it involves a violation of the law that is difficult to enforce and are supported internally by corporate brass (A Troubling Survey on Global Corruption - NYTimes.com):

A new survey of corporate officials and employees in 36 countries — in Europe, Africa and the Middle East, as well as India — indicates that there is plenty of corruption that needs investigating.

Over all, 20 percent of the respondents said they knew of incidents at their own companies within the previous year that could be construed as cooking the books — moves to either understate expenses or overstate revenue. Among senior managers and directors, the figure was 42 percent.

It is typically difficult to determine what the optimal set of laws is; lawmakers must make their best guess, and in most cases they pass laws that are proved to be suboptimal over time. Holes in those laws can be systematically exploited. Also law always lags behind market and technological developments; it is difficult for lawmakers to know how to regulate things like new products or new investment vehicles. That creates another opportunity to engage in destructive for the society as whole behavior without fear of punishment by the law. Neoliberalism also is "sociopath friendly" regime in a sense that sociopathic qualities became a desirable for the top brass. And with sociopathic leadership in place it is difficult to imagine what the improper business is. "Creative destruction" in this case becoming something like a pack of wolves against a sheep.

Wall Street also developed two step combination: first weaken the law, and then engage in criminal behavior that is now decriminalized. In other words, if one argues that it is perfectly acceptable for people to be greedy, the problem is that there is no mechanism to constrain greedy people so that they can do no harm to others. As history demonstrates pretty convincingly (with the 2008 crisis as the most recent example), the legal system typically fails to place the appropriate constraints on such market behavior. That's why additional mechanisms are important for society survival and prosperity, and that's why most world religions consider greed to be a vice. This brings us to works of John Kenneth Galbraith and his discussion of the necessity of countervailing economic forces. Neoliberalism destroyed those countervailing forces over the last several decades.

Since the legal system can not and never in reality guarantee that markets function efficiently, there is a role for other institutions to foster a more enlightened self-interest as a social norm and thus improve efficiency. It's mostly about how self-interest is channeled that makes the difference, since eliminating self-interest seems similarly sociopathic (the USSR is a perfect example here). We would be a lot better off to channel self-interest in financial sector productively, than let it run wild foraging on speculation, arbitrage, and monopolization.

But it is those institutions that can channel self-interest in a more productive way, that neoliberalism systematically tries to weaken. In this sense neoliberalism is not only criminogenic, it is self-destructive. Moreover, unethical behavior is arguably more of the rule of corporate conduct rather than the exception. As such it represents a systemic flaw of neoliberalism as a flavor of corporatism. And the Great Recession of 2008 is a direct manifestation of this systemic flaw. In other words it was not accidental, it was not the first and it is not the last.

Example of Russia neoliberal revolution of 1989-1994 is probably one of the most terrifying examples of this trend. But the situation in the USA after 2008 is structurally even worse as it entails much more sophisticated layers of corruption and first of all almost complete corruption of the government by financial oligarchy (nobody was prosecuted for the financial crisis of 2008). It signified the creation of two separate caste of citizens with the upper caste being above the law, much like it was with Nomenklatura in the USSR.

Neoliberalism also exploits fundamental problem that in any large bureaucracy dealing with huge sums of money people have bad and/or contradictory incentives and lack of accountability creates opportunity for corruption. So in way it is using corruption for the purposes of maintaining the neoliberal regime, which is pretty unique feature. And, despite appearance, all large bureaucracies are prone to corruption.

One of the key mechanisms of corruption that is used under neoliberal regime is so called "the revolving door". It works in both direction: from top corporate seats to government and back.

Typically people who moved to government from private industry are not forgetting your former friends, especially in crisis (Paulson is a very good example here, but any Secretary of Treasury probably is not much worse example either). There are also implicit incentives to help your former employer, when there is an opportunity for a multimillion dollar deal. Also in this variant of "revolving door" regime, those who are coming to the government or to the public service have the incentive structure and morale they acquired in their prior employer -- a large corporation.

When a long time government servant is expecting to join a corporation after leaving the government there is a strong, but implicit incentive not to hurt future friends. Income inequality is probably one of the root causes for this. If incomes in public and private sector were not so much out of balance, few people would be motivated to sell themselves out so shamelessly.

But with the current level on income inequality this mechanism works wonders to emasculate regulatory agencies top brass. The mechanism that efficiently replicates this governance systems and keeps it in place one of the central part of criminality of neoliberalism: the conscious breaking down of institutional capacity of state to regulate business activity. Thus creating the situation of "mafia state", with the oligarchy instead of regular Mafiosi.

The other key mechanism is bribing the press corps to present (often close to criminal) actions favorable to oligarchy (in a words of Margaret Thatcher), as "There Is No Alternative" (TINA). BTW in Russian "tina" is the highly viscosious, amorphous substance on the bottom of the lake or swamp. In the latter case it can swallow people or animals. This effect is the same as for "Neoliberal TINA". Typically "TINA" works by remapping the debate to exclude anything not favorable to the financial elite (Journalists in the service of Pete Peterson Remapping Debate). Here is how stealing from Social Security to preserve recent gains by financial elite was presented during debates on (note the terminology) "curbing the country’s “unsustainable” debt and deficits.":

  • Maria Bartiromo, 2011 (host, CNBC’s “Closing Bell with Maria Bartiromo”)
  • Tom Brokaw, 2012 (former anchor and managing editor, NBC Nightly News)
  • Erin Burnett, 2012 (host of CNN’s “Erin Burnett OutFront”)
  • John F. Harris, 2012 (editor-in-chief of Politico)
  • Gwen Ifill, 2011, 2010 (senior correspondent of “PBS NewsHour”)
  • Ezra Klein, 2011 (columnist, Washington Post)
  • Jon Meacham, 2010 (former editor-in-chief, Newsweek)
  • Bob Schieffer, 2010 (host, CBS “Face the Nation”)
  • Lesley Stahl, 2010 (reporter, CBS “60 Minutes”)
  • George Stephanopoulos, 2012 (host, ABC’s “This Week”)
  • David Wessel, 2012, 2011 (economics editor, Wall Street Journal)
  • George Will, 2011 (columnist, Washington Post)
  • Judy Woodruff, 2012, 2011 (host, “PBS NewsHour”)
Peterson, however, is hardly a disinterested and dispassionate observer of such discussions. In fact, he is now beginning his fourth decade of arguing that there is no alternative to enacting “entitlement reform” (read: cut Social Security and Medicare) and “tax reform” (read: raise regressive taxes and lower progressive ones) in the name of curbing the country’s “unsustainable” debt and deficits.

An essential and successful element of the Peterson strategy is to create an environment where it is widely if not universally believed that there is no alternative to his vision. The conceit is that those with “courage” will see past narrow, partisan concerns and embrace an ideal: a bipartisan consensus that has the strength to demand “shared sacrifice” from a childish and selfish populace. A review of the proceedings of the Fiscal Summits of the last three years makes agonizingly clear that most of the journalists who conducted interviews or moderated panel discussions both reflected and amplified the Peterson worldview...

So, for example, Lesley Stahl, the CBS “60 Minutes” reporter, was fully a part of the Erskine Bowles and Alan Simpson deficit-cutting team during her interview with both men: “You are going to have to raise taxes and cut things, big things, put restrictions on Social Security. Everybody knows that.”

Virtually none of the reporters thought to ask about or suggest an alternative path, such as preserving Social Security benefits and bolstering the system’s reserve by raising the cap of wages subject to Social Security taxes (currently annual wages above approximately $110,000 are not subject to any Social Security tax).

And most questioning proceeded either on the false assumption that deficits were derived from excessive spending on entitlements or as though they had mysteriously, but inevitably, come to pass.

Many journalists fairly shouted their personal desire to see greater cooperation and “compromise,” with groups realizing the importance of submerging their interests to the greater good. Who should do the submerging? In 2012, Tom Brokaw had a suggestion in the form of a question to former President Bill Clinton: after Wisconsin Governor Scott Walker pushed through a bill undermining the right of union members to collectively bargain, shouldn’t those workers have just sat down and negotiated with Walker as, Brokaw said, “has been traditionally done in this country” instead of “gather[ing] outside the capitol”?

There were a couple of exceptions to the rule. In a session moderated by Ezra Klein of the Washington Post in 2011, Klein posed a number of questions that reflected an unwillingness to operate from within the Peterson framework. For example, Klein asked New York Times columnist David Brooks whether, instead of blaming Americans for simply wanting benefits without paying for them, the causes of the debt should be located in the Bush tax cuts, two unfunded wars (Iraq and Afghanistan), and the federal government’s emergency response to the financial crisis.

Judy Woodruff, of the PBS NewsHour, generally asked questions from within the Peterson frame, but, at one point in 2012, posed a question that perhaps all the journalists should have been thinking about as well. She asked Rep. Christopher Van Hollen, Jr. (D-Md.) if “Democrats like you, by participating in forums like this one that is all focused on austerity, on cutting the deficit and the debt…really become also window dressing for a conservative agenda that is anti-jobs and anti-recovery and wrongheaded economics?”

Over the course of the three years of fiscal summits that Remapping Debate examined, the other journalist interviewers and moderators hewed strictly to the conventional Peterson wisdom. What follows are annotated illustrations of this recurring problem.

Neoliberalism as a key contributor to growth of amorality and economic crimes

Although neoliberal regime is not necessarily a kleptocracy (although Yeltsin regime definitely was), the difference is only in a degree. It does use corruption and criminality to stabilize the neoliberal regime and protect it from backlash that follow economic crisis caused by excessive appetite by financial oligarchy (if I am sounding like a communist here it is not accidental; as people of former USSR observed: communism was all wrong about socialism, but it was surprisingly realistic in its views of capitalism). And as for corruption it is pretty ironic that the USA tried to position itself as a leader of anti-corruption crusade, because as Niall Ferguson noted (quoted from Zero Hedge):

“It is corruption when corporations can buy regulation. It is corruption when laws are sponsored by Wall Street.

It is a sad state when the current level of corruption of the U.S. government is what was once only associated with third world countries ruled by dictators. The problem is that corruption of major institutions and first of all regulators is predicament for any country which adopted neoliberal model, and the US in no exception. Niall Ferguson called it "suffering from a third world disease.". In his new book The Great Degeneration he states the central question of the “great degeneration” is whether our institutions, and first of all institution which should uphold the rule of law are degenerating. He thinks that there are four symptoms of degeneration:

Quite frankly, like in the case of international financial capital, the most necessary constituents that define organized crime are in place so the difference in only in degree:

Organized crime or criminal organizations are transnational, national, or local groupings of highly centralized enterprises run for the purpose of engaging in illegal activity, most commonly for monetary profit

Quoting Wikipedia:

In the United States, the Organized Crime Control Act (1970) defines organised crime as "The unlawful activities of [...] a highly organised, disciplined association [...]".[3] Criminal activity as a structured group is referred to as racketeering and such crime is commonly referred to as the work of the Mob. In the UK, police estimate organized crime involves up to 38,000 people operating in 6,000 various groups.[4] In addition, due to the escalating violence of Mexico's drug war, the Mexican drug cartels are considered the "greatest organised crime threat to the United States" according to a report issued by the United States Department of Justice.[5]

By all estimates Mexican grug cartels dwarf the size and wealth of the US financial sector.

If you think that the increasing level of penetration of Mexican mafia into the US is the result of external forces think again. In a way Reagan regime was a clear invitations for any self-respectful international crime syndicate to start operating in the US territory. And the exposition of crime that was a side effect of neoliberal counterrevolution in Russia has a distinct blowback effect in the USA. The same reasoning is applicable to various sophisticated financial crimes including computer related. What you expect unemployed or semi-employed for 300 dollars a month programmers to do to in order to provide a living for themselves and their families.

Neoliberalism and propaganda of amorality

As Will Hutton noted in The Guardian neoliberalism doctrine entail direct propaganda of amorality( Across Europe, political leaders have lost the trust of their people:

There was a time when to live a life virtuously was well understood. It embraced personal integrity, commitment to a purpose that was higher than personal gain, a degree of selflessness and even modesty. Those at the top may have got there through ruthlessness and ambition, but they understood that to lead was to set an example and that involved demonstrating better qualities than simply looking after yourself.

No more. Perhaps the greatest calamity of the conservative counter-revolution has been the energy it invested in arguing that virtue, whatever its private importance, has no public value. The paradox, the new conservatives claim, is only through the pursuit of self-interest can the economy and society work best. Responsibilities to the commonweal are to be avoided.

The retreat of virtue has become the plague of our times. Greed is legitimate; to have riches however obtained, including outrageous bonuses or avoiding tax, is the only game in town. But across the west the consequences are becoming more obvious. Politics, business and finance have become blighted to the point that they are dysfunctional, with a now huge gap in trust between the elite and the people.

In the USA it took more then three decade to eliminate morality and to establish "law of jungle" mentality in the population. In other countries such as Russia this process was much quicker and run deeper. And in no way this newly acquired level of criminally is reflected in incarceration statistics. Most of "neoliberal-style: crimes are financial crimes and as such they are difficult to direct and difficult to procedure. sometimes they are impossible to procedure either because of the political influence of the players or potential effect on the economy if particular persons and institutions are brought to justice. The latter factor was acknowledged by the US justice department.

Neoliberalism propagates criminal behavior by creating acute means-ends discrepancies and due to excessive cultural emphasis on monetary or material success goals ("greed is good" mentality) for members of society. At the same time mobility is restricted and majority of members of the society has no realistic chances to attain those goals. Still media brainwashing incites the desire more than they have. Success stories of going from rags to riches make the American Dream more believable, despite the fact that it is deeply and irrevocably fake. As this cultural meme is internalized it creates a strain, which combined with the culturally induced underemphasize on the proper methods, stimulates deviance of various types. If the deviant solution is successful (i.e., perpetrators are not caught or adequately punished), this adaptation may become normative for others in a similar social context. To the extent that this solution is available to them (demand for illicit goods or services, access to illegitimate opportunity structures), they may adopt this role model -- and may be expected by their significant others to follow this path. This process creates a vicious circle toward higher rates of deviance and widespread anomie under neoliberal regime. Anomie is a withdrawal of allegiance from conventional norms and a weakening of these norms' guiding power on behavior. This is caused by structural contradictions within the neoliberal doctrine and affects deviance in two ways. One is associated with strain, relative deprivation, frustrations, and the almost obsessive focus on goals. This makes deviance thinkable, as conventional norms are regarded as nonbinding, at least temporarily. Rationalizations enable departures from otherwise accepted/internalized social rules, as actors convince themselves that in their particular circumstances an exception is acceptable. Through interactive processes, techniques of neutralization and rationalizations contribute to a context in which newly socialized actors may adopt normative referents and deviant behavior as a matter of course. If "this is the way business is done around here," people may engage in price fixing or misleading advertising or insider trading or running a prostitution ring. While those criminogenic effects of neoliberalism became prominent in the USA as was demonstrated by 2008 financial crisis, when most of financial players involved were engaged is behavior that is deeply and irrevocably asocial and amoral. However, a very similar process is now being reproduced throughout the world. Promises are made that are not fulfilled. People's expectations are exalted at a time when economic and power asymmetries increase and become less justifiable and intolerable in the eyes of the people affected. The logic of the market permeates popular thinking and introduces rationalizations, making the adoption of a criminal or unethical solution more acceptable. This high criminogenic impact of globalization and neoliberal policies is extremely difficult and costly to reverse.

Moral relativism and concept of "Justice for some"

Moral relativism means that anything that helps to achieve the goal is moral. It was actually pioneered by Marxism in context of means to be used to achieve "proletarian revolution". It is a part of Randism as a ersatz version of Nietzschean Philosophy.

Corruption, facilitated by the credibility trap, is the biggest problem facing the West today. That is the real subsidy, the most debilitating entitlement.

It is the belief of the elite that the power of their office is an achievement that rewards them with the right to lie, cheat and steal, both for themselves and their friends.

Although it is most important to understand that they would be shocked and insulted if one uses those words, lie, cheat and steal, to describe what they are doing. They view themselves as exceptionally hard working, as obligated by their natural gifts and superiority.

Through a long indoctrination that starts sometimes in their families, but is most often affirmed in their elite schools and with their circle of privileged friends, they learn to rationalize selective moral behaviour not as immoral but as 'the entitlement of success.' And they are supported by a horde of morally ambivalent enablers who will tell them whatever they wish to hear.

There are one set of rules for themselves and their friends, and another set of rules for the rest.

Few who actually do evil consciously choose to be evil. They rationalize what they do in any number of ways, but the deceit often hinges on their own natural superiority, and the objectification and denigration of the other. We are makers, and they are takers. Although many may work hard, they see their own work as having special value and merit, while the actions of the others are inconsequential and unworthy.

Given enough time, their rationalizations become an ideology, desensitized to the meaning and significance of others outside their own select group. This supremacy of ideology empties their souls, and opens the door to mass privation and even murder, although rarely done by their own hands.

This is what Glenn Greenwald calls 'justice for some.' Or even earlier what George Orwell captured in the slogan, 'Some animals are more equal than others.'

And just to be clear on this, with regard to the Anglo-American political situation, the tragedy is not that just some are corrupted, which is always the case. The tragedy is that the Democrats and the Labor Party learned that they could become as servilely corrupted by Big Money as the Republicans and the Conservative Party, while maintaining the illusion of serving their traditional political base.

And it has rewarded them very well in terms of extraordinarily well-funded political power, and almost unbelievable personal enrichment afterwards.

In such a climate of corruption, political discourse loses the vitality of ideas and compromise for the general good, and take on the character of competing gangs and crime families, engaged in aggressive schemes and protracted turf wars, tottering from one pitched battle and crisis to another.

As Jesse put in his blog Jesse's Café Américain
"A credibility trap is a condition wherein the financial, political and informational functions of a society have been compromised by corruption and fraud, so that the leadership cannot effectively reform, or even honestly address, the problems of that system without impairing and implicating, at least incidentally, a broad swath of the power structure, including themselves.

The status quo tolerates the corruption and the fraud because they have profited at least indirectly from it, and would like to continue to do so. Even the impulse to reform within the power structure is susceptible to various forms of soft blackmail and coercion by the system that maintains and rewards.

And so a failed policy and its support system become self-sustaining, long after it is seen by objective observers to have failed. In its failure it is counterproductive, and an impediment to recovery in the real economy. Admitting failure is not an option for the thought leaders who receive their power from that system.

The continuity of the structural hierarchy must therefore be maintained at all costs, even to the point of becoming a painfully obvious, organized hypocrisy.

The Banks must be restrained, and the financial system reformed, with balance restored to the economy, before there can be any sustainable recovery.

The problem which the modern world has not yet grappled is how to react to the rise of a global elite, which considers itself to be above national restraints, and a law unto themselves.

Their success has been propelled by the dominance of Anglo-American financialization, and the rise of oligarchies in Russia, China, Latin America, and India. Countervailing power has been co-opted and in many cases eliminated. Any opposition has become marginalized and isolated.

The new oligarchs are supported by fiat currencies of respective national goverements, which together the increase of insubstantial 'cashlessness' in wealth. The latter provides much greater ability to reallocate wealth.

Legal arbitrage

Legal arbitrage is a powerful instrument for transnational corporations to press government into compliance. As soon as government tries to impose some restriction on their operations they threaten to leave.

This behavior is by-and-large conditioned by the low price of oil. With price of oil above, say $200 per barrel, transportation costs became big enough to make this behavior less likely

Globalization and deregulation supports selective justice, to the extreme detriment of local legal regimes (outside G7), and individual choice and freedom. The new global elite consider themselves to be a new Arab sheiks, a law unto themselves, above what they consider subhuman restraint. Or using Nietzschean terminology, Übermenschen.

“Our light-speed, globally connected economy has led to the rise of a new super-elite that consists, to a notable degree, of first- and second-generation wealth. Its members are hardworking, highly educated, jet-setting meritocrats who feel they are the deserving winners of a tough, worldwide economic competition—and many of them, as a result, have an ambivalent attitude toward those of us who didn't succeed so spectacularly. Perhaps most noteworthy, they are becoming a transglobal community of peers who have more in common with one another than with their countrymen back home. Whether they maintain primary residences in New York or Hong Kong, Moscow or Mumbai, today's super-rich are increasingly a nation unto themselves...

A multibillion-dollar bailout and Wall Street’s swift, subsequent reinstatement of gargantuan bonuses have inspired a narrative of parasitic bankers and other elites rigging the game for their own benefit. And this, in turn, has led to wider—and not unreasonable—fears that we are living in not merely a plutonomy, but a plutocracy, in which the rich display outsize political influence, narrowly self-interested motives, and a casual indifference to anyone outside their own rarefied economic bubble."

Chrystia Freeland, The Rise of the New Global Elite

The Consequences of Neoliberalism in Third World Countries and xUSSR space: stagnation instead of growth

Being an implementation of the "law of jungles" on international scene with the USA as a 100 pound gorilla, the neoliberal regime has distinct criminogenic character both within the USA (unpunished financial crimes made by top management of leading Wall Street banks and investment firms) and, especially, in "newly liberalized" countries of former USSR ("a New Latin America"). Which is the main "sphere of influence" of international corporations from G7 countries.

Along with internationalization of economies and integration of elites there was internalization of organized crime and growth in sophistication of criminal methods of appropriation of wealth, including those used by international corporations.

In this discussion we will follow key points of the article Global Anomie, Dysnomie, and Economic Crime Hidden Consequences of Neoliberalism and Globalization in Russia and Around the World

Introduction

TRANSNATIONAL CRIME HAS RECENTLY ACQUIRED A PROMINENT PLACE IN PUBLIC debates. It is commonly presented as the most significant Crime problem at the turn of the millennium (Myers, 1995-1996; Shelley, 1995). Many have even suggested that it represents a serious domestic and international security threat (Paine and Cillufo, 1994; Williams, 1994). The argument is also made that a wave of transnational crime undermines policies and the functioning of an increasing number of market economies around the globe (Handelman, 1995; Shelley, 1994). As a consequence, the proposed remedies are often quite drastic and involve undercover operations, privacy-piercing approaches, and the participation of intelligence services in the fight against global crime (Andreas, 1997; Naylor, 1999; Passas and Blum, 1998; Passas and Groskin, 1995).

Yet, little attention and virtually no systematic research has been devoted to understanding the causes, structure, extent, and effects of serious cross-border misconduct (Passas, 1998). The risks it poses may be grossly exaggerated (Naylor, 1995; Lee, 1999). The draconian measures being contemplated and implemented in different countries, therefore, are essentially an exercise in shooting in the dark. Chances are good that the target will be missed and substantial "collateral damage" may be caused by ill-conceived policies in this "war" on crime. This risk is particularly high in countries in transition toward a market democracy. It would be much wiser, thus, to carefully study the problem before taking ineffective and possibly damaging actions.

This article seeks to make a contribution by concentrating on the causes of transnational economic crime. The main argument is that, contrary to conventional wisdom, neoliberalism and globalization contribute to processes leading to global anomie, dysnomie, and, ultimately, economic misconduct. They do so by activating the criminogenic potential of economic, political, legal, and cultural asymmetries, as well as by creating new such asymmetries (Passas, 1999). These asymmetries cause crime by furnishing opportunities for misconduct, by generating motives for actors to take advantage of such opportunities, and by weakening social controls. More specifically, means-ends disjunctions are systematically created, as neoliberal policies foster new needs and desires that are all too often left unfulfilled. Promises of more freedom, prosperity, and happiness for a larger number of people have turned out to be chimerical. Economic and power inequalities have widened within and across countries in the last two decades . The number of poor has reached unprecedented levels, while welfare programs and safety nets are reduced or abolished. Enormous populations have become more vulnerable to exploitation, criminal victimization, and recruitment in illicit enterprises or rebel and fundamentalist groups. Normative standards and control mechanisms are weak or completely absent exactly when they are needed the most.

This article begins with some basic conceptual clarifications and outlines the theoretical framework so far applied to the analysis of U.S. organizational and individual deviance. Then, the main features of globalization and neoliberalism are presented, followed by a contrast of promises made by proponents of neoliberal policies and their actual consequences. Attention then shifts to specific criminogenic effects of these outcomes and the case of Russia, which illustrates the different stages in the processes leading up to serious misconduct and anomie. The chief policy implication of this analysis is that the recently unleashed forces of neoliberalism need to be reined in and held in check, while government policies ought to better shield the least privileged from the adverse effects of globalization.

Some Conceptual Clarifications

Although there is no universally accepted definition of transnational crime, many commentators seem to think of it as a globalized form of the stereotypical "organized crime." This, however, leaves out corporate and governmental crimes, whose effects can be far more harmful than those of "professional" criminals and ethnic groups involved in the business of illegal goods and services. We therefore need a definition that is inclusive enough without becoming too relativistic and subjective. For our purposes, transnational crime refers to cross-border misconduct that entails avoidable and unnecessary harm to society, is serious enough to warrant state intervention, and is similar to other kinds of acts criminalized in the countries concerned or by international law. Crime will be viewed as transnational when the offenders or victims are located in or operate through more than one country (Passas, 1999).

Globalization is another term that is often used without clear definition. In the simplest sense, it refers to a growing interconnectedness and multilateral linkages across national borders. According to Keohane and Nye (2000: 104), globalism is a state of the world involving networks of interdependence at multicontinental distances. The linkages occur through flows and influences of capital and goods, information and ideas, and people and forces, as well as environmentally and biologically relevant substances (such as acid rain or pathogens).

Globalism has several dimensions, such as economic, cultural, environmental, or military, not all of which take place at the same time. So, whenever globalism increases and becomes thicker or more intense, we can speak of globalization. When globalism decreases, we can speak of de-globalization.

Finally, the term "criminogenic asymmetries" refers to structural discrepancies and inequalities in the realms of the economy, law, politics, and culture. Such asymmetries are produced in the course of interactions between unequal actors (individual or organizational) or systems with distinctive features. All asymmetries contain some criminogenic potential. Durkheim argued that crime cannot be eliminated, because we are and always will be different from each other. Even in a society of saints, minor deviations would be considered serious offenses. In modern societies, crimes are those behavioral differences (asymmetries) that have been outlawed by legislative bodies. There is always the opportunity for powerful actors to victimize less privileged ones (economic, political, and power asymmetries). This potential is not always materialized. Criminal opportunities are not necessarily taken advantage of. Mostly this is because actors do not always seek or wish to make use of illegal opportunities. They may not regard such action as appropriate (due to socialization, internalization of norms) or fear adverse consequences. The criminogenic potential is most likely to be activated when opportunities, motives, and weak controls are all present.

For example, a combination of legal/regulatory asymmetries with economic and political asymmetries has given rise to a huge illicit market for toxic waste disposal. Many Third World countries either did not regulate toxic waste or did so much less rigorously than did industrialized states. This provided an opportunity for maximum-profit-seeking companies to getrid of their hazardous waste in areas where rules were lax or nonexistent (Center for Investigative Reporting and Moyers, 1990; Critharis, 1990). Power and economic asymmetries between rich and poor countries have led waste recipients to allow this to go on because of their dependence on foreign investment, the need for cash to service external debt, or the desire to create jobs (Korten, 1995). Economic and knowledge asymmetries also shaped the motivation of local participants in this questionable trade. The decision to go along reflects an incomplete understanding of the extent or nature of the hazard, their desperate need for additional income, an effort to be competitive and attractive to foreign companies (race to the bottom), or corruption.

Anomie and Deviance

Both Durkheim (1983) and Merton (1968) have stressed how high rates of deviance should be expected when social expectations are out of balance with realistic opportunities to reach the desired goals. According to Durkheim, this means-ends discrepancy is caused by society's inability to regulate people's naturally limitless desires. This problem was particularly acute in the commercial and business sector, in which anomie was chronic during the industrial revolution, opening up new horizons and undermining society's ability to contain aspirations. A similar situation can be observed in contemporary societies, where electronic, information, and biological technologies constantly redefine what is possible and break new ground.

According to Merton, unrealistic hopes and expectations are not simply natural, but socially constructed and promoted. Structural problems are at the heart of the means-ends disjunction. The U.S. culture and the ideology of the American Dream encourage lofty expectations, while society fails to provide equal access to legal opportunities. Meanwhile, there is a cultural overemphasis on success goals at the expense of normative behavior (as further elaborated by Messner and Rosenfeld, 1994). Both of these factors make for deviance and anomie.

Without ignoring the differences between the two sociologists, it has been possible to use an elaborated version of their anomie theories to explain corporate crime in the context of capitalist economies (Passas, 1990). Regardless of whether people strive for "more" due to natural drives or because of cultural encouragement, the point is that market economies cannot perform without lofty aspirations, consumerism, emphasis on material/monetary goals, and competition. All this leads to the pursuit of constantly moving targets and systematic sources of frustration. A synthesis of anomie theory with reference group analysis made clear how means-ends discrepancies are socially generated and experienced by people in all social strata. It also showed how this theoretical framework is applicable to the analysis of crime without strain or problems (i.e., anomie theory is not a strain theory) and to "organized crime" even after discrimination or blockage of legitimate opportunities no longer affects minority groups (Passas, 1997).

In brief, the dynamic social process leading to structurally induced strain, anomie, and deviance without strain is as follows. Means-ends discrepancies are caused by a strong cultural emphasis on monetary or material success goals for all members of society, while a good number of them do not have a realistic chance to attain them. Socially distant comparative referents are constantly introduced and sustained through the school, family, politics, workplace, media, advertising, and even religion (Passas, 1994). Regardless of their social background and the social capital available to them, people are urged to desire more than they have. Success stories of going from rags to riches make the American Dream even more believable. As this cultural theme is internalized, competitive forces and consumerism foster normative referents on what is "normal" and appropriate. The widely internalized egalitarian discourse clashes in practice with widespread inequality (power and economic asymmetries). Consequently, those m embers who fail to meet such comparative and normative standards are likely to experience relative deprivation and frustration. This strain, combined with the culturally induced overemphasis on goals and the concomitant under-emphasis on the proper methods, makes for deviance of various types (see Merton's typology). A good part of the deviance is an individual search for a solution to these structural problems. If the deviant solution is successful (i.e., perpetrators are not caught or adequately punished), this adaptation may become normative for others in a similar social context. To the extent that this solution is available to them (demand for illicit goods or services, access to illegitimate opportunity structures), they may adopt this role model -- and may be expected by their significant others to follow this path -- even though the original source of strain has by now been eclipsed. Unless effective control measures are taken, this process continues in a vicious circle toward higher rates of deviance and widespread anomie (for a schematic representation of this process, see Figure 1 at the end of the article).

In the literature, anomie is often conceptually confused with its causes or effects. To keep its explanatory potential, this mistake should be avoided. Anomie is a withdrawal of allegiance from conventional norms and a weakening of these norms' guiding power on behavior. This is caused by structural contradictions and affects deviance in two ways. One is associated with strain, the other is not. The former is caused by relative deprivation, frustrations, and the almost obsessive focus on goals. This makes deviance thinkable, as conventional norms are regarded as nonbinding, at least temporarily. Rationalizations enable departures from otherwise accepted/internalized social rules, as actors convince themselves that in their particular circumstances an exception is acceptable (Aubert, 1968; Sykes and Matza, 1957). Through interactive processes, techniques of neutralization and rationalizations contribute to a context in which newly socialized actors may adopt normative referents and deviant behavior as a matter of course. If "this is the way business is done around here," people may engage in price fixing or misleading advertising without experiencing any prior frustration or problem.

Globalization and Neoliberalism

These structural problems have been most prominent in the USA. However, a very similar process is now being reproduced throughout the world through globalism and neoliberalism. Promises are made that are not fulfilled. People's expectations are exalted at a time when economic and power asymmetries increase and become less justifiable and intolerable in the eyes of the people affected. The logic of the market permeates popular thinking and introduces rationalizations, making the adoption of a criminal or unethical solution more acceptable. The horizontal lines in Figure 1, rather than representing controlling influences, at the global level point to the criminogenic impact of globalization and neoliberal policies.

Nowadays, globalism and neoliberalism seem to be indistinguishable empirically or even conceptually (Cox, 1993; Stewart and Berry, 1999). Nevertheless, I think it is useful to try to separate them analytically. As noted earlier, globalism refers to the degree of interconnectedness and the increase or decrease of linkages. By contrast, neoliberalism refers to an economic and political school of thought on the relations between the state on the one hand, and citizens and the world of trade and commerce on the other. Because it espouses minimal or no state interference in the market and promotes the lifting of barriers to trade and business transactions across regional and national borders, it certainly becomes a motor of globalization.

Globalization in the last two decades shows clear signs of deeper and thicker interconnections that affect many more people than ever before. The effects are now much faster, as shown by the financial crisis in Thailand in 1997. The world has shrunk and become "one place," with global communications and media, transnational corporations, supranational institutions, and integrated markets and financial systems that trade around the clock (McGrew, 1992; Sklair, 1995). The cultural landscape has changed under the influence of mass media. Through their ads, TV programs, movies, and music, they contribute to cultural globalism, target young children, and foster consumerism (e.g., "Image Is Everything," "Just Do It," or "Coke Is It"). Information technology is making for "distant encounters and instant connections" (Yergin and Stanislaw, 1998). Fresh normative and comparative ideals are thus promoted, legitimated, and presented as attainable. Scholars attribute the momentum of this process to the forces of capitalism (Wallerstein, 1983), technology (Rosenau, 1990), the presence of a hegemon (Gilpin, 1987), or a combination of them all (Giddens, 1990).

Neoliberalism, in particular, has made a major contribution to the dynamic and contradictory processes of globalization since the elections of Ronald Reagan, Margaret Thatcher, and Helmut Kohl. During the 1950s and 1960s, the dominant concerns revolved around distributive justice, neocolonialism, and dependency theory. These were displaced in the 1980s and into the 1990s by discourses of "free markets," individualism, and self-help (Woods, 1999). Policies of deregulation, privatization of state assets, and removal of tariffs implemented the doctrine that the state should get out of the way of free enterprise. Unemployment, inequality, and poverty were no longer explained by structural contradictions or constraints. The problems became individualized and blamed on corrupt administrations or on the poor themselves. The proposed medicine was more liberalization of the economy, free competition, privatization of inefficiently managed government agencies, abolition of capital controls, and permitting foreign capital to enter all markets.

The ideological underpinning of globalization, thus, has been the primacy of economic growth, which is thought to be benefiting the whole planet. Consistent with that prime directive, country after country has been persuaded (or forced) to promote "free trade" and consumerism, to reduce government regulation of business, and to adopt the same economic model regardless of local specificities and differences between industrialized and developing countries (Bello, 1999; Mander, 1996).

More specifically, shifts in the North, the East, and the South have been quite remarkable. In the North, the welfare state that used to care for citizens "from cradle to grave" has been replaced by a "pay as you go" social service system. Even public utilities have been privatized and have begun to charge "economic prices," as former subsidization systems were abolished. Further, "industrial interventionism and labour protection have given way to laissez-faire; and tax systems whose major purpose was to correct inequalities have been transformed into systems mainly intended to promote incentives and economic efficiency" (Stewart and Berry, 1999: 151).

In developing countries, similar shifts took place as a result of hegemonic influences from the North. Western-educated Third World "technocrats" returned to their home countries eager to introduce neoliberal policies (Burbach et al., 1997: 86; Newsweek, June 15, 1992). As the bandwagon of liberalization took off, few countries wished to be left out. As a World Bank official warned, "lagging countries risk being left farther behind....For economies that remain inward-looking, the risk of being marginalized is greater than ever" (cited in Klak, 1998: 21).

Yet, the shifts have not always been voluntary. A host of measures and conditions consistent with the neoliberal agenda were imposed on countries through international institutions, such as the International Monetary Fund (IMF), the World Bank, the OECD, the European Union, the G7, etc. Countries drowning in external debt sought additional loans to pay off their older ones -- chiefly to banks from the industrialized world. Billions of dollars were made available to them, but only if they introduced Structural Adjustment Programs (SAPs). Despite important differences among the various economies, SAPs shared the same basic elements: long-term "structural" reforms to deregulate the economy, liberalization of trade, removal of restrictions on foreign investment, promotion of an export orientation of the economy, wage reductions and controls, privatization of state enterprises, and short-term stabilization measures such as cutbacks in government spending, high interest rates, and currency devaluation (Bello, 1996 ; 1999).

Changes along these lines also took place in the East, where the switch from state-managed economies toward "free market" and parliamentary democracy has been quite drastic and swift (Glinkina, 1994; Woods, 1999). The problem is that the introduction of global neoliberalism has brought about enormous economic and political asymmetries, as its promises and theoretical expectations remain unfulfilled.

The Promises of Global Neoliberalism

The supporters of global neoliberalism make a series of claims. For instance, the world is shrinking following greater connectivity (IBM claims to offer "solutions for a smaller planet"). The distinction between core and periphery states is presumed to be getting fuzzier and irrelevant, as there are only winners from now on. Investment, trade, and development opportunities are more widely distributed around the world. There is a marked convergence into one world economy, in which everyone can find a market niche. Media and cultural influences are more widespread and multilateral, as foods, music, and art are imported to the North and integrated into local cultures. Finally, people are more integrated thanks to telecommunication technologies and immigration (Klak, 1998).

To [neoliberal] economists, all these trends are positive, even if short-term hardship is deemed necessary for some parts of the population. Global welfare is expected to be enhanced, as the forces of free competition within and between countries will encourage more efficient resource allocation and bring about higher productivity (Oman, 1999). A more open, trade-creating world should, therefore, benefit everyone, if unevenly. Trickle-down effects of wealth creation would ensure that virtually everyone will participate in this welcome trend (Korten, 1996).

The objective of SAPs was to render developing economies more efficient, drive up growth rates, and provide foreign exchange that could be used to repay debt. Higher growth rates are empirically associated with comparatively more equal income distribution (Alesina and Rodrik, 1994). Hence, neoliberal policies would bring about not only more economic growth, productivity, a better division of labor (multistate production and wider participation), lower unemployment, more wealth and prosperity, but also more democracy, less poverty, and fewer inequalities. Unfortunately, in most countries, these virtuous circles did not occur.

The Consequences of Global Neoliberalism

Throughout the world, the expectations raised by neoliberal theorists have not materialized despite the extensive application of their policy recommendations. Instead, most economies "fell into a hole" of low investment, decreased social spending and consumption, low output, decline and stagnation. Both the World Bank and the IMF retreated from SAPs and acknowledged their failure (Bello, 1999; Katona, 1999; Multinational Monitor, June 2000; Watkins, 1997).

In the North, GDP growth was lower in the 1980 to 1990 period than in the 1950s and 1960s. We also witness a higher volatility in growth (e.g., booms and busts). Lost in all the talk about huge technological advances ushering in the computer and Internet era is the fact that productivity growth now is half that of levels in the 1950s and 1960s. Unemployment in OECD (Organization for Economic Cooperation and Development) countries has risen from eight million in 1970 to 35 million in 1994. In the midst of U.S. prosperity and economic expansion, inequalities increased. The number of people living under the officially defined poverty level grew from 11.4% of the population in 1978 to 13.5% in 1990. Almost one in four new babies in the U.S. are born into poverty, while the top one percent of Americans saw their real income shoot up by 50% (Levy, 1998; Wilterdink, 1995). Also noteworthy is that U.S. and Western European international trade relative to GDP was greater a century ago than in recent years (Hirst and Thompson, 1996).

Neoliberal dreams proved to be even more chimerical in the South. Role models, like South Korea, Malaysia, and Indonesia plunged into crises in the 1990s. Mexico and Brazil, which faced their own scary periods, experienced growth of three percent in the last two decades, whereas that rate was six percent during the dirigiste period of 1950 to 1980. Wage gaps widened. Even in Costa Rica and Chile, models of success in Latin America, the results have been an unmitigated disaster for the lower social classes. The number of Costa Ricans below the poverty line rose from 18.6% in 1987 to 24.4% in 1991, while 42% of all Chileans are also living in poverty (Burbach et al., 1997: 86). Half of the investment flows to developing countries went to just three countries (China, Mexico, and Argentina). In addition, some investments had negative local effects. For instance, as diverse agriculture was converted into monocultures or to export-oriented flower plantations, self-sufficiency was undermined (Clinard, 1990; Klak, 1 998).

Moreover, the core-periphery distinction is as relevant as ever. Its real meaning relates to power, authority, and the accumulation of wealth, where the gaps (asymmetries) are increasing. Although production (of certain items) is more dispersed, the concentration of power, control, and benefits has become more pronounced. In 1991, 81% of the world stock of direct foreign investment was in the core triad of the USA, the European Union, and Japan -- up from 69% in 1967. The appearance of integrated markets also obscures the fact that 80% of all world trade is within the core triad, in which resides less than 20% of the planet's population (Hirst and Thompson, 1996; Klak, 1998).

In Latin America, debt jumped from $230 billion in 1980 to $600 billion in 1997. Capital had been fleeing those countries up to the early 1990s, when net inflows were the result of casino capital -- seeking short-term gains and likely to abandon those countries at the first hint of trouble. Consequently, new debts were created with a new round of borrowing (Robinson, 1998-1999). An important reason why developing countries cannot pay off their debt is that trade protectionism in the North has kept them from penetrating those markets. Trade liberalization has been inconsistent in that rich countries demand more open markets abroad, while continuing to subsidize their own economic sectors, such as agriculture (Andreas, 1999; UNDP, 2000; Watkins, 1997). Compounding these problems, aid to poor countries has been cut back. Whatever assistance is offered comes with strings attached, including the reduction of state intervention, which could have softened the effects for the most vulnerable (Watkins, 1997; Woods, 1 999). These policies further undercut food security, cause poverty, and increase economic and power asymmetries. For instance, the cost of living in the Caribbean and the U.S. is quite comparable. In 1997, however, per capita income in Trinidad and Tobago, the richest Caribbean state, was less than half that of Mississippi, the poorest U.S. state. The gap between skilled and unskilled workers widened even more: Haitian workers made clothing with Disney logos for less than 60 cents per hour, while Disney's CEO made $9,700 per hour (Klak, 1998).

The claim of multilateral and even cultural influences also masks tremendous asymmetries. Even though we listen to reggae in the North, 95% of TV programs in St. Lucia come from the U.S. The most widely read newspaper in the Caribbean is the Miami Herald. Consequently, U.S. affluence and opportunity, often romanticized, is especially well-known, deeply ingrained, and alluring to the Caribbean...[where] people are prone to set their living standard goals in accordance with what the U.S. media ascribe to the United States. And the imbalance in media flows is increasing with the Caribbean's economic crisis and neoliberalism, as local media have been slashed (Klak, 1998: 11).

As dreams of consumption are disseminated, 86% of total private consumption expenditures is accounted for by 20% of the world's people in industrialized countries (UNDP, 1998). For the people who live outside the consumption geographical area, big banks offer credit to only 10% of the people in developing countries, whereas ads for credit cards and consumer items are omnipresent (Barnet and Cavanagh, 1994). Well over one billion people are deprived of basic consumption needs. For hundreds of millions, basic sanitation, clean water, adequate housing, and health services are unattainable luxuries. Two billion people live on less than two dollars a day and 1.3 billion on less than one dollar a day (ICFTU, 2000). Struggling to survive, some decide to sell their body parts to make ends meet, which is the ultimate symbol of commodification (ScheperHughes, 2000).

A negative effect of the Internet is that it alters the relationship between our place of residence and our cultural preferences, experiences, and identities. A spreading global virtual reality disconnects locality from culture, weakens the bonds to particular communities, and estranges people from each other (Minda, 2000). Ladakh, a Himalayan province that prospered for a millennium despite harsh weather conditions, illustrates how (especially cultural) globalization devastated local communities (Norberg-Hodge, 1996). In 1962, isolated Ladakh was linked to the rest of India by an army-built road. The modernization that began in 1975 took about a decade to change the pride Ladakhis felt until then into a collective inferiority complex. Tourism and the media conveyed a picture of wealth, technology, power, and work that was alien and irresistible to them. Village life by comparison began to appear "primitive, silly, and inefficient" (Ibid.: 35). Ladakhis felt ashamed of their culture and strove for consumer items that symbolize modern life, such as sunglasses and Walkinans. As Western educational standards penetrated Ladakh, the intergenerational learning experience that helped them provide for themselves in their rough terrain gave way to schools that used texts imitating Indian and British models that were completely irrelevant to their lives (e.g., figuring out the angle of the Tower of Pisa and learning how to keep a London-like bedroom tidy). There used to be no such thing as a "paying job"; there was no money economy. Gradually, however, unemployment -- previously nonexistent -- became a serious problem, because naturally available resources were abandoned, cheap imports made local farming redundant, and people flocked to the cities to compete for scarce jobs. Radios and TVs chased away the traditions of singing together and group story telling. The points of reference ceased to be real people living nearby, but geographically and socially remote ideals. Consumerism bred new "needs," which could hardly be materialized. Family and other bonds disintegrated and divisions emerged between old and young, Buddhists and Muslims. The result was unprecedented violence, community breakdown, and anomie.

Criminogenic Effects: Systemic Strains and Global Anomie

What makes the ideology of the American Dream unique is a focus on money and material goods, a strong emphasis on "winning" (often, by all means), and success for everyone in a society where many opportunities for material advancement are available and plenty of "rags to riches" stories lend legitimacy and credibility to the egalitarian discourse. Legal opportunities, however, for achieving the lofty goals are inaccessible to most Americans. In such a consumption-driven culture, which highly values competition and individualism, the means-ends disjunction has entailed a significant criminogenic risk, much greater than in the rest of the world. Crime has been the flip side of economic growth, innovation, and better living standards for certain segments of the population. What sheltered other countries from this negative potential were things absent or minimized in the USA, such as rigid social stratification, low rates of social mobility, less materialism and time spent before TV boxes, safety nets for the underprivileged, more emphasis on other priorities (e.g., solidarity), etc.

This made it possible to explain the higher crime rates in the U.S. compared to other developed or developing countries. These protective factors, however, are now being gradually lost. Disjunctions between socially induced goals and legal means are few in societies that do not encourage high social mobility. In such societies, people may not feel that they are lacking anything, even when they are "objectively" deprived. Economic or other asymmetries are unknown or not experienced and perceived as intolerable. Global neoliberalism breaks down societal barriers and encourages new needs, desires, and fashions. It promotes the adoption of non-membership reference groups for comparisons that can be unfavorable and upsetting. New normative reference groups define what is "cool" to do. People's ideals in the South and the East may not be about getting from "a log cabin to the White House." However, they are being systematically driven to abandon old ways and values in order to consume. They do not necessarily think that they can be "like Mike," but they do fancy those pricey athletic shoes. So, fresh normative and comparative models create new "needs," together with the expectation that the fulfillment of such needs is vital and achievable.

Yet, as needs and normative models are "harmonized," people become conscious of economic and power asymmetries, and directly experience their impact. Globalization and neoliberalism heightened this awareness, further widened the asymmetries, and fostered the interpretation of them as unnecessary and changeable. In the end, most people realize that the attainment of their lofty goals and lifestyles is beyond reach, if they are to use legitimate means. The success in spreading neoliberalism has brought about a series of failures: more poverty, bigger economic asymmetries, ecosystem deterioration, slower and unsustainable growth patterns. At the time that societies most needed the shield of the state to cushion these effects, welfare programs, safety nets, and other assistance to the poor (individuals, companies, and states alike) forcibly declined or disappeared. Thus, global neoliberalism systematically causes relative deprivation as well as absolute immiseration of masses of people. In effect, it has generated new sources of criminogenesis and removed existing antidotes to it.

All this provides multiple motivations for criminality, as many would turn left and right for solutions and illicit opportunity structures become more international and accessible. At the same time, many weak states lose their autonomy, come to depend more on international organizations and transnational capital, and are unable to cope with emerging crime threats from criminal enterprises and powerful corporations. So, globalism and neoliberalism replace the "egalitarian discourse" of the American Dream in the scheme represented in Figure 1 in a process occurring in the industrialized world, developing countries, and those in transition from Communism to market democracies. Nowhere are these results more clearly visible than in the former USSR.

The Case of Russia

No one argues that there was no appetite for consumer goods in the years of the USSR or that such goods were widely available. Crime, corruption, illegal markets, and even underground factories could be found behind the official facade of the command system before glasnost and perestroika, although black marketers were not numerous and lived modestly. The government turned a blind eye to these activities, because they served as a safety valve in an inefficient system (Gleason, 1990; Handelman, 1995; Naylor, 1999b). Discontent, enormous structural problems, and an inability to deal with them characterized the pre-transition years. This is particularly true for the 1960s, when Khrushchev pledged that the USSR would overtake the U.S. in the production of industrial goods by the 1980s. Yet, as inefficiencies precluded such progress, demands for more consumer items "from an increasingly educated, by now self-assured, population, started to put pressure on government...as a loyal expression of the citizens' request for the gradual delivery of promised well-being" (Castells. 2000: 25).

In the 1990s, however, the rates of fraud, prostitution, drug trafficking and abuse, alcoholism, smuggling, white-collar crime, violence, and corruption skyrocketed (Castells, 2000; Handelman, 1995; Holmes, 1997; Lee, 1994; Shelley, 1994). To be sure, Russia is unique in the degree of chaos and disintegration that accompanied the transition to a market economy and the implementation of neoliberal reforms. Few countries have experienced the speed and intensity of privatization, deregulation, and the lack of political leadership and administrative skills we witness in Russia. Indeed, it is the closest we can come to a social state of anomie, without a total collapse and anarchy. This does not mean that Russia is atypical. Very similar, albeit less intense, processes have occurred throughout the world (Lee, 1999; Mander and Goldsmith, 1996; van Duyne et al., 2000). Nevertheless, precisely because it is such an extreme case, it illustrates the theoretical points made here and the process toward anomie and economc crime.

Enter Neoliberalism

In the 1985 to 1989 period, reforms took place while the Communist Party was still in control. The Law on Cooperatives (1986) and the Law on Individual Labor Activity (1987) paved the way for further reforms, such as legalization of small businesses in 1989. Between 1990 and 1991, the USSR Supreme Soviet, with Yeltsin as chairman, introduced laws that made state and private enterprises equal, allowed state companies relative independence from government managers, abolished mostrestrictions on property bought by citizens, promoted privatization, and allowed foreign companies to operate in Russia. Such reforms did not take place at the same pace throughout the USSR. This set Russia apart from the Union and Yeltsin from Gorbachev. Legal asymmetries made the task of law enforcers impossible, as they did not know which laws to prioritize and apply (Afanasyef, 1994). Up to the 1991 coup and the collapse of the USSR, reforms were cautious and gradual, and had not challenged the core of the command economy system. F ollowing the failed coup and under Yeltsin, however, this changed dramatically. Demagogy and erroneous judgments on the feasibility of a swift transition to a market democracy compounded the problem. The Russian government was warned of the dire consequences of a speedy transition to a market economy without previous establishment of the necessary institutions and legal infrastructure. The chairman of an international advisory committee, which repeatedly issued warnings in 1992, was told that "forces in the Kremlin" favored a less "regulatory approach that would provide greater freedom of manoeuvre. Gaidar, supported by the IMF, believed firmly in the intrinsic capacity of market forces to remove obstacles by themselves, and people could use their vouchers to acquire shares" (Castells, 2000:188). Prices were liberalized, imports and exports became free, domestic trade restrictions were abolished, government intervention was minimized, and public property was massively privatized. By June 1994, officials were self-congratulatory over the fact that 70% of state assets had passed into private hands (Kuznetsova, 1994).

New Normative and Comparative Referents

The reforms initiated by Andropov and Gorbachev (perestroika and glasnost) allowed some freedom of speech and openness that let globalization and media influences into the USSR. The post-1991 changes, however, offered new hope out of the severe problems people were facing. Russian leaders fostered heightened aspirations by declaring that the country would soon be modernized and join the "civilized world." Authorities in the former Soviet republics made the same promise, arguing that '"since we gotrid of the Russians,' all obstacles to prosperity have been removed and Western standards are within reach" (Burbach et al., 1997: 118). There were forceful and impressive presentations of consumerist lifestyles as "desirable," "modern," and feasible. Distant comparative and normative referents were thus promoted by the media and advertising. Indeed, the yearning for Western lifestyles and consumption items made the initial acceptance of neoliberalism by the population much easier (Ibid.). Neoliberalism strengthened that desire and made consumerist dreams appear realistic. Even young Russians now would like to be like Mike and wear the same type of shoes or eat the same breakfast. As Glinkina (1994: 385) put it, an important factor contributing to the criminalization of the economy has been "a drastic stratification of the population's standard of living with a simultaneous loss, in a considerable part (especially among the youth), of socially important goals --replacing them with consumption ideals...."

It must be noted that the normative shift was far more radical in the former USSR and Eastern Europe than it was in Third World countries. The transition from socialism to capitalism by overzealous authorities espousing the new dogma of neoliberalism has had its own direct anomic effects, as will be seen below.

The Consequence: Means-Ends Discrepancies

The worldwide consequences of neoliberal policies were replicated in Russia. However, the effects have been far more disastrous than elsewhere: lower productivity, high unemployment, much steeper inequalities, increased levels of absolute poverty, disappearance of familiar safety nets, and administrations paralyzed by ineptness and corruption. The ensuing means-ends discrepancies are far more than a theoretical construct. They are painfully experienced by large numbers of people who realize that they simply cannot attain their goals. Within one year, inflation wiped outmost people's life savings, while the buying power of most wages dropped to the level of the 1950s. In the winter of 1993, funds were often insufficient to heat residential buildings (Burbach et al., 1997; Handelman, 1993).

As a new bourgeoisie emerged from the ashes of the Communist regime, one-third of the population became impoverished. The gap between the rich and the poor opened up suddenly and grew out of proportion. Official data indicate that in 1994 the difference between them was elevenfold. Researchers argue that the difference between the top 10% and the bottom 10% is 28-fold (Kuznetsova, 1994). Even the chair of the Privatization Commission admitted that the process created "pauper-proprietors" who "cannot survive without state protection" (cited in Burbach et al., 1997: 120).

Relative and Absolute Deprivation

The rising expectations of the 1960s led to disenchantment with Communism and paved the way for radical social change. The abandonment of the Soviet conservative model and very rapid implementation of neoliberal policies fueled hopes that a much better future was within reach. Russians rejected rigid stratification and strove for a socially mobile ideal. As has been noted, [the middle classes] believed that capitalism could offer even more. Thus, the modernization that had been promised by the neoliberals was perceived by the majority of the population as the modernization of consumption.... The Western model of consumption has finally triumphed, at least in the main cities. But for the majority of the people, the price is that even the former Soviet way of life has become an unattainable dream (Burbach et al., 1997: 124).

The aspiring yuppies have ended up as "dumpies," while a growing polarization makes them see a few of their compatriots enjoy luxuries attained by looting the remnants of the former USSR.

Thus, the post-Soviet Russian dream turned out to be a nasty nightmare (Handelman, 1995). As happened in many other countries, austerity, belt tightening, and lower (in some cases, no) salaries were imposed as consumerism took hold. The impact of these experiences on personal feelings is much more widespread, intense, and unpleasant due to the higher expectations. Even people who are not objectively deprived now feel relatively deprived. Comparisons between their present and past situations are unfavorable: "Formerly privileged sections of the Russian population, such as teachers, doctors, miners, and workers in the oil and gas industry, went on strike, for they could no longer survive on 50 to 70 dollars per month salaries" (Burbach et al., 1997: 125-126).

East-West political and administrative asymmetries, economic asymmetries, and relative deprivation in the aftermath of the collapse of the USSR and disillusionment with Western policies and capitalism have been clearly criminogenic (Handelman, 1994; Shelley, 1994). Motives for various types of crime became abundant, illegal opportunity structures multiplied, and control systems have been seriously damaged and undermined. The Mertonian category of "conformity" has almost become a rarity, as crime rates increased sharply. Even worse is the problem of economic crime. Recorded economic crimes rose almost 23% during the first seven months of 2000, compared with the same period in 1999 (Radio Free Europe/Radio Liberty, August 17, 2000). Strains and discontent have translated into a range of predatory misconduct, corruption, political violence, a variety of illegal markets, and expressive misconduct.

Search for Solutions and Anomie

In this context, many can be expected to "innovate," to employ illegal methods for survival or the satisfaction of their basic and newly acquired needs. Methods range from petty property crimes and prostitution to criminal enterprises and white-collar crime, depending on the social position of the offender. An electronics engineer, for example, could not live on his three dollars per month and moonlighted as a taxi driver. When his taxi broke down, he turned to selling poppy straw (OGD, 1996). Unpaid and depressed professionals with access to more valuable commodities, such as nuclear material, pose an even more serious threat (Lee, 1999). Consumerist teasing increased demand for goods made unavailable (e.g., cars or electronics) by the economic collapse, fueling smuggling operations, black market networks, and associated illegal enterprises. Shortages of other desired goods are artificially created by quickly adapting entrepreneurs.

Similar conditions outside Russia explain the illegal car trade between Eastern and Western Europe (van Duyne et al., 2000) and the illegal trade in various commodities between China and Hong Kong before unification (Vagg, 1992). In Russia, many took advantage of such supply-demand asymmetries, including the vory v zakonye (commonly described as "thieves in law"), who had been the dominant type of professional offenders in the USSR. Structural changes and globalization, however, brought about more competition from ethnic groups (Armenians, Azeris, Chechens, Georgians, etc.) in drugs and arms trafficking, as well as from loose and ad hoc associations of criminals in certain locations or industries. Unsettling reports assert a symbiotic relationship between criminal groups and active or retired intelligence officials. Deteriorating economic conditions have facilitated recruitment for employees in growing illegal markets. Criminal enterprises, for instance, have "...invested heavily in the opium business, financing much of the new cultivation by hiring peasants and even entire villages to plant and protect the poppy crops" (Lee, 1994: 401).

Another source of criminal opportunities sprang from the disintegration of institutions and the disarray in law enforcement. Legitimate businesses are exposed to blackmail and other criminal victimization, but the authorities are unable to assist them. Consequently, many domestic and foreign companies deal with criminal groups and seek their protection, rather than rely on the government (Lee, 1994). Not surprisingly, the majority of Russian experts consider the strengthening of criminal groups to be a "very significant" social consequence of the market reforms introduced in 1992 (Afanasyef, 1994).

Other illicit opportunities were furnished by the privatization process, such as selling state assets at extremely low prices or driving down the prices of privatized companies so as to cheaply purchase vouchers owned by individuals desperate to make ends meet. Privatization in countries with an existing bourgeoisie and experienced managers and entrepreneurs facilitated certain corporate crimes and abuses of power by respected professionals. In Russia, the mix of offenders was different: former company directors, the nomenklatura, professional criminals, and new entrepreneurs with a black market background (Glinkina, 1994; Kuznetsova, 1994; Shelley, 1994). The attempt of former Communist officials to dominate this field did not prove lasting. Many were not competent to run private businesses and had to sell them or lose control. The main beneficiaries seem to be former black marketers and outsiders to the old order (Naylor, 1999b). The abuse of privatization has had an anomic effect as the impunity of offenders became widely known, to the point that Russians began to refer to privatization (privatizatsiya) as prikhvatizatsiya, which means "grabbing" (Handelman, 1995: 104).

Crime and corruption in the midst of privatization fervor are not unique to Russia. (On other previously Communist states, see Popescu-Birlan, 1994; on Latin America, see Saba and Manzetti, 1996-1997.) As a former World Bank official put it, "everything we did from 1983 onward was based upon our new sense of mission to have the south privatized or die; towards this end we ignominiously created economic bedlam in Latin America and Africa" (cited in Katona, 1999). Another similarity with other parts of the world is the degree of authoritarianism that accompanied neoliberal policies. While stimulating rapid accumulation of private capital, the role of the state is reduced to implementing financial austerity. When people started to oppose such measures, "Yeltsin resorted, with Western support, to establishing a semi-authoritarian regime. Making Russian 'reformers' invincible to political and legal challenges inside the country contributed to further criminalization of the Russian State, which acquired an oligarchic character" (Beare, 2000:6). As similar processes occurred around the world, from Pinochet's Chile to Suharto's Indonesia, one wonders if such reforms would have been possible in a democracy.

Legal organizations also "innovate" by cutting corners and breaking the law due to the environment created by unsystematic legal reforms. Unable to navigate a sea of legal gaps and inconsistencies, "...most managers of private as well as state-owned enterprises cannot run their businesses without committing crimes" (Afanasyef, 1994: 437). Many companies cannot handle the competitive challenges generated by globalism and require state protection. The subsidization of privatized companies, however, introduces further regulatory and price asymmetries that foster the smuggling of goods across newly created borders within the former USSR (see below on nonferrous materials). Enterprises that do not enjoy state intervention are at a disadvantage and may be forced into bankruptcy or crime as a last resort. This is analogous to the situation in all countries that abolish trade barriers, let transnational corporations in, and eliminate preferential treatment for domestic industries.

High-level corruption and banking crimes have become quite common, as the networks of mobsters, financiers, businessmen, and high-level officials extend beyond Eurasia (Beare, 2000). The ongoing investigations into billions of dollars (possibly IMF-provided funds) laundered through the Bank of New York have expanded to include British, Swiss, and Italian entities and actors.

Moreover, pyramid schemes and other frauds have devastated gullible investors, as is the case with other post-Communist countries. Independent Oil, Lenin Trade and Financial Corporation, Aldzher (a security corporation), and other companies defrauded more than a million depositors and investors. Just as the Lincoln Savings and Loan frauds were committed in midst of obsessive deregulation in the U.S. against "the weak, the meek, and the old," Russian pensioners have been the main fraud victims (Glinkina, 1994).

Economic asymmetries among countries produce another set of criminal opportunities, as many become strongly motivated to flee the problem and search for a better future in the West, where the "goodies" are available. However, neoliberalism has promoted the free movement of everything but labor. Quotas and restrictions in promised lands generate demand for illegal services such as the smuggling of humans (Chin, 1999). This leads to opportunities for criminal exploitation, corruption, child/cheap labor, slavery, and forced prostitution.

Women, who are increasingly breadwinners but make up two-thirds of the newly unemployed in Russia, are even more vulnerable in this respect. Economic desperation drives many of them to prostitution or high risk taking. Lack of opportunity makes Russians and East Europeans softer targets for human traffickers. They are more likely to be lured to the West with promises of well-paying, respectable jobs only to end up blackmailed, beaten up, and forced into prostitution (Bruinsma, 1999; Shelley, 1994). The same problems faced by Thai, Mexican, and other women in the U.S. have led to a public hearing before the House Subcommittee on International Operations and Human Rights (September 14, 1999).

Relative deprivation and experience of injustice have a revolutionary potential too. International communications convey the message that injustice and inequality are avoidable. Events in one corner of the earth affect feelings and encourage people elsewhere to rebel against aggression. This may inspire change and foster rebellion. Just as the ideals of the French Revolution led to rebellions in the Balkans against the Ottoman rule (Hovannisian, 1994), the independence of the Baltic states and the U.N. response to Iraq's invasion of Kuwait inspired the East Timorese to fight against the Indonesian autocratic rule (Dunn, 1994). The uprising of Zapatistas in Mexico was deliberately started on January 1, 1994, the day NAFTA went into effect, "as a highly symbolic way to protest neoliberalism and globalisation in Mexico and Latin America" (Robinson, 1998-1999: 123-124).

Repressed nationalism, globalism, and bad times have jointly contributed to several armed conflicts and rebellions in the former USSR (the Caucasus, Moldova, Crimea, Tajikistan, and Chechnya). Rebellion and illegal markets become interconnected, as armed conflicts necessitate training, weapons, intelligence, and financing. The cases of Chechnya, Tajikistan, Afghanistan, and Colombia show how political revolts are associated with corruption, money laundering, the traffic in arms, drugs, and even nuclear material and other crimes that go unpunished (Kuznetsova, 1994: 445; Lee, 1999; Naylor, 1999b; OGD, 1996). Chechnya, which survives thanks to donations from criminal organizations based in other parts of Russia, has become such a paradise for these activities that some depict the war there as "a crusade against a 'mafia republic,'" while others think of it as "a conflict between opposing criminal elites for the control of oil and the financial resources held by the government in Grozny" (Politi, 1998: 44).

Finally, "retreatism" is the only option left to those lacking access to illegal opportunities or who are unwilling to assume the associated risks of violence and arrest. Hence, expressive crimes could be expected. More important, the rates of alcohol and drug abuse (further facilitated by the decriminalization of drug use in Russia in 1991) increased geometrically, especially in the cities, and fueled the demand for things provided in illegal markets (Lee, 1994; OGD, 1996).

Anomie

The transition from a command to a market economy practically legalized large parts of the black market and made legal business dependent on criminals' protection. The dismantling of borders and increased contact among previously isolated ethnic groups contributed to the formation of new, wider networks of illegality (Politi, 1998). The result was that one could hardly tell criminals from businessmen, particularly when some outlaw groups act on instructions from government officials or the police (Handelman, 1993). Given official efforts to ensure that the transition to a market economy would occur before substantial opposition could build and that the changes would be irreversible, too many shady actors were allowed to take advantage of this official shield (Glinkina, 1994; Naylor, 1999b). In this light, common views on government-criminal interfaces and symbiosis are plausible, although difficult to prove. Surveys in 1994 showed that the concern of Russians over organized crime was second only to their fears of triple-digit inflation (Afanasyef, 1994). At the perceptual level, therefore, this interface is real and has real consequences: demoralization and anomie.

The corrupted process of privatization has generated widespread rationalizations, such as, "it is OK to steal from the state" or "everyone is doing the same thing." Taking an example pointing to international security risks, Lee (1999: 21) has noted that, "perhaps the most serious problem is the growth of a privatization mentality within the nuclear complex. Economic reform has meant a license to steal. This has resulted in broad systemic corruption and a variety of insider threats and conspiracies."

An additional sign of anomie is what has been described as a "culture of urgency" among young killers:

For them there is no hope in society, and everything, particularly politics and politicians, is rotten. Life itself has no meaning, and their life has no future.... So, only the moment counts, immediate consumption, good clothing, good life, on the run, together with the satisfaction of inducing fear, of feeling powerful with their guns (Castells, 2000: 210).

Only effective social controls can halt the process toward further deviance and a higher degree of anomie (deviance without strain). Unfortunately, in Russia and elsewhere, a decreased level of autonomy for certain states, the increased power of international organizations and transnational corporations, and dysnomie add to the fuel.

Dependence, Deregulation, and the Race to the Bottom

"Just between you and me, shouldn't the World Bank be encouraging more migration of the dirty industries to the LDCs (lesser developed countries)?" "I think the economic logic behind dumping a load of toxic waste in the lowest wage country is impeccable and we should face up to that.... I've always thought that underpopulated countries in Africa are vastly under-polluted; their air quality is vastly inefficiently low compared to Los Angeles or Mexico City" (1991 memo attributed to World Bank official Lawrence Summers, who later became U.S. Secretary of Treasury; it is widely believed that he did not write it, even though he has accepted responsibility for it. At any rate, this illustrates the neoliberal mindset).

The loss of autonomy and reduced sovereignty of the state relative to capital referred to earlier (Korten, 1996; Watkins, 1997) is particularly acute in the former Communist countries. Speculative capital will quickly flee each country at the first sign trouble or wavering over neoliberal reforms. External debt grew in all former Communist countries, but especially in Russia, which bears the marks of Africa-like dependent capitalism and "colonial subjugation. The country exports fewer and fewer industrial products and more and more raw materials. Meanwhile, it imports low-quality mass consumption goods, obsolete and hence cheap technology, luxury items and radioactive waste" (Burbach et al., 1997: 120-121). An instance of the direct and blatant interference of foreign governments and transnational corporations in domestic matters was when Chase Manhattan urged the Mexican government to crush the Zapatista rebellion to calm down U.S. investors (Silverstein and Cockburn, 1995; see also Clinard, 1990).

Ironically, the higher degree of dependency in the South and East has lowered the accountability of politicians and corporations. They can now blame globalization for the loss of jobs and lower wages, and prescribe more "efficiency," deregulation, short-term austerity, and declining levels of public spending so as to keep capital in place or attract more. Thus, economic and political leaders appear to be protectors of the public interest and a stabilizing force, while they dismantle existing safety nets (economic neoliberalism has also undermined political liberalism; Klak, 1998).

The Russian government's aversion to regulation (Glinkina, 1994) is observable in other countries, where deregulation turned into competitive deregulation and a race to the bottom. Even in the U.S., the savings and loan disaster and the asymmetric regulation of hazardous wastes demonstrate how criminogenic this process has been. This made it possible to dump legally in Pennsylvania what was prohibited in New Jersey, in what has been termed "crimes without law violations" (Passas, 1999). Such crimes are most likely in the global context given the overwhelming influence of TNCs over national laws and macroeconomic policies. This has prompted some to speak of "rationalized corporate colonialism" (Mander, 1996). Such asymmetries of power make for legal norms that allow overseas that which is, for good reason, criminalized in the base country (e.g., toxic waste dumping, testing drugs on humans, bribery, tax evasion, as well as the patenting of life forms by biotechnology companies and other outrageous practices) (see King and Stabinsky, 1998-1999; Shiva, 1997). The legal asymmetries and uneven power of transnational corporations that create or perpetuate these and other asymmetries give rise to crimes without law violations. Thus, entire countries become vulnerable to victimization by TNCs, a significant problem that is often neglected in conventional discussions of transnational crime. The volatile combination of low wages, bad working conditions, tax breaks only for the rich/corporations, lower environmental standards, deregulation, and less corporate and political accountability with the government relegated to the protection of the international free trade system has predictably made for crises (e.g., Korea, Malaysia, Indonesia, Mexico, and Brazil). It also makes for dysnomie.

Dysnomie and Further (Global) Anomie

Dysnomie literally means "difficulty to govern" and obtains when the following three conditions are present: a lack of a global norm-making mechanism, inconsistent enforcement of existing international rules, and the existence of a regulatory patchwork of diverse and conflicting legal traditions and practices. Russia is in this respect a microcosm that reflects what is happening in the entire world.

Since reforms took place at an uneven pace in each Soviet Republic, an asymmetry grew wider following the collapse of the USSR. In addition, this collapse suddenly created thousands of miles of new borders that had to be policed, just as state resources were diminished. This made for porous borders that offered no resistance to smugglers. This is how Estonia became the largest exporter of nonferrous materials, even though it does not produce any (Glinkina, 1994). Extensive legal changes accelerated the transition to a market economy, but they were marked by inconsistencies and lacked the necessary legal and institutional infrastructure (Handelman, 1995). For example, the law against private entrepreneurship and commercial mediations was repealed only on December 5, 1991. The law against black market transactions, which defined them as "the buying up and reselling of goods or other items for profit-making," was first amended in February 1990 to increase penalties for certain offenses, was then officially rein terpreted to refer only to trade in commodities sold at state-fixed prices (October 1990), and was finally repealed in February 1991 (Afanasyef, 1994: 429). Lack of resources made the problem worse, as underpaid, ill-equipped, and outgunned police could not be expected to do an effective job.

Weak controls allow criminals to get away and to regard themselves as successful. Deviant "solutions" came to be seen as keys to "success." Successful deviance then becomes a normative referent, contributing to a wider normative breakdown and overemphasis on goals at the expense of normative means. In the context of massive cultural shifts -- from the criminalizing of private profit and the hiring of labor outside the household to making them central values for a new social order -- the sense of right and wrong became fuzzy. As the deputy minister of Internal Affairs admitted at a 1992 press conference, "even our specialists find it difficult to determine the legal from the illegal -- to determine, for instance, what is profiteering and what is honest trade" (cited in Handelman, 1993). Corruption grew so much that up to 30% of illegal gains are reportedly paid to government officials (Glinkina, 1994; Lee, 1999). In the end, distinctions between white-collar crime, organized crime, corruption, and legitimate business are almost impossible to make. Lawbreaking behavior and success are fused. As a businessman told Handelman (1995: 139), "the truth is, everything you see around you, all our success, is not thanks to our wonderful economic laws. It's thanks to the fact that we do not obey them."

Dysnomic conditions also bring about anomie at the global level. As argued elsewhere (Passas, 1999), international law is more essential now than ever for the maintenance of world order and security. Yet, big powers are reluctant to contribute to the required pooling of sovereignty and have been blocking the development of an international criminal code and specific legislation to restrain their corporations. Dependent on rich countries for its operations, the U.N. has not been overly aggressive in pursuing these aims or in establishing a permanent international criminal tribunal. Globalism has thus run ahead of the creation of a desperately needed normative and enforcement infrastructure.

Existing international laws are applied selectively and never against one of the permanent members of the U.N. Security Counsel. This ad hoc approach and the extraterritorial application of national laws undermine the legitimacy of current laws and procedures. We are left with a legal patchwork of inconsistent and conflicting rules. An example of the effect of such asymmetries is the secrecy and anonymity available in certain jurisdictions that hinder investigative work by covering the tracks and proceeds of global offenders, de facto shielding them against prosecution and punishment. By exploiting the cracks between diverse state rules, companies continually commit crimes without law violation. Globalism also leads to a relativization of norms and facilitates law violations with a clear conscience (rationalizations and techniques of neutralization).

Finally, the border-policing problem in the former USSR is not unique, even if the underlying causes were specific to it and other European countries (Yugoslavia, Czechoslovakia). More generally, borders become porous, as technology and mobility enabled people, money, goods, and ideas to travel quickly and cheaply. Criminals can take advantage of this shrinking world, but law enforcement agencies are constrained by parochial laws and procedures. Though the reasons for the porousness may differ, the process and results are the same.

Conclusion

Tremendous structural strains have overwhelmed even the usually patient and submissive Russians. The economic situation deteriorated further, hopes were dashed, opportunities for criminal gain and for looting the USSR's assets multiplied, and the anomic societal context offered no assistance to anyone seeking to restore some law and order. In Russia and around the world, the neoliberal operation was successful, but the patients are being systematically frustrated, are starving, and subject to exploitation by corporations, criminal enterprises, and corrupt politicians. In short, globalization and neoliberalism spread analytically similar criminogenic processes that were once unique to the U.S. culture of the American Dream in a context of structural inequalities. Just as the world supposedly became freer, wealthier, more democratic, more enjoyable, and more equal, people find themselves poorer, more exploited, and facing increased hardships. Just as the need for strong normative guidance grows, norms break down or lose their legitimacy. Just as effective controls become necessary to slow down or stop the vicious cycle leading to higher rates of crime, a dysnomic regulatory patchwork remains in place largely because of nationalist insistence on sovereignty and states' unwillingness to allow the introduction of common principles and law enforcement mechanisms.

Two main points need to be reiterated here. First, it appears that global neoliberalism and serious crime go hand in hand. However, it would be erroneous to argue that stereotypical organized criminals are giving capitalism a bad name and undermining neoliberal policies. The implication is that, were we to rid ourselves of some very bad apples, everything would be fine. Rather, it appears that serious organizational misconduct is a consequence of such policies. Second, when we discuss transnational crime, we should bear in mind that it is not just the stereotyped ethnics who cause most problems. It may be that the biggest threat emanates from legitimate corporations and other organizations.

Detailed discussion of policy implications is beyond the scope of this article. The horizontal arrows in Figure 1 hint at the points of possible policy intervention. Myriad concrete ideas can be found in the literature, ranging from legal changes to informal controls, grass-roots movements, integration of economic growth with environmental and social protection, relocalization of production and consumption, etc. The most important ray of hope, however, is implicit in the foregoing analysis. Neoliberal policies and globalization are largely the fruit of (some) governments. They affect and are affected by governance. Therefore, governments have the ability to reverse some of these processes and to mitigate their adverse consequences. Otherwise, the current processes of globalization and neoliberalism will prove to be unsustainable and at a huge cost.

Neoliberal globalization as a catalyst for the rise of ultra-nationalism and neo-fascism

In 2014 a lot of people here condemned excesses of Ukraine nationalism, especially the part of Galician nationalism the has clear neo-fascist flavor and that now attempts to colonize South and Eastern Ukraine in a kind of replay of Drang nach Osten.

But rise of nationalism is a pan-European phenomenon now. And it is observable in almost any county, including but not limited to France, Germany, Poland, Hungary, Greece, and even UK.

Is not this is a (somewhat pervert) reaction to excesses of neoliberalism and neoliberal globalization? In other words is not the key side effects of neoliberal globalization is the rise of ultra nationalist and neo-fascist movements all over the world?  Many researchers think that yes (Globalization, ethnic conflict and nationalism Daniele Conversi - Academia.edu):

The force of nationalism has spread well over the nineteenth century into the age of globalization. There are thus parallels between modernization and globalization as sti-mulating factors for nationalism and ethnic conflict. Although the reach of globalizationis historically unprecedented, some of its features accompanied the rise of modernity andthe advent of the modern nation state. In particular, both resulted in the demise of older boundaries and the construction of new ones. Whereas industrialization destroyed localand regional boundaries by superimposing national boundaries on them, globalizationdestroyed national boundaries by superimposing a plethora of supra-national and corpo-rate networks on them, including mafias, organized crime, and multi-national corpora-tions (MNCs), none of which are as easily identifiable on a political map as sovereign, countries still are. The adoption of planetary rules to comply with the standards set by the International Monetary Fund (IMF) and the World Bank has unsurprisingly resulted in global disempowerment, at least according to the perception of influential NGOs activists (Korten 2001).

Has all this also led to a decline in national identities? Not at all. Partly because nationalcultures have been seriously damaged or reshaped by globalization, we have seen a global intensification of ethnic belligerence. Moreover, the formation of new elites and the spread of capitalist wealth have led to nationalist self-assertion, while cultural impoverishment spurred a generalized need for compensatory ethnic assertiveness.

... ... ...

If nationalism cannot be explained independently from the onset of modernity andmodern state-making, both are enmeshed in the expansion of warfare. Nationalism manifested itself in an era of inter-state competition, the collapse of boundaries, economic expansion, mass migration, general insecurity, political centralization, obsessivelaw-making, societal policing, and drastic militarization, finally leading to war. In them eanwhile, the Pax Britannica ensuing Waterloo provided the impetus for colonialexpansion while fomenting inter-imperial rivalries and competition (Conversi 2007).Thus, just as Europe was accumulating wealth, power, and armaments in anticipation of the unprecedented conflagration, its global economic reach affected broader and broader areas of the world. Economic competition and destructive warfare were just beingexported beyond European borders. Linda Colley notes:

the profit and the price of this hundred-year partial European peace was unprecedented Western, and especially British, freedom to concentrate on global empire. In 1800, the European powers, together with Russia and the United States, laid claim to some 35 percent of the globe’s total land area. By 1914 [their] proportion of the globe … had risen to 84 percent (Colley 2002:311).

By 1914, the West had also accumulated enough economic wealth and weapons of mass destruction to unleash the greatest manslaughter in human history. The totalitarian era following the First World War has been described as the culmination of a pattern of mass dislocation founded on modernity (Arendt 1958; Bauman 1989). As we shall see later, the emergence of totalitarianism in Europe coincided with the first wave of deep Americanization, including the triumph of Hollywood, cigarette consumption, the car culture, and other US products meant for mass distribution.

... ... ...

The expansion of nationalism throughout the globe is hence the spreading out of aWestern idea. In other words, nationalism is an essential component of Westernization.As I have argued, nationalism cannot be understood outside the devastating impact of modernity, particularly industrialization, with its demise of traditional lifestyles, skills,cultures, and communities (Gellner 2006). Such a devastation was suciently all-pervasiveto argue that the victory of nationalism represented the victory of a surrogate sense of community, which for some was a colossal
‘ fraud’ (Gellner 2006) or an invented tradition (Hobsbawm 1983). Thus, for Gellner the nationalists spoke in defence of a hypo-thetical Gemeinschaft, but actually practiced the construction of a novel Gesellschaft, the two being largely incompatible. For both Gellner and Hobsbawm nationalism was not much less than a form of cultural
brainwashing. For others, the whole process was not only counterfeit, it was based on the conspiracy of emerging rapacious economic and political elites, which used selected elements of popular tradition while invoking nationhood, just as populists often invoke the defence of the people. For instance, the role of secret societies like the Italian carbonari is a widely known and omni-present feature of nineteenth-century century mobilization. Secret paramilitary groups of patriots played a pivotal role in the spread of most nationalist movements. Karl Marx’s characterization of nationalism as a form of false consciousness manipulated by the bourgeoisie is a well-known example of this conspiracy approach. Traditionalist, anarchical, conservative, and even liberal approaches often share similar views of nationalism as a strategy of elites. The broader trend is often known as instrumentalism(Smith 1998),because it emphasizes the mere instrumentality of nationhood. Nations do no exist assuch; they are simply cultural tools in the hands of elites or proto-elites who seek to mobilize the masses on the basis of an emotional appeal to a common but fictitious nationality.

As we shall see, in its current shape cultural globalization is often understood as a one-way importation of standardized cultural items and icons from a single country, the United States of America, to the rest of the world regardless of the fact that most of theitems are actually made in China. For many, globalization is synonymous with Westernization (la Branche 2003, 2005, Latouche 1996) or, more accurately, Americanization.The international consequence of Americanization is a widespread sense of cultural insecurity vis-à-vis an unfathomable force that nobody seems capable of containing(Amin 2004). Because this perception has been so far unable to produce organized, rational and universal responses, it tends to express itself through visceral, rudimentary,and unpredictable forms of anti-Americanism (Barber 1995).

Former Secretary of State Madeleine Albright showed insights about the US full-spectrum dominance cultural policy when she said that Cultural factors play a pivotalrole in many of the international challenges we face
our cultural programs are central -- and I underline that —  central to the success of American foreign policy
(Albright2000). Once out of office, she adopted a more cautious position, considering the risks and damages infl
icted by extreme forms of Americanization. For Bacevich (2002), the economic openness implicit in neoliberalism produces a form of globalization that is inevitably synonymous with Americanization, since it is predicated on a national security approach founded on global dominance.

Conclusions

Situation with neoliberalism in the USA now is an almost perfect illustration of the credibility trap. One cannot allow the illusion to falter, even a little, to the bitter end. And as the fraud fades, the force intensifies, becoming almost rabid in its deflection. Because that illusion has become the center of a hollowed people's being, their raison d'être, a mythological justification for their existence. Chris Hedges made an apt analogy with The Fall of Berlin 1945

I came across a nice, compact interview with Chris Hedges which illuminates his thesis of the decline of the American Empire and the illusions and the end of rational thinking that accompanies it. Empires seem to give off quite a bit of flash in their latter stages, rather like the last gasp of a dying star.

The interviewer, Allan Gregg, does a particularly nice job of drawing Hedges out.

I would like to add an observation I came to in thinking further about the Sophie Scholl piece which I put up earlier today. Perhaps there is something about gardening that focuses the mind.

The almost frenetic preoccupation and adherence to the Nazi ideology in the latter stages of the war, when it was obvious to any rational observer that they could not win, is remarkable. I had been particularly struck in my reading some time ago with the 'wolf packs' of Nazis who had raged through Berlin, rounding up old men and even boys who had not joined the Volkssturm, and hanging them, even while the Russians were shelling the Reichstag. It never made sense to me until today.

"The radio announced that Hitler had come out of his safe bomb-proof bunker to talk with the fourteen to sixteen year old boys who had 'volunteered' for the 'honor' to be accepted into the SS and to die for their Fuhrer in the defense of Berlin. What a cruel lie! These boys did not volunteer, but had no choice, because boys who were found hiding were hanged as traitors by the SS as a warning that, 'he who was not brave enough to fight had to die.'

When trees were not available, people were strung up on lamp posts. They were hanging everywhere, military and civilian, men and women, ordinary citizens who had been executed by a small group of fanatics. It appeared that the Nazis did not want the people to survive because a lost war, by their rationale, was obviously the fault of all of us. We had not sacrificed enough and therefore, we had forfeited our right to live, as only the government was without guilt."

Dorothea von Schwanenfluegel, Eyewitness account, Fall of Berlin 1945

I was reminded of this phenomenon by the trial of Sophie Scholl, and her words to the judge Roland Freisler, as he ranted his virulent condemnations at them. 'Soon you will be in our place,' she said to him. He did escape the hangman's noose at Nuremburg, but only by virtue of an Allied bomb in 1945. When his body was brought to hospital an orderly remarked, 'It was God's verdict.' He was buried in an unmarked grave, without ceremony and unmourned. Much like his beloved Fuhrer.

This is an almost perfect illustration of the credibility trap. One cannot allow the illusion to falter, even a little, to the bitter end. And as the fraud fades, the force intensifies, becoming almost rabid in its deflection. Because that illusion has become the center of a hollowed people's being, their raison d'être, a mythological justification for their existence.

If the ideology had been a lie, then they are not heroes and gods on earth, but monsters and criminals, and their life has been self-serving and meaningless, without significance and honor. And that is the credibility trap.

And this is the US financial system today.

So the legitimacy of neoliberalism is gone since events of 2008 and consequences of this epochal event are still unclear. As chances that the USA will get rid of neoliberalism voluntarily are slim, we might be present in a crush of yet another empire. That might mirror the destiny of the USSR which fell when its ideology became delegitimized. With the key difference that the USA elite is much more aggressive and ready to use whatever means possible to preserve its status when it is under threat.


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[Feb 10, 2016] Theres a special place in hell for women who have the blood of children on their hands.

www.nakedcapitalism.com
Generalfeldmarschall von Hindenburg

Re: Albright – There's a special place in hell for women who have the blood of children on their hands.

Jim Haygood

Meanwhile, the kids she hasn't 'neutralized' yet scream when they see Albright's ghoulish visage, calling in another drone strike:

https://griid.files.wordpress.com/2013/01/albright_at_war-thumb.jpg

One word, Madeleine: Nuremberg.

sleepy , February 9, 2016 at 4:30 pm

Clinton campaigned in 2008 on the notion of inevitability. When that inevitability showed cracks, she failed. She has campaigned in 2016 on the notion of inevitability. Same result.

In 2016 as in 2008 she has no alternative game plan other than to react with childish insults, as if the thought of having a real challenger was never considered. Must be that famous legend in her own mind at work. Another example of poor judgment.

NotTimothyGeithner , February 9, 2016 at 5:27 pm

Inevitability is a nice way to put entitlement. "I'm with Hillary" says the campaign is about Hillary's personal success. She could have run a unity campaign about electing more Democrats and just ignored a challenger.

Jim Haygood , February 9, 2016 at 5:56 pm

Not to mention that her HillaryCare celebrity tour of six Congressional committees in 1993-94 also was premised on inevitability.

Results : (1) not a single committee reported out a bill; (2) the Democratic party lost its majority in the House for the first time in forty years.

How many times do we have to watch this boring movie … especially with such dismal casting?

ekstase , February 9, 2016 at 6:13 pm

Perhaps we should be grateful for the blind spots. They're a big part of karma's delightful unfolding.

[Feb 09, 2016] Stability breeds instability

Economist's View

New Deal democrat :

On the specific point of the artilce, this strikes me as a similar theory to Minsky's "stability breeds instability" theory. Also I seem to recall Prof. Thoma posted an article showing that the tightness or looseness of credit conditions were a good long leading indicator of conditions about 2 years later.

As an expansion goes on, both businesses and consumers take increasing risks, having been previously rewarded for risks taken. Thus they leave less and less of a margin of safety. This makes it easier for any given shock to overcome that margin, causing both businesses and consumers to retrench. Thus a recession begins.

I'm not sure about businesses, but consumers have been playing it safe throughout most of this recovery, with the personal savings rate increasing over the last few years. So, relatively speaking, for now consumers have a decent margin of safety.

Ben Groves -> New Deal democrat...
Right, but the personal savings rate fell well out of line in the 00's and actually contracted in 2007-8. More like restocking than playing it safe.
likbez -> New Deal democrat...
In addition gas prices are still low.
likbez -> New Deal democrat...
On the specific point of the article, this strikes me as a similar theory to Minsky's "stability breeds instability" theory.


And that is deeply true. Minsky (actually this is Hegel) was and still is right.

Hyman Minsky simply stressed that people's response to stability in financial markets always engenders instability as it encourages more risky behavior. Such behavior is not necessarily irrational, as there are profits to be earned and bonuses to collect as long as the good times last.

In fact, the cycle may extend as long as credit flows and people are hungry for risk. Yet according to Minsky's casino capitalism credit cycle always heads inexorably toward a bust.

At some point risk and reward became out of whack and people start reposition their portfolios defensively, increasing cash allocations. At this point house of cards folds.

[Feb 09, 2016] All this obsession with miniscule rate changes has obscured the need for the Fed and politicians to make significant changes

February 08, 2016 | economistsview.typepad.com

JohnH said...

It is certainly appropriate to question the condition and longevity of this 'recovery,' which was never experienced by most Americans, whose incomes are mired back where they were two decades ago.

Can we infer by all this that liberal economists are finally becoming reflective about the Fed's failure to ignite growth? Old nostrums die hard.

Unfortunately, all this obsession with miniscule rate changes has obscured the need for the Fed and politicians to make significant changes, so that the benefits of low rates are felt throughout society, not just by Wall Street, the wealthy, and affluent homeowners with mortgages.

And, instead of constantly arguing against austerity, why not aggressively tout high taxes on the wealthy to pay for stimulus, which would generate economic growth and address inequality in one fell swoop!

JohnH said in reply to djb...

djb is obsessed with "the rate."

Why not get obsessed with the fact that the Fed could not stimulate new rental housing, despite historically low mortgage rates? As a result of the housing shortage, rents are skyrocketing, sucking up incomes, already hit hard by the unending recession. Result: less money available for consumption, more money into the pockets of real estate moguls.

Why not obsess about real credit card rates, which are higher than they were in 2007? Result: less money available for consumption, more money to VISA and its share holders.

But no, 'liberal' economists obsess only about "the rate," which affects almost nobody but Wall Street banks, their wealthy clientele, and affluent mortgagees.

Let's face it, the Fed has failed in part because low rates and their effects failed to trickle down much. But 'liberal' economists could care less about this. All they care about is "the rate!"

If 'liberal' economists cared half as much about why low rates are not diffusing throughout the economy as they care about "the rate" for Wall Street, then we could believe that they care about the general welfare, not the interests of the 1%.

[Feb 08, 2016] Tech stock collapse sure looks like bubble popping

finance.yahoo.com

Almost all technology stocks are getting hammered yet again on Monday. Salesforce.com (CRM) was down 6% while Facebook (FB) and Microsoft (MSFT) had lost 3%, for example, in morning trading.

And while many see it as a continuation of Friday's rout sparked by LinkedIn's (LNKD) weak outlook for the rest of the year, the damage has been piling up for weeks. Investors are fleeing almost all tech names over concerns about the slowing global economy in general and a reassessment of the potential growth of online and "cloud" markets more specifically.

LinkedIn, pummeled by an unprecedented 44% one-day loss Friday, was one of the few tech stocks rising on Monday, as bargain hunters pushed its shares up 3% in early trading. Still, the shares have lost more than half of their value since the end of 2015.

The widespread tech crash is all the more surprising because almost everyone thought there was no bubble in the tech sector. Last year's market for initial public offerings of tech companies was the slowest since 2009 (and performed poorly throughout the year), slightly more seasoned public tech companies appeared to have already crashed last spring and most of the big tech companies, such as Apple (AAPL), IBM (IBM) and Cisco Systems (CSCO), trailed the market and appeared undervalued by historical measures. Only the so-called FANG stocks -- Facebook, Amazon (AMZN), Netflix (NFLX) and Google's Alphabet (GOOGL) -- did well, with an average return of 83% each in 2015.

But, it turns out, there was still plenty more downside risk to go around. LinkedIn is still off by more than 40% since it reported earnings after the market closed on Feb 4. Although fourth quarter adjusted earnings per share of 94 cents and revenue of $862 million beat the average Wall Street analyst estimate, the professional social networking company said it would earn only 55 cents on revenue of $820 million in the next quarter. And for the full year of 2016, revenue of $3.6 billion to $3.65 billion was less than the $3.9 billion Wall Street had been expecting.

Such a modest disappointment has sparked a massive reassessment of the potential for many Internet stocks. With investors in a panicky mood, the carnage has spread across much of the tech sector but stocks with online business strategies similar to LinkedIn's have been hit especially hard. Workday (WDAY), which provides online software for human resources, was down 7% midmorning on Monday and 37% for the year. Twitter (TWTR) lost 4% and was down 35% for the year. And Adobe Systems (ADBE) was off 5% on Monday and 20% for the year. A daily index compiled by venture capital firm Bessemer Venture Partners of 47 publicly traded cloud software stocks lost 17% just on Friday.

And those famous FANG stocks? They're all down in 2016, as well. After its 3% Monday drop, Facebook was still best of the bunch, showing a modest 4% loss for the year. Amazon was also down 3% on Monday but carries a crushing 28% loss for the year. Netflix was a rare gainer, up 1%, but still off 27% for the year. And Google was down 1% on Monday and 11% for the year.

[Feb 08, 2016] Momo Bad News JPMs Quant Guru Kolanovic Confirms Tech Bubble Has Burst... Again

Zero Hedge
Just over two weeks ago, JPM's Marko Kolanovic, whose unprecedented ability to predict short-term market moves is starting to seem a little bizarre, warned that the next "significant risk for the S&P500" was the bursting of the "macro momentum bubble." Specifically, he said that there is an emerging negative feedback loop that is "becoming a significant risk for the S&P 500" adding that "as some assets are near the top and others near the bottom of their historical ranges, we are obviously not experiencing an asset bubble of all risky assets, but rather a bubble in relative performance: we call it a Macro-Momentum bubble ."

In retrospect, following tremendous valuation repricings of several tech stocks, last week's LinkedIn devastation being the most notable, he was once again right. And over the weekend, he did what he has every right to do: take another well-deserved victory lap.

This is what he said in his February Market Commentary: " Tech Bubble Burst ?"

In our 2016 outlook and recent reports, we identified a macro momentum bubble that developed over the past years. We explained its drivers (central banks, passive assets/momentum strategies, etc.) and called for value to outperform momentum assets. We also highlighted the risk of a bear market and recommended increasing exposure to gold and cash as well as increasing exposure to nondollar assets relative to the S&P 500 (EM Equities, Commodities, Value Stocks, etc.). Our view was that a likely catalyst would be the Fed converging toward ECB/BOJ (rather than proceed with planned ~12 rate hikes by end of 2018). In line with these published forecasts, the best performing assets YTD have been Gold (+9%) and VIX (+20%) while S&P 500 and DXY are down (-7%, and -2%, respectively). Momentum stocks are down more than 10% with an acceleration of the selloff in last days. Emerging Market and Energy stocks are starting to outperform the S&P 500 (MSCI Latin America by +5% and Energy by +1% vs. S&P 500 YTD). This specific pattern of asset moves is consistent with a Value-Momentum convergence. We think the outperformance of value assets over momentum assets is likely to continue .

Investors often ask us how significant are distortions and risks in equity sectors that are related to a "macro momentum bubble." Specifically, the question is that of valuations in the Technology sector, i.e., "is there a Tech bubble"? Before we share our views, let's first review how passive investing and momentum strategies may have impacted performance of various equity sectors.

Imagine a world in which most of the assets are passively managed and investors are focused on liquidity and short-term risk/reward. Companies that increased in size recently would keep on increasing, and those that got smaller would see further outflows. Past winners would also be considered low-risk holdings compared to past losers. The most successful managers would be those that replace fundamental valuation with a simple rule: buy what went up yesterday and sell what went down. Passive funds would do the same. It is hard to imagine this makes economic sense long term, but it is close to what equity markets experienced over the past several years. In 2013, the Sharpe ratio of the S&P 500 was ~2.7. Assuming a normal distribution of active asset returns, one could (incorrectly) conclude that being just an average (passive) investor one will outperform ~95% of all active investors. In 2014 and 2015, various momentum strategies delivered Sharpe ratios >2. The winning strategy was not just to go with the crowd, but to do what the crowd did yesterday. This type of trend following does not only apply to extrapolating price trends, but also extrapolating trends in fundamental stock data such as growth and earnings. Beyond a certain point, passive investing and trend following are bound to result in distorted equity valuations and misallocation of capital.

While some parts of the Technology sector certainly have reasonable and even low valuations (see our US equity strategy outlook), segments of the Tech sector disproportionally benefited from momentum investing as well as investing based on extrapolation of past growth rates . For instance, a popular group of stocks held by investors is known by the abbreviation "FANG" (Facebook, Amazon, Netflix, Google). We use these stocks as an illustration for a broader group of similar stocks that have the highest rankings according to momentum and growth metrics (and surprisingly in some cases even low volatility metrics). Given that traditional value metrics look expensive when applied to this group, one can compare these momentum/growth companies on a new set of metrics. For instance, one can look at the ratio of current price to earnings that the company delivered over all of its lifetime (instead of just the past year). Another metric could be a ratio of CEO or founder's net worth to total company earnings delivered during its lifetime (see below):

Aggregating all FANG earnings since these companies were listed, one arrives at a ratio of current price to all earnings since inception of ~16x. This can be contrasted to a ratio of price to last years' earnings for all other S&P 500 companies also at ~16x. We think this is extraordinary given that FANGs are neither small nor new companies. In fact, these are some of the largest companies in the S&P 500 and among the largest holdings of US retirees. Given that the three largest FANG stocks are now twice more valuable than the entire US S&P small-cap universe (600 companies), a legitimate question to ask would be " is such a high allocation by long-term investors to these stocks prudent?" Statistically, over a long period of time smaller companies outperform mega-caps ~75% of times. Note also that the current size ratio of mega-cap stocks to small-cap stocks is at highest level since the tech bubble of 2000. Furthermore, such allocation is also questionable from a risk angle . For example, the idiosyncratic risk of holding three stocks in one sector is certainly much higher than the risk of owning, e.g., ~1,000 medium- or small-cap companies diversified across all sectors and industries.

Investors in high-growth stocks expect innovations to drive growth and sustain high valuation. They may even put their hopes in moonshot projects such as cars built by electronics makers, car makers building spaceships, or internet companies building drones. While many of these could result in important technological breakthroughs, they may also be signs of excess and destruction of shareholders' capital in the future. Recent examples of capital impairment in the tech sector are illustrated here and here, and more peculiar examples of past excess can be found here and here. In addition to extrapolated and often optimistic growth forecasts, some of the tech sub-industries have high idiosyncratic risks that are likely underappreciated by the market. Standard valuations models incorporate revenue, growth, and profit forecasts but often do not discount for the lifecycle risk of a business. To illustrate: while we are still traveling in aircraft designed over 40 years ago, social network users' preferences have changed drastically over the past decade (e.g., Friendster and Myspace). A shorter lifecycle is related to low barriers to entry and rapid changes in what is deemed fashionable by young generations (e.g., one cannot build a jetliner in a dorm room, and they don't go out of fashion as apps do).

In summary, we think that the biases of momentum investing and passive indexation have resulted in valuation distortions across assets as well as equity segments including Technology . Over the past years this trend has picked winning assets, sectors, and stocks often with less regard to fundamental valuation and more regard to momentum and extrapolated growth. We believe that 2016 may result in a reversion of this trend that will give an opportunity to active and value investors to outperform passive indices and momentum investors . Even if this rebalancing comes as a result of market volatility and broader equity declines, long term it will benefit capital markets and the efficient allocation of capital .

* * *

Only problem is that this capital reallocation will means countless momentum chasers 'smart money managers' will be out of a job in very short notice.

Then again, judging by some initial reactions, even formerly steadfast believers in the FANGs are starting to bail: moments ago CNBC reported that Mark Cuban announced that he purchased options to sell against his entire stake in Netflix, to wit: "For those of following my stock moves, I just bought puts against my entire Netflix position. "

Cuban posted comments on Cyber Dust social media platform on Friday. Result: NFLX already down -4%, with FB and other tech momos hot on its heels.

[Feb 04, 2016] Pitchfork Time Elites Have Lost Their Healthy Fear Of The Masses Zero Hedge

Notable quotes:
"... Is it time for pitchforks to restore the natural orders of fear yet? ..."
www.zerohedge.com

Zero Hedge

The following reader comment, posted originally in the FT is a must read, both for the world's lower and endangered middle classes but especially the members of the 1% elite because what may be coming next could be very unpleasant for them.

Elites have lost their healthy fear of the masses

Sir, Martin Wolf (" The losers are in revolt against the elite ", Comment, January 27) and Andrew Cichocki ("Elites are listening to the wrong people ", Letters, January 29) skirt the key issue: global elites have lost a healthy sense of fear.

From the time of the French Revolution until the collapse of communism, what successive generations of elites had in common was a sense of fear of what the aggrieved masses might do . In the first half of the 19th century they worried about a new Jacobin Terror, then they worried about socialist revolution on the model of the Paris Commune of 1871. One reason for the first world war was a growing sense of complacency among European elites. Afterwards they had plenty to worry about in the form of international communism, which remained a bogey until the 1980s.

With the collapse of the Soviet Union and the spread of global capitalism, today's elites have lost the sense of fear that inspired a healthy respect for the masses among their predecessors . Now they can despise them as losers, as the aristocracy of ancien régime France despised the peasants who would soon be burning their châteaux. Surely today's elites are going to learn how to fear before we see any reversal of the recent concentration of wealth and power.

Is it time for pitchforks to restore the natural orders of fear yet?

h/t @ WallStCynic

Looney

Is it time for pitchforks to restore the natural orders of fear yet?

Oh, honey, I thought you'd never ask… ;-)

Goliath Slayer

How they turned us into Pavlov Dogs >> http://wp.me/p4OZ4v-1zD

Stuck on Zero

It's hard to get rid of most of the elites because they have tenure.

tarabel

And most people wouldn't have the faintest idea of where to buy, or more probably rent, a pitchfork anyhow. As for torches? What, are you crazy? Those things are dangerous and would void our insurance policy.

bamawatson

will goldman sucks n shitty bank loan me money to purchase a pitchfork? http://theconservativetreehouse.com/2016/02/03/update-fec-informs-ted-cr...

MayIMommaDogFac...

REALLY LONG pitchforks!

rocker

I'd like a Cattle Prod. You got to believe Homeland is reading this one.

Future Jim

Elites are afraid of socialism and communism?!

The Elites are the ones who created and spread such collectivism because collectivism is how they control the masses, and they make the masses think they are afraid of it so that the masses will demand it. The masses demand to be enslaved by socialism and communism. They are being played.

Elites only fear the free-market. That is why we don't have one.

AldousHuxley

It really doesn't matter what *ism society embraces. What matters more is is the power elite greedy enough to sell out their own kind?

Future Jim

If you think that freedom is just another ism, then you have been played.

It is not about greed. It is about power and control. Money is just a means to that end.

Their own kind? You mean their own race ... their own nation ... their own religion ... ?

CapnJackDaniel

Nice, but a little quick donchathink?

Cadavre

And a roasting spit and rope to tie em by the ankle to the cherry trees lining the national mall, Musollini style. Urinals hanging from cherry trees. Only in America.

One does wonder how inbreds surrounded by expensive advisors so easily lost any shred of fight-o-flight survival skills. Guess the extra bling allows them to dream false dreams.

eforce

The ones who think they are 'top dog' are about to find out the hard way, there is something much bigger at work...

"6. The people, under our guidance, have annihilated the aristocracy, who were their one and only defense and foster-mother for the sake of their own advantage which is inseparably bound up with the well-being of the people. Nowadays, with the destruction of the aristocracy, the people have fallen into the grips of merciless money-grinding scoundrels who have laid a pitiless and cruel yoke upon the necks of the workers.

7. We appear on the scene as alleged saviours of the worker from this oppression when we propose to him to enter the ranks of our fighting forces - socialists, anarchists, communists - to whom we always give support in accordance with an alleged brotherly rule (of the solidarity of all humanity) of our social masonry. The aristocracy, which enjoyed by law the labor of the workers, was interested in seeing that the workers were well fed, healthy, and strong. We are interested in just the opposite - in the diminution, the killing out of the goyim. Our power is in the chronic shortness of food and physical weakness of the worker because by all that this implies he is made the slave of our will, and he will not find in his own authorities either strength or energy to set against our will. Hunger creates the right of capital to rule the worker more surely than it was given to the aristocracy by the legal authority of kings.

8. By want and the envy and hatred which it engenders we shall move the mobs and with their hands we shall wipe out all those who hinder us on our way."

--The Protocols

freak of nature

Fear might be masked, but it's still there.

http://www.washingtontimes.com/news/2015/sep/30/angela-merkel-caught-on-...

Memedada

http://www.rense.com/general45/proto.htm - they're fake.

eforce

You're fake.

Mr. Universe

The thing is that there are going to be a LOT of folks who thought they were elites. Instead they will be thrown under the bus of the approaching hoards to slow them down while the real elites make sure no one escapes that shouldn't be.

They no longer fear the masses as they control the cops and the narrative. What will really work and is almost unstoppable is the ghost in the machine. Seemingly random acts of sabotage, just think if the internet went down for even 2 or 3 days. Who would it hurt most, average folk or ? I have a dream...

css1971

Sternly worded letters will be flying thick and fast.

indygo55

A torch might mess up my nails

tarabel

And you'll need new shoes cause those definitely don't match.

wildbad

https://www.youtube.com/watch?v=USk-ECjYEhI

Lorca's Novena

Lol those guys are so blackwater.... It is illegal to have a standing "army" on 'murrican soil. Private for hire jagoffs arent. And no, it wasnt the national guard.

Chris Dakota

60% of the people who live in Burns work for the BLM.

Looney

Oops! ;-)

alexcojones

I think Pitchforks are way too tame. If this patriot lived today he would be decalared a TERRORIST

The First Hero of the American Revolution

Mark Mywords

" Surely today's elites are going to learn how to fear before we see any reversal of the recent concentration of wealth and power."

Surely, you jest. The proles won't attack the elites. They won't be able to find them, or get to where they live.

Tyler(s), you need to stop posting such meaningless tripe. When the serfs rise up, they will attack what is around them. As always.

bbq on whitehou...

The internet doesnt forget or forgive transgressions. Sins of the father shall be paid for by their sons.
"Where are you going to run, where are you going to hide; no where because there is no where left to run to." - Body snatchers

tarabel

I think you are correct so far as you take your argument. Yes, they will START on their own neighborhoods.

The depth of the fall can be graphed against how far they will go afterwards.

El Vaquero

Then we just cut their supply lines.

knotjammin2

It is our son's and daughter's who protect the elitist assholes. We know where they built their bugouts and landing strips. We built them. We know where the air vents are for their underground bunkers. We built them. We know where the diesel tanks are to power their generators and you can't hide solar panels. No, we know where there going and how to get to them. Soon!!

Mr. Universe

Now you know why the hawaiian's, when they sent a worker down the side of a cliff to bury the chiefs bones in that space reserved for the Ali'i, they "accidently" let go of the rope while he was climbing back up...oopppps, sorry bout 'dat brah.

indygo55

"The proles won't attack the elites. They won't be able to find them, or get to where they live."

Oh you mean like the French Revolution or the Chinese Revolution? Like that?

HardAssets

No, the proles do little of substance. But, the time is reached when even their paid off guard dogs will be tired of the insanity that destroys their own extended families. (The psychopaths can't help but push it to the extremes. That is their egotistical nature. Theyve been indulged since they were infants.) When that day of reckoning comes, the criminals will be very afraid.

The EU 'leadership' bringing in massive outside foreign populations to destroy the existing culture and nation-state is a potential match for the fuse of anger. We see police carrying out orders, but what do they really think ? How bad will they let it get ? Even the Red Army troops refused to go along with it all when the grandmas scolded them for taking part in rolling the tanks toward their own people. And those troops said "Nyet, no more of this." And the USSR was no more.

conraddobler

Maybe they haven't played a lot of sims?

I used to love the old sims of feudal japan where you could set your tax rate at whatever you wanted but the higher you set it the more likely you would get a peasant revolt.

What's going on is precisely this:.....

They have learned how to set the tax rate at whatever percentage won't cause utter chaos and then absolve themselves from said taxes through loopholes AND THEN add on top stealth taxes in the form of currency debasement AND THEN on top of all this they've built a ponzi scheme debt based fiasco that is entirely unsustainable.

I gotta hand it to them they have managed so far to avoid the ire of the peasant class, however methinks that once this shit show rolls into town and starts playing nightly as in reality comes a callin then these same folks are going to need to hide off planet.

Seriously I'd advise them to look into space travel.

DipshitMiddleCl...

The elites today were related to the elites of yesterdays revolutions

They have learned and are keeping track of everything and with the advent of big data and lots of computing power, they know how much time they have before SHTF.

They have quants assessing risk daily, and not just market risk..geopolitical and other stuff.

They dont fear us because they know they can keep ramping up poisoning of our food and other stupid social media gimmicks.

If all else fails, the jackboots will come out in full force.

They've been testing and training these detention methods for close to 100 years. From the gulags of Russia to the West Bank / Gaza strip today of Israel.....its being tried and trued.

And we're next!

~DipshitMiddleClassWhiteKId

carlnpa

The past nine months have set record monthly background checks. I believe we as a "group" know and feel our existence is in danger, and are responding accordingly.

alexcojones

Certainly a patriot CANNOT do it through the ballot box,

Iowa: Days before the Iowa caucuses in 2012, Ron Paul held a commanding lead in the polls and all the momentum, with every other candidate having peaked from favorable media coverage and then collapsed under the ensuing scrutiny. Establishment Republicans, like Iowa's Representative Steve King (R), attempted to sabotage Paul's campaign by spreading rumors he would lose to Obama if nominated. . . Iowa Governor Terry Barnstad told Politico , "[If Paul wins] people are going to look at who comes in second and who comes in third. If Romney comes in a strong second, it definitely helps him going into New Hampshire". The message from the Iowa Governor to voters of his state was: a vote for Ron Paul was a wasted vote.

How t he Republican Party Stole the Nomination from Ron

August

The RNC and their minions would have prevented a Ron Paul pesidential nomination, by any means necessary - up to and including a terrible, just terrible, plane crash. All those lives lost....

pipes

They DID prevent the nomination by any means necessary...and did so, short of crashing a plane. The underhanded shit they pulled in '12 sealed their fate. Kirk2NCC1701

In that case, the Libertarian Party needs to go "full Zio-mode": Take no BS and no prisoners.

Problem is, they are too "individualistic" (divided, heterogenous), and too 'Christian' (raised in "Religion of Serfs") to create another American or French Revolution, or bring about real change.

Note that in the American Revolution, its Founders realized that the influence of Clerics needed to be curtailed, and so they invented the "Seperation of Church and State". The French, OTOH, called a spade a spade, and got rid of the Church completely.

Amerika: Where kids are taught by their parents to believe in the Tooth Fairy, Easter Bunny and Santa Claus -- all the while they believe in "Santa for Grownups", i.e. Winged Nordic Humans (Angels) and a Sky God.

I have ZERO faith that Libertarians will do anyting, other than talk, blog, hold meetings, conventions, have weekend warrior games, or buy any number of Doomsday Products and Services. IOW.. they'll do anything and everything, but March or Protest en mass. They won't even do TV program, much less do a leveraged buyout of a TV channel.

Like I said: "Too individualistic, to truly matter to TPTB". I WISH it were not to, but I'm just calling it as I see it. Alas. If I'm wrong, I'll jump for joy and click my heels.

alexcojones

BTW - Fuck Iowa

And thank you Stanford for Stomping them in the Rose Bowl

Pitchfork Voting Machines

all-priced-in

Do they have to get off the sofa or can they just send it in on Instagram?

[Feb 03, 2016] Lies of the Neocons From Leo Strauss to Scooter Libby

Notable quotes:
"... A superb account of the ideas of Strauss, his followers and his influence is to be found in The Political Ideas of Leo Strauss (hereafter PI) and Leo Strauss and The American Right (hereafter AR), both by Shadia Drury, professor of politics at the University of Calgary. Her account of Strausss ideas and the prominence they play in American politics today will give you chills or nausea, perhaps both. As she says in PI (p.xii), Strauss is the key to understanding the political vision that has inspired the most powerful men in America under George W. Bush. In my view men who are in the grip of Straussian political ideas cannot be trusted with political power in any society, let alone a liberal democracy. This book explains why this is the case. ..."
"... So the covert elite must be certain that myths like religion or the glory of the nation are not weakened for these are among the best ways to rule over the ignorant herd and lead it into war. (Note that the Straussians themselves are not religious. They are above religion, capable of dealing with tough truths like mans mortality. But in their view, religion is a crucial factor in governing in their view. Irving Kristol, following Strauss, tells us that religion is far more important politically than the Founding Fathers believed and that to rescue America it is necessary to breathe new life into the older, now largely comatose religious orthodoxies. (AR, p. 148). ..."
"... But useful lies of the grand sort like religious myth or blind nationalism need support by lesser lies at crucial moments. And so we go to the smaller lies like weapons of mass destruction, the smoking gun that comes in the form of the mushroom cloud. And here too the elite has a role to play. They are to use their superior rhetorical skills to make the weak argument seem stronger. In other words the cabal not only has to protect myths and manufacture lies but go to work in selling them. What Strauss called rhetoric, we call spin. ..."
"... All of this comes down to one word: lying. But for Strauss, these lies are necessary for the smooth function of society and triumph of ones own nation in war. Hence for Strauss, the lie becomes noble. This phrase Strauss borrows and distorts from Plato who meant by a noble lie a myth or parable that conveyed an underlying truth about morality or nature. But in Strausss hands the noble lie becomes a way of deceiving the herd. Strausss noble lies are far from noble. They are intended to dupe the multitude and secure power for a special elite (AR, p. 79). ..."
OpEdNews
All governments lie as I. F. Stone famously observed, but some governments lie more than others. And the neocon Bush regime serves up whoppers as standard fare every day. Why this propensity to lie? There are many reasons, but it is not widely appreciated that the neocons believe in lying on principle. It is the "noble" thing for the elite to do, for the "vulgar" masses, the "herd" will become ungovernable without such lies. This is the idea of the "noble lie" practiced with such success and boldness by Scooter Libby and his co-conspirators and concocted by the political "philosopher" Leo Strauss whose teachings lie at the core of the neoconservative outlook and agenda, so much so that they are sometimes called "Leocons."

Leo Strauss (1899-1973) was a Jewish-German émigré from the Nazi regime who eventually landed at the University of Chicago where he developed a following that has achieved enormous prominence in American politics. Among his students were Paul Wolfowitz who has openly acknowledged that he is a follower of Straus as has the godfather of neconservatism, Irving Kristol. Irving Kristol begat William Kristol, the director of operation for the DC neocons, editor of the Weekly Standard and "chairman" of the Project for the New American Century, which laid out the plans for the Iraq War. (PNAC also opined in 2000 that a Pearl Harbor-like event would be necessary to take the country to war, and one year later, presto, we had the strange and still mysterious attack of September 11.) For his part Paul Wolfowitz begat Libby, in the intellectual sense, when he taught Libby at Yale. Others stars in the necon firmament are Richard Perle, Douglas Feith and lesser figures like Abram Shulsky, director of the Pentagon's Office of Special Plans, created by Donald Rumsfeld. Shulsky, also a student of Strauss, was responsible for fabricating the lies masquerading as intelligence that were designed to get the U.S. into the war on Iraq. While the neocons have a passion for the Likud party and Zionism, they also count among their number not a few pre-Vatican II Catholics and an assortment of cranks like Newt Gingrich and John Bolton and crypto fascists like Jeanne Kirkpatrick. The list goes on and Justin Raimondo has documented it in great detail over the years on Antiwar.com. But it is enough to note that Cheney's alter ego was Libby, and Rumsfeld's second in command until recently was Wolfowitz. So both Cheney, the de facto president with an apparently ill perfused cerebrum, and the geezer commanding the Pentagon have been managed by younger and very prominent Straussians for the past five years.

A superb account of the ideas of Strauss, his followers and his influence is to be found in The Political Ideas of Leo Strauss (hereafter PI) and Leo Strauss and The American Right (hereafter AR), both by Shadia Drury, professor of politics at the University of Calgary. Her account of Strauss's ideas and the prominence they play in American politics today will give you chills or nausea, perhaps both. As she says in PI (p.xii), "Strauss is the key to understanding the political vision that has inspired the most powerful men in America under George W. Bush. In my view men who are in the grip of Straussian political ideas cannot be trusted with political power in any society, let alone a liberal democracy. This book explains why this is the case."

For those who wish to understand the neocon agenda, Drury's books are essential reading. She is clear and thorough.

Of pertinence to "Scooter's" case and the pack of lies he was concealing is Strauss's idea that a "philosopher elite" (i.e., Straussians) must rule. Moreover they must do so covertly. As someone remarked before last Friday, "Who ever heard of I. Lewis Libby?" a man who shunned the spotlight and operated behind the scenes. The reason for such covert rule, or cabal, is that the "vulgar" herd, as Strauss liked to call the rest of us, cannot appreciate "higher truths" such as the inevitability and necessity of wars in relations between states and even the utility of wars in governing a state.

So the covert elite must be certain that myths like religion or the glory of the nation are not weakened for these are among the best ways to rule over the ignorant herd and lead it into war. (Note that the Straussians themselves are not religious. They are "above" religion, capable of dealing with tough truths like man's mortality. But in their view, religion is a crucial factor in governing in their view. Irving Kristol, following Strauss, tells us that religion is "far more important politically" than the Founding Fathers believed and that to rescue America it is necessary "to breathe new life into the older, now largely comatose religious orthodoxies." (AR, p. 148). Any religion will do except perhaps Islam, which is more or less verboten, given the affinity of all leading neocons for Israel. Hence the neocons readily embrace the ideology and leadership of Christian fundamentalism which can keep the crowd under control and get them to march off to war and death. The neocons are mainly interested in foreign policy, as was Strauss, but in exchange for the support of the religious Right in foreign affairs, the neocons line up behind the domestic program of the fundamentalists. It's a win win situation, from their point of view

But useful lies of the grand sort like religious myth or blind nationalism need support by lesser lies at crucial moments. And so we go to the "smaller" lies like "weapons of mass destruction," the "smoking gun that comes in the form of the mushroom cloud." And here too the elite has a role to play. They are to use their "superior rhetorical skills" to make the weak argument seem stronger. In other words the cabal not only has to protect myths and manufacture lies but go to work in selling them. What Strauss called "rhetoric," we call spin.

All of this comes down to one word: lying. But for Strauss, these lies are necessary for the smooth function of society and triumph of one's own nation in war. Hence for Strauss, the lie becomes "noble." This phrase Strauss borrows and distorts from Plato who meant by a "noble lie" a myth or parable that conveyed an underlying truth about morality or nature. But in Strauss's hands the "noble lie" becomes a way of deceiving the herd. Strauss's "noble lies are far from "noble." They are intended to "dupe the multitude and secure power for a special elite" (AR, p. 79).

One other idea of Strauss's bears on the situation of "Scooter" Libby. How is the Straussian philosophical elite going to get from the halls of academe to the corridors of power? This depends on good luck and the "chance" encounter between the powerful and the Straussian. Here the contemporary neocons go beyond Strauss and leave nothing to chance. It would even appear that they look for the stupid, gullible or those who are mentally compromised. So William Kristol becomes Vice President Quayle's chief of Staff, and Libby becomes the right hand man to the addled Cheney as well as assistant to the Quayle-like Bush. And there are many more.

Finally, Drury makes the point the Strauss and the neocons are not really conservative at all. They are radicals, at war with the entire modern enterprise which makes them turn to the ancients for their inspiration and even there they need to distort the teachings of Socrates or Plato to make their case. But the Enlightenment comes to us with the advance of science to which Strauss is also hostile. He says that he is not against science as such "but popularized science or the diffusion of scientific knowledge.Science must remain the preserve of a small minority; it must be kept secret from the common man" (PI, p. 154). But this is impossible. Science by its very nature is a vast social enterprise requiring the widest possible dissemination of its findings. Any society that puts a lid on this will fail, and so by natural selection, the Straussian project is doomed to fail.

But before that happens the Straussians can do a lot of damage. As Drury says, they "cannot be trusted with political power." But we can learn from them the importance of boldness, not in the pursuit of the "noble lie" but of the truth. And we must be certain that we are vigorous as we hunt them down and get them out of power. In that effort Shadia Drury has done us a great service.

John Walsh can be reached at jvwalshmd@gmail.com.

He thanks Gary Leupp a regular on CounterPoint.com for pointing him to Shadia Drury's books.

[Feb 03, 2016] The Gloating of the Neocons

Notable quotes:
"... The greatest crime of the twenty-first century so far was the U.S. invasion and occupation of Iraq. ..."
"... First Bush and Cheney (and Rumsfeld and Wolfowitz and Rice) made the decision to go to war. Then they sat down and carefully invented the reasons ..."
"... On Sept. 11, 2001 Bush asked his counterterrorism advisor Richard A. Clarke, who had warned him in early 2001 about an "immanent al-Qaeda threat" (warnings Clarke alleges Bush "ignored") to produce a report blaming Iraq for the attacks on the Twin Towers and the Pentagon. ..."
"... In his own account Clarke says: "I said, Mr. President. We've done this before." (Meaning, we've explored the possibility of ties between Baghdad and al-Qaeda before.) "We have been looking at this. We looked at it with an open mind. There is no connection." ..."
"... Meanwhile Secretary of "Defense" Donald Rumsfeld advocated - from day one - attacks on Iraq as a response to 9/11. Clarke has stated that he assumed Rumsfeld was joking when he first suggested, immediately after the event, that since Afghanistan had "no good targets" the U.S. should proceed to bomb the totally un-related country. But he soon learned that Rumsfeld and his staff headed by Paul Wolfowitz were in deadly earnest. ..."
"... Some are describing Obama's renewed bombing of Iraq, and the strikes on Syrian targets, as a new "neocon moment." ..."
"... Recall how, in late 2003, as it became embarrassingly evident that Iraq had had no weapons of mass destruction, Wolfowitz in Iraq tried to change the subject entirely. Who cares about weapons of mass destruction? he told a reporter. The Iraqi people want to reconstruct their country, he declared (as though the question of the war's legitimacy was an irrelevant detail). Having acknowledged some "intelligence flaws" (attributing them to the CIA, rather than to themselves-despite what we know of the unprecedented Cheney-Libby visits to the Pentagon to browbeat the intelligence professionals to include their bullshit into official reports), Cheney and his neocon camp changed the subject. ..."
"... No, it wasn't about the announced reasons: weapons of mass destruction, or al-Qaeda ties. Nor was it about U.S. Big Oil (which hasn't profited from the Iraq War, the big contracts going to China and Russia). Nor was it about permanent military bases; the Iraqis have successfully rejected them. What does that leave us with? ..."
"... A war pushed by the neocons to destroy a foe of Israel. It succeeded, surely, but only to produce a vicious Sunni successor state in Anbar Province potentially far more threatening to Israel than Saddam ever was. ..."
October 31, 2014 | counterpunch.org

The greatest crime of the twenty-first century so far was the U.S. invasion and occupation of Iraq. Broadly conceived by George W. Bush and Dick Cheney immediately after 9/11, it initially lacked a coherent justification . But as Condoleezza Rice noted at the time, the tragedy brought "opportunities." (People in fear can be persuaded to support things policy-makers long wanted, but couldn't quite sell to the public.)

First Bush and Cheney (and Rumsfeld and Wolfowitz and Rice) made the decision to go to war. Then they sat down and carefully invented the reasons for their war.

On Sept. 11, 2001 Bush asked his counterterrorism advisor Richard A. Clarke, who had warned him in early 2001 about an "immanent al-Qaeda threat" (warnings Clarke alleges Bush "ignored") to produce a report blaming Iraq for the attacks on the Twin Towers and the Pentagon.

In his own account Clarke says: "I said, Mr. President. We've done this before." (Meaning, we've explored the possibility of ties between Baghdad and al-Qaeda before.) "We have been looking at this. We looked at it with an open mind. There is no connection."

But Clarke's recollection of the event continues:

"He came back at me and said, 'Iraq! Saddam! Find out if there's a connection.' And in a very intimidating way. I mean that we should come back with that answer. We wrote a report. It was a serious look. We got together all the FBI experts, all the CIA experts. We wrote the report. We sent the report out to CIA and found FBI and said, 'Will you sign this report?' They all cleared the report. And we sent it up to the president and it got bounced by the National Security Advisor or Deputy. It got bounced and sent back saying, 'Wrong answer. … Do it again.'"

Few policy decisions in modern history can rival the evil of that demand that the U.S. intelligence community deliberately contrive a false historical narrative, to justify a war that has destroyed a country and killed half a million people.

Meanwhile Secretary of "Defense" Donald Rumsfeld advocated - from day one - attacks on Iraq as a response to 9/11. Clarke has stated that he assumed Rumsfeld was joking when he first suggested, immediately after the event, that since Afghanistan had "no good targets" the U.S. should proceed to bomb the totally un-related country. But he soon learned that Rumsfeld and his staff headed by Paul Wolfowitz were in deadly earnest.

The Powell UN speech, demanding global support for an attack on a threatening, al-Qaeda aligned Iraq, in fact bombed. But more than that, key U.S. allies-NATO heavies France and Germany among them-refused to get on board the program. This occasioned an amazing campaign of vilification of France, best symbolized by Congress's decision to rename "French fries" "freedom fries" in the Congressional cafeteria. An asinine book trashing France as "our oldest enemy" became a best-seller.

... ... ...

Republican presidents, Democratic presidents. All on the same page when it comes to maintaining what Wolfowitz termed "full-spectrum dominance" in the post-Cold War world. Now as it all falls apart-as ISIL expands its "caliphate," as the Syrian Baathists hold out against both U.S.-backed and other Islamists, as Iran gains respect as a serious negotiator in the Geneva talks, as China rises, as Russia thwarts NATO expansion, as U.S.-Israeli ties fray, as a multi-polar world inevitably emerges- what triumphs can the neocons claim?

Once flushed with history, proclaiming the "end of history" with the triumph of capitalist imperialism over Marxist socialism and other competing ideologies, they have only a handful of successes they can claim.

Oilmen Rumsfeld, Cheney and Bush (and Rice who has an oil tanker named after her) lusted after oil profits. They lusted too for an expansion of U.S. military power in the "Greater Middle East." They were less concerned with Israel. But Israel's survival as a specifically "Jewish" state, with a subject Arab population that must never become demographically threatening-and blow the whole Zionist project by forcing a one-state multi-ethnic solution-is the central neocon concern. They will not say this, of course; Leo Strauss students like Wolfowitz and Shulsky believe in the need for deception to get things done. But this was the minimal objective of the neocons' response to 9/11: to use the event to advantage Israel.

Recall how, in late 2003, as it became embarrassingly evident that Iraq had had no weapons of mass destruction, Wolfowitz in Iraq tried to change the subject entirely. Who cares about weapons of mass destruction? he told a reporter. The Iraqi people want to reconstruct their country, he declared (as though the question of the war's legitimacy was an irrelevant detail). Having acknowledged some "intelligence flaws" (attributing them to the CIA, rather than to themselves-despite what we know of the unprecedented Cheney-Libby visits to the Pentagon to browbeat the intelligence professionals to include their bullshit into official reports), Cheney and his neocon camp changed the subject.

The real issue, they now averred, was creating "democracy" in the Middle East. Condi Rice happily connived with this strategy, arguing dramatically that it was as wrong to deny people in the Middle East their freedom as it had been to deny black people in her home of Birmingham, Alabama their right to vote. Suddenly special diplomats were dispatched to Arab countries to lecture skeptical, sometimes glowering audiences on the advantages of the U.S. political system.

Under great pressure, some Arab countries somewhat expanded their parliamentary processes. The effort backfired as Islamists were elected in Egypt, Hizbollah made advances in Lebanon, and Hamas won a majority in the first free Palestinian election (in 2006). The "terrorists" were winning elections! The State Department denounced such results and has since shut up about "democracy" in the Middle East.

No, it wasn't about the announced reasons: weapons of mass destruction, or al-Qaeda ties. Nor was it about U.S. Big Oil (which hasn't profited from the Iraq War, the big contracts going to China and Russia). Nor was it about permanent military bases; the Iraqis have successfully rejected them. What does that leave us with?

A war pushed by the neocons to destroy a foe of Israel. It succeeded, surely, but only to produce a vicious Sunni successor state in Anbar Province potentially far more threatening to Israel than Saddam ever was.

But Binyamin Netanyahu doesn't see it that way. He has repeatedly dubbed Iran as a greater threat than ISIL. Having predicted since 1992 that Iran is close to developing a nuclear bomb; having repeatedly demanded (echoed by prominent U.S. neocons such as Norman Podhoretz) that the U.S. bomb Iran (to prevent a "nuclear holocaust"); having angrily dismissed U.S. intelligence assessments that Iran has no nuclear weapons program, Netanyahu wants Obama to focus on destroying the Iranian regime.

GARY LEUPP is Professor of History at Tufts University, and holds a secondary appointment in the Department of Religion.

[Feb 03, 2016] Neoconservatives as neoliberals with a gun

Notable quotes:
"... In short, unless the semi-free democratic society is strong, and not only ready to defend itself but also willing to go on the offensive in support of its system abroad, it will perish. The neocon view is that either you're willing to export liberal democracy or it will be crushed by all kinds of barbaric global groups. ..."
"... They too believe – some of them because they were taught it by Strauss Co – that their most important values are best advanced and preserved in a relatively free society, provided such a society is strong and wields power wisely, both at home and abroad." ..."
"... The failure of the Weimar regime to prevent the rise of fascism, in his view, resided in its failure to put power into the hands of the strong and good, who inevitably, unable to acquire popular support through honest methods, should (like their Nazi adversaries) have cleverly used Big Lies (towards good ends) to nudge the people towards those ends. Only wise men, acting in secrecy, can do that. ..."
"... As Hersh points out, the neocons (just about a dozen officials-including Wolfowitz, Perle, Feith, Bolton, Abrams - operating in concert with the oil-baron contingent in the administration-Rumsfeld, Cheney, Rice, Bush-and providing them with intellectual guidance) refer to themselves (with smug amusement) as a "cabal" (a word with an interesting etymology). ..."
"... That seizure is still in progress, messily, untidily, brutally and illegally, and with results no cabal, however wise, can really predict. Among the results might be a growing revulsion among the American people themselves at the neocons' misanthropic arrogance, and perhaps (much though it should be regretted and fought) anti-Semitism. ..."
peakoilbarrel.com
R Walter, 02/03/2016 at 6:43 pm
Neoconservatives follow the philosophy of Leo Strauss, the father of the neoconservative movement. Whether is has been bad or good, hard to know. A little bit and a good read about the neoconservatives and Leo Strauss:

"Neoconservatives hold the view that 'American' is the best bet for the world – America's institutional set-up is a very useful combination of modern elements, having to do with the sovereignty of individuals together with the older idea of a substantial role for government – and that this is an idea that needs to be widely promulgated. Indeed, without its promulgation there can arise and persist major threats to the countries which do embrace this set up, such as the United States of America. In short, unless the semi-free democratic society is strong, and not only ready to defend itself but also willing to go on the offensive in support of its system abroad, it will perish. The neocon view is that either you're willing to export liberal democracy or it will be crushed by all kinds of barbaric global groups.

Now let us return to Strauss. Recall his prudential endorsement of classical liberalism as the best bet for philosophy. (Just exactly why philosophy ought to be cherished is not made clear by Strauss & Co; and their implicit or explicit nihilism calls the merit of philosophy into serious question.) Strauss's embrace of classical liberalism – or at least a watered down version of it, as per liberal democracy – did appear to influence the neocons. They too believe – some of them because they were taught it by Strauss & Co – that their most important values are best advanced and preserved in a relatively free society, provided such a society is strong and wields power wisely, both at home and abroad."

https://philosophynow.org/issues/59/Leo_Strauss_Neoconservative

For what it's worth.

likbez, 02/03/2016 at 7:16 pm
"Neoconservatives follow the philosophy of Leo Strauss, the father of the neoconservative movement."

No. They follow the philosophy of Leo Trotsky with "proletariat" replaced by "international elite" and global corporations.
http://softpanorama.org/Skeptics/Political_skeptic/neocons.shtml

Neoconservatives are neoliberals with a gun, changing Al Capone maxim into "You can get much farther with a neoliberal recommendations and a gun than you can with a neoliberal recommendation (as in Washington consensus) alone." Kind of attack dogs of neoliberalism.

Using deception as a smoke screen in politics was actually introduced by Machiavelli, not by Leo Strauss; that's why Bush II administration was called Mayberry Machiavelli (https://en.wikipedia.org/wiki/Mayberry_Machiavelli)

What Leo Strauss introduced and what is used in neoconservative/neoliberal discourse is the concept of "noble lie" (which includes "false flag" operations; https://en.wikipedia.org/wiki/False_flag). Here is how Professor of History at Tufts University Gary Leupp defines their behavior:

== quote ==
Hersh notes the critical influence of the philosopher Leo Strauss (d. 1973) on Wolfowitz's thinking. His article stimulated, among other articles, a substantial piece on Strauss by Jeet Heer in the Boston Globe (May 11), and another by William Pfaff in the International Herald Tribune (May 15), the latter noting that "Strauss's thought is a matter of public interest because his followers are in charge of U.S. foreign policy." Strauss, of German Jewish origins who taught for many years at the University of Chicago, mentoring Wolfowitz among others, was a brilliant man. No question about that. But also a man profoundly hostile to the modern world and to the concept of rule by the people. He believed it was the natural right of the wise and strong to lead societies to the fulfillment of their wise aims, using subterfuge when necessary, because speaking the naked truth won't get the job done.

Strauss's point of departure is Socrates, who in Plato's Republic denounces Athenian democracy (the rule of the untutored masses) and instead promotes government by "philosopher-kings." Strauss had experienced the Weimar Republic (one of the more democratic experiments in modern history) and seen Germany fall into the hands of the Nazis. He understandably opposed the latter, but he derived some lessons from their methodology.

The failure of the Weimar regime to prevent the rise of fascism, in his view, resided in its failure to put power into the hands of the strong and good, who inevitably, unable to acquire popular support through honest methods, should (like their Nazi adversaries) have cleverly used Big Lies (towards good ends) to nudge the people towards those ends. Only wise men, acting in secrecy, can do that.

As Hersh points out, the neocons (just about a dozen officials-including Wolfowitz, Perle, Feith, Bolton, Abrams - operating in concert with the oil-baron contingent in the administration-Rumsfeld, Cheney, Rice, Bush-and providing them with intellectual guidance) refer to themselves (with smug amusement) as a "cabal" (a word with an interesting etymology).

They have contempt for the masses, and feel utterly justified in wisely misleading those masses into a roadmap for global peace on their terms. That meant, initially, using 9-11 to produce support for the seizure of Iraq,

That seizure is still in progress, messily, untidily, brutally and illegally, and with results no cabal, however wise, can really predict. Among the results might be a growing revulsion among the American people themselves at the neocons' misanthropic arrogance, and perhaps (much though it should be regretted and fought) anti-Semitism. The latter might be provoked by the fact that persons inclined to embrace the most extreme factions in the Israeli political apparatus are disproportionately represented in the neocons' cabal, and while the general movement of U.S. foreign policy is driven by broad geopolitical concerns, rather than the alliance with Israel, the neocons' allegiance to what they perceive to be the interests of Sharon's Israel is highly conspicuous.
== end of quote ==

See also

http://www.counterpunch.org/2014/10/31/the-gloating-of-the-neocons/

[Jan 31, 2016] Jesses Café Américain Deep State Inside Washingtons Shadowy Power Elite

Notable quotes:
"... But, like virtually every employed person, I became, to some extent, assimilated into the culture of the institution I worked for, and only by slow degrees, starting before the invasion of Iraq, did I begin fundamentally to question the reasons of state that motivate the people who are, to quote George W. Bush, the deciders. ..."
"... Cultural assimilation is partly a matter of what psychologist Irving L. Janis called groupthink , the chameleon-like ability of people to adopt the views of their superiors and peers. This syndrome is endemic to Washington: The town is characterized by sudden fads, be it negotiating biennial budgeting, making grand bargains or invading countries. Then, after a while, all the towns cool kids drop those ideas as if they were radioactive. ..."
"... As in the military, everybody has to get on board with the mission, and questioning it is not a career-enhancing move. The universe of people who will critically examine the goings-on at the institutions they work for is always going to be a small one. As Upton Sinclair said, It is difficult to get a man to understand something when his salary depends upon his not understanding it. ..."
jessescrossroadscafe.blogspot.com
"Our plutocracy, whether the hedge fund managers in Greenwich, Connecticut, or the Internet moguls in Palo Alto, now lives like the British did in colonial India: ruling the place but not of it. If one can afford private security, public safety is of no concern; to the person fortunate enough to own a Gulfstream jet, crumbling bridges cause less apprehension, and viable public transportation doesn't even compute. With private doctors on call and a chartered plane to get to the Mayo Clinic, why worry about Medicare?"

― Mike Lofgren, The Deep State: The Fall of the Constitution and the Rise of a Shadow Government

"Our analyses suggest that majorities of the American public actually have little influence over the policies our government adopts. Americans do enjoy many features central to democratic governance, such as regular elections, freedom of speech and association, and a widespread (if still contested) franchise.

But we believe that if policymaking is dominated by powerful business organizations and a small number of affluent Americans, then America's claims to being a democratic society are seriously threatened."

Martin Gilens and Benjamin I. Page, Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens, Princeton 2014

"As a congressional staff member for 28 years specializing in national security and possessing a top secret security clearance, I was at least on the fringes of the world I am describing, if neither totally in it by virtue of full membership nor of it by psychological disposition.

But, like virtually every employed person, I became, to some extent, assimilated into the culture of the institution I worked for, and only by slow degrees, starting before the invasion of Iraq, did I begin fundamentally to question the reasons of state that motivate the people who are, to quote George W. Bush, 'the deciders.'

Cultural assimilation is partly a matter of what psychologist Irving L. Janis called groupthink, the chameleon-like ability of people to adopt the views of their superiors and peers. This syndrome is endemic to Washington: The town is characterized by sudden fads, be it negotiating biennial budgeting, making grand bargains or invading countries. Then, after a while, all the town's cool kids drop those ideas as if they were radioactive.

As in the military, everybody has to get on board with the mission, and questioning it is not a career-enhancing move. The universe of people who will critically examine the goings-on at the institutions they work for is always going to be a small one. As Upton Sinclair said, 'It is difficult to get a man to understand something when his salary depends upon his not understanding it.'"

Mike Lofgren

[Jan 31, 2016] Deep State Inside Washingtons Shadowy Power Elite Zero Hedge

Notable quotes:
"... how is it that partisan gridlock has seemingly jammed up the gears (and funding sources) in Washington, yet the government has been unhindered in its ability to wage endless wars abroad, in the process turning America into a battlefield and its citizens into enemy combatants? ..."
"... The Washington Post ..."
"... Congressional Record ..."
"... Federal Register ..."
"... The Deep State runs everything in America since at least Nov 22, 1963. Kennedy promised to shatter the CIA into a thousand pieces and scatter it to the winds. Instead, the CIA shattered his brains into a thousand pieces. ..."
"... The Deep State is a troika of the Military Industrial Complex, Wall Street and the Spooks who spy on everyone. The NSA spies on the Supreme Court, Congress and the White House and you. ..."
"... The stunning implication of this passage is that NSA spying targets not only ordinary American citizens, but also Supreme Court justices, members of Congress and the White House itself. One could hardly ask for a more naked exposure of a police state. ..."
"... Essay: Anatomy of the Deep State ..."
"... There is the visible government situated around the Mall in Washington, and then there is another, more shadowy, more indefinable government that is not explained in Civics 101 or observable to tourists at the White House or the Capitol. The former is traditional Washington partisan politics: the tip of the iceberg that a public watching C-SPAN sees daily and which is theoretically controllable via elections. The subsurface part of the iceberg I shall call the Deep State, which operates according to its own compass heading regardless of who is formally in power. ..."
"... Who rules America? ..."
"... Congress and both of the major political parties serve as rubber stamps for the confluence of the military, the intelligence apparatus and Wall Street that really runs the country. The so-called Fourth Estate -the mass media-functions shamelessly as an arm of this ruling troika. ..."
"... The Deep State controls Wall Street? No, indeed. Wall Street controls the Deep State and makes its very existence possible. The Deep States job is to do Wall Streets dirty work, so Wall Street can continue to live off their tax and debt-peons from Arlington to Athens. ..."
"... it is kind of a chicken and egg thing, the way it could be posed either way. i go with the theory that any collection of people in the pursuit of similar goals will conspire (make deals) to collaborate, ah hem. ..."
"... Weve been taken over. Weve been co-opted. In place of the organic leadership has been placed these people who I call the servitors of empire. ..."
"... Thats a midpoint between servants and … the wielders of true power–the great Anglo-American families. ..."
"... Oligarchy , government by the few, especially despotic power exercised by a small and privileged group for corrupt or selfish purposes. Aristotle used the term oligarchia to designate the rule of the few when it was exercised not by the best but by bad men unjustly. ..."
"... the Deep State is no different than the Praetorian Guard in Rome, who basically ran the show for the last 200 years of the Roman Empire ..."
"... Eventually, the Praetorian Guard basically sold the Emperor position to the highest bidder. They became nothing but common thieves. The same thing is happening in the USA ..."
"... The Washington Post ..."
"... You must realize that most of these contract personnel are former military or civilian employees who have gone private in order to escape federal salary limits. They are still permanent, long-term employees of their departments, only outside the federal personnel system and paid a great deal more. They are the entrenched experts who cannot be replaced because there arent a whole lot of them in any particular area. ..."
"... Once such a person becomes entrenched, competitors are not welcome and alternative points of view are squashed. As a result, the U.S. Deep State perpetuates one of the most expensive and incompetent intelligence services in the world. ..."
www.zerohedge.com
As we previously concluded , for all intents and purposes, the nation is one national "emergency" away from having a full-fledged, unelected, authoritarian state emerge from the shadows. All it will take is the right event-another terrorist attack, perhaps, or a natural disaster-for such a regime to emerge from the shadows.

As unnerving as that prospect may be, however, it is the second shadow government, what former congressional staffer Mike Lofgren refers to as " the Deep State, which operates according to its own compass heading regardless of who is formally in power ," that poses the greater threat right now.

Consider this: how is it that partisan gridlock has seemingly jammed up the gears (and funding sources) in Washington, yet the government has been unhindered in its ability to wage endless wars abroad, in the process turning America into a battlefield and its citizens into enemy combatants?

The credit for such relentless, entrenched, profit-driven governance, according to Lofgren, goes to " another government concealed behind the one that is visible at either end of Pennsylvania Avenue , a hybrid entity of public and private institutions ruling the country according to consistent patterns in season and out, connected to, but only intermittently controlled by, the visible state whose leaders we choose."

This " state within a state " hides "mostly in plain sight, and its operators mainly act in the light of day," says Lofgren, and yet the "Deep State does not consist of the entire government."

Rather, Lofgren continues:

It is a hybrid of national security and law enforcement agencies : the Department of Defense, the Department of State, the Department of Homeland Security, the Central Intelligence Agency and the Justice Department. I also include the Department of the Treasury because of its jurisdiction over financial flows, its enforcement of international sanctions and its organic symbiosis with Wall Street.

All these agencies are coordinated by the Executive Office of the President via the National Security Council. Certain key areas of the judiciary belong to the Deep State, such as the Foreign Intelligence Surveillance Court, whose actions are mysterious even to most members of Congress. Also included are a handful of vital federal trial courts, such as the Eastern District of Virginia and the Southern District of Manhattan, where sensitive proceedings in national security cases are conducted.

The final government component (and possibly last in precedence among the formal branches of government established by the Constitution) is a kind of rump Congress consisting of the congressional leadership and some (but not all) of the members of the defense and intelligence committees. The rest of Congress, normally so fractious and partisan, is mostly only intermittently aware of the Deep State and when required usually submits to a few well-chosen words from the State's emissaries.

In an expose titled " Top Secret America ," The Washington Post revealed the private side of this shadow government, made up of 854,000 contract personnel with top-secret clearances, "a number greater than that of top-secret-cleared civilian employees of the government."

Reporting on the Post's findings, Lofgren points out :

These contractors now set the political and social tone of Washington, just as they are increasingly setting the direction of the country, but they are doing it quietly, their doings unrecorded in the Congressional Record or the Federal Register , and are rarely subject to congressional hearings…

The Deep State not only holds the nation's capital in thrall, but it also controls Wall Street ("which supplies the cash that keeps the political machine quiescent and operating as a diversionary marionette theater") and Silicon Valley.

As Lofgren concludes:

[T]he Deep State is so heavily entrenched, so well protected by surveillance, firepower, money and its ability to co-opt resistance that it is almost impervious to change … If there is anything the Deep State requires it is silent, uninterrupted cash flow and the confidence that things will go on as they have in the past. It is even willing to tolerate a degree of gridlock: Partisan mud wrestling over cultural issues may be a useful distraction from its agenda.

Remember this the next time you find yourselves mesmerized by the antics of the 2016 presidential candidates or drawn into a politicized debate over the machinations of Congress, the president or the judiciary: it's all intended to distract you from the fact that you have no authority and no rights in the face of the shadow governments.

seek

25+ years ago (fuck I'm getting old), there was a database on CD that did just that, put out by by what would be considered a conspiracy theory researcher, Daniel Brandt. It was called namebase, and you could pretty much look up any name mentioned in the news and play 7 degrees with it. Most of the times I played that game, the roads led back to the CIA, usually in just one hop. Even for seemingly petty local things, like utility commissioners or board members of local electric utilities.

There's similar research today on the commercial side -- google "interlocking directorates" and you'll quickly find there's a core corporate power elite.

I don't think I've ever seen someone combine the two. I suspect that's something that will get your Mercedes wrapped around a tree. Safe to say today, compared to 25 years ago, even though the internet is more pervasive and more information is available, there's actually less consolidation and research in this area than there was long ago, which in and of itself is kind of suspect.

The actual list, if someone compiled it, would be shockingly short. I doubt the key individuals would amount to more than a couple thousand.

SHRAGS Sun, 01/31/2016 - 02:07

Namebase is still there: http://www.namebase.org/n2search.html

Here's the interlocking directorship shortlist: http://www2.ucsc.edu/whorulesamerica/power_elite/interlocks_and_interact...

JustObserving

The Deep State runs everything in America since at least Nov 22, 1963. Kennedy promised to shatter the CIA into a thousand pieces and scatter it to the winds. Instead, the CIA shattered his brains into a thousand pieces.

The Deep State is a troika of the Military Industrial Complex, Wall Street and the Spooks who spy on everyone. The NSA spies on the Supreme Court, Congress and the White House and you.

The most extraordinary passage in the memo requires that the Israeli spooks "destroy upon recognition" any communication provided by the NSA "that is either to or from an official of the US government." It goes on to spell out that this includes "officials of the Executive Branch (including the White House, Cabinet Departments, and independent agencies); the US House of Representatives and Senate (members and staff); and the US Federal Court System (including, but not limited to, the Supreme Court)."

The stunning implication of this passage is that NSA spying targets not only ordinary American citizens, but also Supreme Court justices, members of Congress and the White House itself. One could hardly ask for a more naked exposure of a police state.

https://www.wsws.org/en/articles/2013/09/13/surv-s13.html

Essay: Anatomy of the Deep State

There is the visible government situated around the Mall in Washington, and then there is another, more shadowy, more indefinable government that is not explained in Civics 101 or observable to tourists at the White House or the Capitol. The former is traditional Washington partisan politics: the tip of the iceberg that a public watching C-SPAN sees daily and which is theoretically controllable via elections. The subsurface part of the iceberg I shall call the Deep State, which operates according to its own compass heading regardless of who is formally in power.

http://billmoyers.com/2014/02/21/anatomy-of-the-deep-state/

Who rules America?

The secret collaboration of the military, the intelligence and national security agencies, and gigantic corporations in the systematic and illegal surveillance of the American people reveals the true wielders of power in the United States. Telecommunications giants such as AT&T, Verizon and Sprint, and Internet companies such as Google, Microsoft, Facebook and Twitter, provide the military and the FBI and CIA with access to data on hundreds of millions of people that these state agencies have no legal right to possess.

Congress and both of the major political parties serve as rubber stamps for the confluence of the military, the intelligence apparatus and Wall Street that really runs the country. The so-called "Fourth Estate"-the mass media-functions shamelessly as an arm of this ruling troika.

https://www.wsws.org/en/articles/2013/06/10/pers-j10.html

Niall Of The Ni...

The Deep State controls Wall Street? No, indeed. Wall Street controls the Deep State and makes its very existence possible. The Deep State's job is to do Wall Street's dirty work, so Wall Street can continue to live off their tax and debt-peons from Arlington to Athens.

besnook

it is kind of a chicken and egg thing, the way it could be posed either way. i go with the theory that any collection of people in the pursuit of similar goals will conspire (make deals) to collaborate, ah hem.

bunnyswanson

UC Davis Professor Hamamoto Exposes the NWO

"The very fields that I helped to pioneer have been visited by the Rockefeller Foundation boys and the Gates Foundation," Hamamoto remarks concerning the subversion of genuine activist-oriented and propelled scholarship. "This is what happens. You do pioneering work, and then you get the knock on the door and the invitation to be brought in to the fold. Ethnic Studies and Asian American Studies in particular have had those visits. We've been taken over. We've been co-opted. In place of the organic leadership has been placed these people who I call the 'servitors of empire.'

"That's a midpoint between servants and … the wielders of true power–the great Anglo-American families."

"Now here is some meat:

""Concerning deep agendas involving modern eugenics, Hamamoto observes, "Just like I got to see more [students] coming in on psychotropic drugs, I've been able to see the greater feminization of the male population over the years. I wanted to ask questions why. It didn't take too long to figure out that the male species in the Western world and places like Japan and South Korea, and definitely Southeast Asia, are being purposely re-engineered into a new type of gender orientation. The university," Hamamoto continues, "has purposely come up with this whole LGBT intellectual, scholarly, and student services agenda to act as a smokescreen for a more fundamental and nefarious attempt to engage in a massive eugenics exercise in effecting human reproduction."

http://www.evilyoshida.com/thread-7197.html

MASTER OF UNIVERSE

UC Davis is the back door of the Central Intelligence Agency. And the CIA is, and always will be, my bitch. Frankly, the Deep State is bankrupt just like Wall Street, and the USA, and UC DAVIS, plus Professor homophobe Hamamoto, and the MIC.

wankers all.

James TraffiCan't

Walk Quietly and Carry a Big Stck! Theodore Roosevelt

Oligarchy , government by the few, especially despotic power exercised by a small and privileged group for corrupt or selfish purposes. Aristotle used the term oligarchia to designate the rule of the few when it was exercised not by the best but by bad men unjustly. Britannica.com
Father Thyme

A History of Bad Men.
www.youtube.com/watch?v=oolwsWexSzQ

flyonmywall

So the "Deep State" is no different than the Praetorian Guard in Rome, who basically ran the show for the last 200 years of the Roman Empire.

Notice how well that one worked out. Eventually, the Praetorian Guard basically sold the Emperor position to the highest bidder. They became nothing but common thieves. The same thing is happening in the USA.

The government makes "rules" which are enforced by the "enforcers", but the rules and the enforcers are nothing but common thieves. Look what happened to various Central and Latin American countries. 41 out of the top 50 most violent cities in the world are in Latin America. 4 are in the USA. More to come for sure.

Faeriedust

" The Washington Post revealed the private side of this shadow government, made up of 854,000 contract personnel with top-secret clearances, "a number greater than that of top-secret-cleared civilian employees of the government."

You must realize that most of these "contract personnel" are former military or civilian employees who have gone private in order to escape federal salary limits. They are still permanent, long-term employees of their departments, only outside the federal personnel system and paid a great deal more. They are the entrenched "experts" who cannot be replaced because there aren't a whole lot of them in any particular area.

Of course, because there are so few of them in any field, there is very limited control on their personal biases and self-interests, which are often highly skewed.

Once such a person becomes entrenched, competitors are not welcome and alternative points of view are squashed. As a result, the U.S. Deep State perpetuates one of the most expensive and incompetent intelligence services in the world.

[Jan 27, 2016] The Implications of Foreign Minister Lavrovs Snub of Victoria Nuland

naked capitalism
timbers, January 27, 2016 at 9:30 am

"…the US need not push Russia into a corner, market forces are doing that work far more efficiently."

I think you're confusing markets with the US government.

It is the fall in the price of oil in part caused by political decisions, and partly Obama's illegal economic sanctions on Russia and US lies and propaganda and regime change directed at Russia that are "efficiently" doing what they're doing.

Would be very surprised if Washington is successful with any of it's "market forces" regarding Russia because Russia knows if it loses this matchup in Syria and retreats, the part that comes next is it Uncle Sam funding ISIS like terrorists on Russian soil instead of Syria as it is now. And if Russia can free itself of Western economic orthodoxy and dump the dollar, it will never fear a falling Rubble so much ever again. Lets hope Putin orders a moving away of short term Russian dollar holdings, so that a deliberate Russian default sees the West lose more in lost Russian payments than it can seize in Russian assets held in their countries.

Then who would "market forces be efficiently working for"?

In broad simplified stroke, Russia is fighting on the side of the angels and US is the Darth Vader of the world. The U.N. has said we have the biggest refugee crisis since WWII and the refugees are all coming from nations the US is or has done regime change in. Aside for this meaning Obama is directly responsible for the suffering if tens of millions of families and deaths of hundreds of thousands, it also is producing maybe dangerous right wing political reactions in Europe.

The Russians are smart enough to know the difference between economic sanctions and military threats and US funded/promoted terrorism. I've watched their actions long enough to trust them to make sound, intelligent responses (though was disappointed Lavrov agreed to allow Obama&Co funded Al-qaeda like terrorists to be included as legitimate political opponents of Assad in the peace talks).

hidflect, January 27, 2016 at 6:56 am

Why the hell should he shake her hand? She's an ideological, irrational hate-monger who despises Russia. Kerry was an ass for bringing her along.

susan the other, January 27, 2016 at 1:58 pm

Kerry was probably disciplining her or rehabilitating her; there musts be a tempered new consensus at State. You're coming with me Vicki and you are going to behave like a rational, sincere diplomat because you've got some big fences to mend.

ltr, January 27, 2016 at 8:01 am

Victoria Nuland is a monstrous diplomat who has soufght to cause or caused untold harm in American-Russian relations. She reflected Hillary Clinton's thinking and evidently reflects John Kerry's and ultimately the President's thinking.

ltr, January 27, 2016 at 10:17 am

Correcting and adding:

Victoria Nuland is a monstrous diplomat who has sought to cause or caused untold harm in American-Russian relations. She reflected Hillary Clinton's thinking and evidently reflects John Kerry's and ultimately the President's thinking. (I could care less about the shaking or not shaking. Nuland's presence is a sign of disrespect to Russia and the Russians know that perfectly well. This post is needed and excellent.)

susan the other, January 27, 2016 at 2:08 pm

I think her presence and her humiliation (notice Kerry left the room) are the equivalent of an apology to Lavrov and Russia for her dingbat, destructive role in Ukraine.

McKillop, January 27, 2016 at 10:55 am

If Nuland and her posse are as instrumental in the devastation brought to Ukraine as reported then I think she deserves a damned good shaking.

RUKidding, January 27, 2016 at 11:05 am

Interesting, thanks. I think the article is worthy. I certainly could not blame Lavrov for snubbing this horrid excuse for a human being. The Kaganate of Nuland represents a portion of Obama's foreign policy and reflects what will be ahead should HRC win the election. The entire Kagan family should not be hired to do this work on behalf of "We the People," but there they are… doing their evil thing.

oho, January 27, 2016 at 11:06 am

Bill Kristol and David Brooks cries out wondering where all the conservatives have gone?

The answer is right there….Nuland, Kristol and Co. have driven the GOP base who are even mildly aware of foreign affairs to Trump's camp.

Gaylord, January 27, 2016 at 12:41 pm

Nuland was not even appropriately dressed for a diplomatic meeting IMO.

shinola, January 27, 2016 at 1:45 pm

I guess I'll never be a diplomat.

I would have spit on her (& I'm Amurkin)

Wat, January 27, 2016 at 2:24 pm

Perhaps Nuland thought Lavrov was a subject of some kind. She's probably too arrogant and stupid to figure it out, but she has now encountered a legitimate opponent. When the day of reckoning comes for her, she may learn what responsibility is.

[Jan 26, 2016] Saving the Banks and Fabulously Enriching a Few On the Back of the Real Economy

Notable quotes:
"... It has become a machine for transferring income, wealth, ownership, and power to the very top. This is not the new normal. This is financial corruption and the erosion of systemic integrity. Are there any markets that have not been shown to have been systematically manipulated, for years? This is just institutionalized looting. ..."
Jesse's Café Américain
"Give a small number of people the power to enrich themselves beyond everyone's wildest dreams, a philosophical rationale to explain all the damage they're causing, and they will not stop until they've run the world economy off a cliff."

Philipp Meyer

"Wall Street is not being made a scapegoat for this crisis: they really did this."

Michael Lewis

"My daughter asked me when she came home from school, "What's the financial crisis?" and I said, it's something that happens every five to seven years."

Jamie Dimon

"The greatest tragedy would be to accept the refrain that no one could have seen this coming, and thus nothing could have been done. If we accept this notion, it will happen again."

Financial Crisis Inquiry Commission (2009–2011)

The US has been in a cycle of bubbles, busts, and crashes since at least 1995, and more likely since Alan Greenspan became the Chairman of the Federal Reserve in August, 1987.

The cycle is the same, only the depth and duration seems to change in a continuing 'wash and rinse' of the public money and the real economy.

It has become a machine for transferring income, wealth, ownership, and power to the very top. This is not 'the new normal.' This is financial corruption and the erosion of systemic integrity. Are there any markets that have not been shown to have been systematically manipulated, for years? This is just institutionalized looting.

[Jan 26, 2016] Public Investment: has George Started listening to Economists?

Notable quotes:
"... The case for additional public investment is as strong in the UK (and Germany ) as it is in the US. Yet since 2010 it appeared the government thought otherwise. ..."
"... However since the election George Osborne seems to have had a change of heart. ... ..."
economistsview.typepad.com

Simon Wren-Lewis:

Public investment: has George started listening to economists?: I have in the past wondered just how large the majority among academic economists would be for additional public investment right now.

The economic case for investing when the cost of borrowing is so cheap (particularly when the government can issue 30 year fixed interest debt) is overwhelming. I had guessed the majority would be pretty large just by personal observation. Economists who are not known for their anti-austerity views, like Ken Rogoff, tend to support additional public investment.

Thanks to a piece by Mark Thoma I now have some evidence. His article is actually about ideological bias in economics, and is well worth reading on that account, but it uses results from the ChicagoBooth survey of leading US economists. I have used this survey's results on the impact of fiscal policy before, but they have asked a similar question about public investment. It is
"Because the US has underspent on new projects, maintenance, or both, the federal government has an opportunity to increase average incomes by spending more on roads, railways, bridges and airports."
Not one of the nearly 50 economists surveyed disagreed with this statement. What was interesting was that the economists were under no illusions that the political process in the US would be such that some bad projects would be undertaken as a result (see the follow-up question). Despite this, they still thought increasing investment would raise incomes.
The case for additional public investment is as strong in the UK (and Germany) as it is in the US. Yet since 2010 it appeared the government thought otherwise. ...
However since the election George Osborne seems to have had a change of heart. ...

[Jan 26, 2016] You Say You Want a Revolution?

Notable quotes:
"... In November, if you dont live in a battleground state, your vote will not tip the outcome...better to vote your conscience and register your disgust with the corrupt duopoly. ..."
"... Any president will need a staff and mostly, that will come from people working in the Obama administration. Bernie talks about Stiglitz, but he is 72, almost as old as Bernie. He mentioned Reich who was part of the same Clinton administration that Bernie constantly bashes. ..."
"... Much of the dereg came about in trade for other policies. I dont know that a Bernie administration would be much different. Bernie would need to swallow hard and take a heavy dose of GOP poison to get a budget, much less pass reform legislation. ..."
"... Dont say the Tea Party changed nothing - they changed themselves. Remember that they were created in disgust over Wall Street. After they got elected you would be hard pressed to find more ardent supporters of any and all legislation that support the rich. ..."
"... Bernie is settling for social democracy. That is still better than neoliberal theocracy. ..."
"... Exactly. Its all political posturing for the primaries. Like Obama, shell revert to a neoliberal stooge the moment she takes office. ..."
"... Her first action will be to find some hapless, third world country to intervene in to prove that she has cojones. Libya redux. ..."
"... Paleoconservatives oppose military interventionism. Boots on the ground would be neoconservative. ..."
"... Neoconservative is just neoliberal with a more aggressive boots on the ground foreign policy or imperialism ..."
"... Paleoconservatives are more isolationist than free traders. They still love their corporations and rich people, but they dont like crony capitalism as a principle even if as a reality they are open to setting a price. Trump is leaning paleoconservative, at least in his campaign rhetoric. ..."
"... Whatever it takes to prove that she the toughest warrior since Catherine the Great... ..."
"... Exactly. She is yet another neocon, masking as a Democrat. She is more jingoistic then probably half of Republican candidates. ..."
"... What to do when a candidate is called unelectable because of their support for the policies that you yourself support? ..."
"... Well you have to decide whether you want to be a heroic loser or get half a loaf. I agree that it is a very difficult question. ..."
"... You nailed it. No one ever said democracy would be easy. ..."
"... And he cautionary tale is that the heroic losers got us 8 years of Bush II - and all the disasters he managed to create in that time. ..."
"... No What is means is that there are a lot of people who realize that public opinion polls mean absolutely nothing. ..."
"... What is ironic about this election cycle more than others is that Republicans dominate the elected offices, so they have essentially total control of government, especially in the poorest States, but they blame Obama for things that are local to these States like teen pregnancy, school drop outs, poverty, high unemployment, crime, felons, unemployed felons, no health providers, no corporations who will setup in the State because of the lack of health probiders, educated workers, and too much crime. Nothing was better when Bush-Cheney or Reagan-Bush were where Obama-Biden are. And the increasing number of elected Republicans seems to me to be quantifiably worse. ..."
"... I would call them a Third Way turncoats within Dems. Neolibs moved party into Wall Street hands and Wall Street donors became the key contributors. Clinton successfully sold Democratic Party (like Tony Blair sold Labour) and got rich in the process. ..."
"... Instead of boycotting, which conveys apathy, why not vote third party, which conveys disgust? ..."
"... ...Nader won enough votes in two states - Florida and New Hampshire - to put either of them in Gore's column. Nader won 97,488 votes in Florida, which easily could have swung the election to give Gore the state's 25 electoral votes, and there would have been no need for a recount. Even without Florida, adding Nader's 4 percent of the New Hampshire vote to Gore's 47 percent would have given Gore a 270 to 267 victory in the electoral college... ..."
"... Hillary Clinton has had persistently high negatives and a habit of generating and attractive scandal. She cant even generate trust within her own party, and performs particularly badly among independents. I dont understand why anyone would view her as the electable alternative . ..."
"... HRC is not calling for a political revolution. If you like oligarchy then she is your gal. If one is comfortably placed in the existing establishment then it is a scary thing to risk rocking the boat. ..."
"... Yep, the Clinton Foundation should be rebranded: Scandals R Us! ..."
"... When presented with the choice between a corrupt capitalist and an honest socialist, it should be an easy choice for most of us. Actually, for the Wall Street Democrats here, its also any easy choice--you look for the most corrupt candidate, the one who lists Wall Street banks as her top donors. ..."
"... By November, all but the most fervent Clinton partisans -- who can always be driven into a frenzy of paranoid persecution mania by talk of the Vast Right Wing Conspiracy and whatnot - is in an anybody but Clinton mood. ..."
"... Not BS. You are wearing partisan blinders. Clinton has been dogged by scandal at every stage of her public life: some pumped up out of relatively small stuff, but several serious big deals. There will be more. Why? Because the Clintons are both compulsive liars. Thats why young people, who are very good at sniffing out fakes and liars, dont like her. ..."
"... The Republicans have gone nuts and are much more of danger than they appeared to be back in 2000 before 9-11. ..."
"... The definitions of Democratic Socialism by B Sanders are in the context of Scandinavian countries which is really a more progressive form of social democracy, e.g. higher tax rates on higher earners than other social democratic countries but still allowing private property. ..."
"... The protesters' indictment of Wall Street as a destructive force, economically and politically, is completely right. ..."
"... Bingo. Bernie does what Obama did in his early speeches: speak to the moral, emotional underpinnings of Progressive beliefs. ..."
"... This is a kind of excitement that Hillary is never going to be able to inspire. ..."
"... And you somehow think that this enthusiasm will not be curbed after the attacks on Sanders begin? And I am not talking about these stupid little so called attacks by PK, Chait, Klein, etc. I'm talking big boy attacks backed by huge money and no reason whatsoever to pay attention to any facts at all. ..."
"... Yeah, I do. I think we're ready for another, And I welcome their hatred, moment in history. ..."
"... But what we need now is someone with genuine moral outrage who will say what so many of us feel: the system has been distorted beyond its ability to snap back. It works for at most 10% of the population now and catastrophically, often fatally, fails a percentage of perhaps twice that. I haven't gotten quite to the point yet myself where I would refuse to vote for Clinton if she won the primary, but many of my friends have. I think the tide has finally turned. ..."
economistsview.typepad.com
New column:
You Say You Want a Revolution?, by Mark A. Thoma : What, exactly, does Democratic presidential candidate Bernie Sanders have in mind when he asks on his website if we are "Ready to Start a Political Revolution?" He has proclaimed unabashedly that he is a socialist, a statement that has raised eyebrows about his electability. He wants to turn us into the Soviet Union!! Is that what he has in mind?
Far from it. He has qualified his statements to make it clear that he is a democratic socialist, but that term fails to convey what he really has in mind, or at least I think it does. ...

Posted on Tuesday, January 26, 2016 at 05:02 AM in Economics , Politics | Permalink Comments (96)

mulp -> pgl...
You support Sanders because he opposes any organized opposition to Republicans who run about 10,000 candidates for 10,000 offices and get out voters to vote in everyone on of those elections?

The only organized opposition to Republicans is Democratic Parties who need to raise money to pay campaign workers because those progressives who oppose capitalism oddly won't work for the parties for free, or run for office paying their own way in getting hundreds of people to work for free getting out the vote. It isn't like Democratic party elites block them from running for office because at least a thousand elections have no opponent to the Republican candidate.

What's Sanders' plan for filling the 10,000 elected offices currently filled with corrupt party picked and corporate bought puppets?

ilsm -> mulp ...
Sanders has pushed the DLC for a "southern strategy", to no avail. I worked for free in 2012 and 2014! I may not do so in 2016.
JohnH -> pgl...
I would vote for Sanders in November because he is strong on issues important to most Americans. Bill Curry explains the difference between the candidates, something most of the 'liberals' here fail to grasp--

"Hillary is a living avatar of the Democratic Party in our time. What it does well–cultural issues and social programs– she does well. When she talks about child care or family leave she's passionate and sincere. What she and her party don't do well is fight to end corporate control of government. She's also weak on climate change, freedom of information, the right to privacy and, in matters of alleged national security, the rule of law.

Bernie won [the October debate] not because he outpointed her but because he's strong on the issues on which she's weak - and because those are the issues that matter most to voters. Like our environment, our democracy and our middle class are at a tipping point. When Bernie talks about these crises, his sincerity and passion are unmistakable. For all her hard work, it isn't clear Hillary even understands them. Having spent the '90s promoting globalization, and her adult life raising money from those who profit from it, she's too wed to the system to see its fatal flaws".
http://www.salon.com/2015/10/18/this_is_still_bernie_sanders_moment_hes_right_on_the_big_issues_now_he_must_communicate_it/

likbez -> JohnH...
Bill Curry is simply naïve.

The current social system that is in place in the USA is called neoliberalism. And it presupposes complete corporate control of the state as neoliberalism is a form of corporatism.

I doubt that you can change the elite preferences as for neoliberalism via elections. Some compromises are possible, but that's it. Any US President is controlled by "deep state" not the other way around.

Truman said something like "You came to the office, you try to change things and nothing changes."

JohnH -> lower middle class...
In November, if you don't live in a battleground state, your vote will not tip the outcome...better to vote your conscience and register your disgust with the corrupt duopoly.
JohnH -> EMichael...
If enough people vote against the corrupt duopoly in non-battleground states, the message will be heard.

Yes, we can!

Sarah -> pgl...
As usual, Mark's much more balanced on the subject than Krugman. He shows that he's thought about it carefully and listened to what Sanders has to say. Krugman, on the other hand, is sounding like he did on the housing bubble before he actually started reading, thinking and paying attention.

Especially irritating is his claim that single payer means organizing a national health service and abolishing private health care. Surely he's traveled enough in Europe to know that it means nothing of the kind. Most European countries, including the one where I live, offer private health plans as well as a public option- just the system Krugman himself proposed when the health care debates were on.

The other thing which Sanders is doing, and which an earlier Krugman faulted Obama for NOT doing, is pushing the political dialogue back towards the center, away from the extreme right, where it's been stuck despite massive bipartisan majorities in favor of a number of more Progressive positions, for a couple of decades now. If he's getting strong blow-back for this it's hardly surprising.

I don't anyone will fault Thoma for worrying about Bernie's prospects. I happen to think he's mistaken, and that Sanders actually has a far stronger appeal - even on the Right (particularly among the non-political and those who have given up on politics) -- than many people suspect, but it's certainly a reasonable concern. What Krugman is doing goes considerably beyond that, however. If he's getting strong blow-back for that it's hardly surprising.

jonny bakho :
I think Bernie is electable. Bernie gives Hillary cover to discuss more populist positions. I think his approach is unlikely to deliver very much.

The TeaParty went to Congress with an agenda plus grass roots support and have changed nothing. The US system is designed to block radical schemes and force a more incremental change. On health care, we solved the problem of how to pay. The most pressing challenge is improving delivery. On this, Bernie is refighting the last war. His side lost. The Dems should not respond to TeaParty votes on repealing Obamacare with votes to repeal it and replace it with single payer. The TeaParty has been a waste of time. So would the push for single payer. The majority of Americans would be loathe to trade in their employer paid health care for health care of unknown quality paid for by higher taxes. Vermont could sell it to their voters. It cannot be sold to the TeaParty who would fight it as BigBrotherGov. Sanders does not have the good judgement to see that single payer is a loser with the general public and would be a drag on the rest of the agenda. The move to single payer will involve incremental steps that are outside of Sanders plan. The whole idea that a one-sided populist revolution will occur in 2016 is near zero probability. The populists are split between a conservative camp and a liberal camp.

Any president will need a staff and mostly, that will come from people working in the Obama administration. Bernie talks about Stiglitz, but he is 72, almost as old as Bernie. He mentioned Reich who was part of the same Clinton administration that Bernie constantly bashes. The advantage to Clinton is she is much more familiar with the players who understand how to make the agencies respond. I lived through the 90s and the legislation that was enacted was always some mix of what the GOP Congress were promoting and what Bill Clinton wanted. Much of the dereg came about in trade for other policies. I don't know that a Bernie administration would be much different. Bernie would need to swallow hard and take a heavy dose of GOP poison to get a budget, much less pass reform legislation.

ken melvin -> jonny bakho...
https://en.wikipedia.org/wiki/Statewide_opinion_polling_for_the_Democratic_Party_presidential_primaries,_2016
DeDude -> jonny bakho...
Don't say the Tea Party changed nothing - they changed themselves. Remember that they were created in disgust over Wall Street. After they got elected you would be hard pressed to find more ardent supporters of any and all legislation that support the rich.
pgl -> DeDude...
Same old Republican bait and switch.
ilsm -> jonny bakho...
Tea party support is in fly over country. And there a small minority (they win with 55% stay home) of the population.

Bernie could excite enough.... Hillary not so.

RC AKA Darryl, Ron :
My guess is that Bernie would be for democratic socialism if he thought that he could get it done. So, Bernie is settling for social democracy. That is still better than neoliberal theocracy.
RC AKA Darryl, Ron -> pgl...
I would even give some neoliberal politicians credit for listening well to the economists whose policy prescriptions fit their political-economic agenda on a case by case basis. So, that is pretense without just pretending.
JohnH -> RC AKA Darryl, Ron...
"Since Bernie she is singing a different tune."

Exactly. It's all political posturing for the primaries. Like Obama, she'll revert to a neoliberal stooge the moment she takes office.

Her first action will be to find some hapless, third world country to intervene in to prove that she has cojones. Libya redux.

RC AKA Darryl, Ron -> JohnH...
Yeah, but no boots on the ground because that would be neoconservative.
pgl -> RC AKA Darryl, Ron...
I think you mean Paleo Conservative. We need to program to keep up with all these meaningless labels.
Syaloch -> pgl...
Paleoconservatives oppose military interventionism. Boots on the ground would be neoconservative.


RC AKA Darryl, Ron -> pgl...

[Neoconservative is just neoliberal with a more aggressive "boots on the ground" foreign policy or imperialism if you would rather.]

*

https://en.wikipedia.org/wiki/Irving_Kristol

Irving Kristol (January 22, 1920 – September 18, 2009) was an American columnist, journalist, and writer who was dubbed the "godfather of neo-conservatism."

https://en.wikipedia.org/wiki/Neoconservatism

Neoconservatism (commonly shortened to neocon) is a political movement born in the United States during the 1960s among Democrats who became disenchanted with the party's domestic and especially foreign policy. Many of its adherents became politically famous during the Republican presidential administrations of the 1970s, 1980s, 1990s and 2000s. Neoconservatives peaked in influence during the administrations of George W. Bush and George H W Bush, when they played a major role in promoting and planning the 2003 invasion of Iraq.[1] Prominent neoconservatives in the Bush administration included Paul Wolfowitz, John Bolton, Elliott Abrams, Richard Perle, and Paul Bremer. Senior officials Vice President Dick Cheney and Secretary of Defense Donald Rumsfeld, while not identifying themselves as neoconservatives, listened closely to neoconservative advisers regarding foreign policy, especially the defense of Israel, the promotion of democracy in the Middle East, and the buildup of American military forces to achieve these goals. The neocons have influence in the Obama White House, and neoconservatism remains a staple in both parties' arsenal.[2][3]

The term "neoconservative" refers to those who made the ideological journey from the anti-Stalinist Left to the camp of American conservatism.[4] Neoconservatives typically advocate the promotion of democracy and promotion of American national interest in international affairs, including by means of military force, and are known for espousing disdain for communism and for political radicalism...

*

https://en.wikipedia.org/wiki/Paleoconservatism

Paleoconservatism (sometimes shortened to paleocon) is a conservative political philosophy found primarily in the United States stressing tradition, limited government and civil society, along with religious, regional, national and Western identity.[1][2]

Paleoconservatives in the 21st century often highlight their points of disagreement with neoconservatives, especially regarding issues such as military interventionism, illegal immigration and high rates of legal immigration, as well as multiculturalism, affirmative action, free trade, and foreign aid.[1] They also criticize social welfare and social democracy, which some refer to as the "therapeutic managerial state",[3] the "welfare-warfare state"[4] or "polite totalitarianism".[5] They identify themselves as the legitimate heirs to the American conservative tradition.[6]

Elizabethtown College professor Paul Gottfried is credited with coining the term in the 1980s.[7] He says the term originally referred to various Americans, such as conservative and traditionalist Catholics and agrarian Southerners, who turned to anti-communism during the Cold War.[8] Paleoconservatism is closely linked with distributism.[citation needed]

Paleoconservative thought has been published by the Rockford Institute's Chronicles: A Magazine of American Culture.[9] Politician Pat Buchanan was strongly influenced by its articles[8] and helped create another paleocon publication, The American Conservative.[10] Its concerns overlap those of the Old Right that opposed the New Deal in the 1930s and 1940s...


[There you have it. To simplify just consider archetypes neoconservative Irving Kristol (or son William) versus paleoconservative Pat Buchanan. Neocons are entirely at home with the Washington Consensus of neoliberal, but they want to project American power via militarism and have no problem whatsoever with other peoples kids dying in foreign wars. That is the beauty of an all voluntary military.

Paleoconservatives are more isolationist than free traders. They still love their corporations and rich people, but they don't like crony capitalism as a principle even if as a reality they are open to setting a price. Trump is leaning paleoconservative, at least in his campaign rhetoric. ]

JohnH -> RC AKA Darryl, Ron...

"no boots on the ground" Don't bet on it. Whatever it takes to prove that she the toughest warrior since Catherine the Great...

likbez -> JohnH...
>Her first action will be to find some hapless, third world country to intervene in to prove that she has cojones. Libya redux.

Exactly. She is yet another neocon, masking as a Democrat. She is more jingoistic then probably half of Republican candidates.


PPaine -> RC AKA Darryl, Ron...

Might I suggest recently Hillary is no longer bear hugging real progress

She's back to the wooden nickel con and the " crazy left " marginalization stunt


RC AKA Darryl, Ron -> PPaine ...

Yeah, you may suggest. I noticed that too. Neither my wife nor I are her fans. I have been in for Bernie since before he even announced. If I recall so were you although Liz Warren would have also been acceptable to us.

Back in the 70's I wanted to Carl Sagan to run for POTUS. I have since become a full time realist and only a part time crackpot.


DrDick -> RC AKA Darryl, Ron...

That is the position of many Democratic Socialists, including myself and most major European socialist parties. It is a gradualist position rather than a revolutionary one.

PPaine said in reply to DrDick...

And deeply in crisis. Hence the emergence of left alternatives as well as right menaces

kthomas :
Let's go Bernie! Make those cockroaches scurry!
Jerry Brown :
What to do when a candidate is called unelectable because of their support for the policies that you yourself support?
RC AKA Darryl, Ron -> Jerry Brown...
LOL! That's a good one.
Jerry Brown -> EMichael...
True enough. Thoma says it is the label "socialist" that makes him less likely to win, not the actual policies that might be associated with the label.

Its difficult finding out I'm a socialist after all these years. Maybe I should support Trump so nobody else finds out.

Jerry Brown -> EMichael...
Yes. Trump might be a type of socialist too. Nationalist Socialist might be a fit for him.
DeDude -> Jerry Brown...
Well you have to decide whether you want to be a heroic loser or get half a loaf. I agree that it is a very difficult question.
RC AKA Darryl, Ron -> DeDude...
You nailed it. No one ever said democracy would be easy.
DeDude -> RC AKA Darryl, Ron...
And he cautionary tale is that the "heroic losers" got us 8 years of Bush II - and all the disasters he managed to create in that time.
JohnH -> Jerry Brown...
"What to do when a candidate is called unelectable because of their support for the policies that you yourself support?"

Actually, what to do when a candidate, i.e. Bernie, is called unelectable because they support policies that most Americans support--busting up the big banks and Medicare for all?

The 'liberals' here fail to take into account that 1) Bernie is on the right side of public opinion, and 2) takes positions that real liberals would support. Yet they won't support Bernie...because they've become too conservative?

EMichael -> JohnH...
No What is means is that there are a lot of people who realize that public opinion polls mean absolutely nothing.
mulp -> Jerry Brown...
You form a party that can put 10,000 candidates on the ballot for 10,000 elected offices and then winning the majority of those elections.

What is ironic about this election cycle more than others is that Republicans dominate the elected offices, so they have essentially total control of government, especially in the poorest States, but they blame Obama for things that are local to these States like teen pregnancy, school drop outs, poverty, high unemployment, crime, felons, unemployed felons, no health providers, no corporations who will setup in the State because of the lack of health probiders, educated workers, and too much crime. Nothing was better when Bush-Cheney or Reagan-Bush were where Obama-Biden are. And the increasing number of elected Republicans seems to me to be quantifiably worse.

So, who do progressives like Sanders blame? The Democrats who have lost in elections over and over to Republicans. What actions do progressives who support Sanders take? Attack the system and boycott it.

Hey, it's like protesting the weather requiring creating some sort of shelter from the snow by laying down and being covered with snow. They'll show mother nature and force her to change.

likbez -> PPaine ...

> Party cadre and those reflex rooters for the party

I would call them a Third Way turncoats within Dems. Neolibs moved party into Wall Street hands and Wall Street donors became the key contributors. Clinton successfully sold Democratic Party (like Tony Blair sold Labour) and got rich in the process.

JohnH -> mulp ...

Instead of boycotting, which conveys apathy, why not vote third party, which conveys disgust?

BTW the reason Democrats lost the mid-terms in many states in 2014 is precisely because they ran as Republican-lite: "Consider that in four "red" states - South Dakota, Arkansas, Alaska, and Nebraska - the same voters who sent Republicans to the Senate voted by wide margins to raise their state's minimum wage. Democratic candidates in these states barely mentioned the minimum wage."

JohnH -> djb...

What Bernie should do if he loses is build a nationwide socialist organization. Obama had that opportunity in 2008 but abandoned it as soon as he took power...he didn't want popular opposition to his neoliberal agenda.

RC AKA Darryl, Ron said in reply to DeDude...

[Sorry, I forgot about Nader and since you did not explicitly mention him then your meaning was not clear.]

https://www.washingtonpost.com/opinions/how-nader-cost-gore-an-election/2015/02/05/3261cc22-abd2-11e4-8876-460b1144cbc1_story.html

...Nader won enough votes in two states - Florida and New Hampshire - to put either of them in Gore's column. Nader won 97,488 votes in Florida, which easily could have swung the election to give Gore the state's 25 electoral votes, and there would have been no need for a recount. Even without Florida, adding Nader's 4 percent of the New Hampshire vote to Gore's 47 percent would have given Gore a 270 to 267 victory in the electoral college...

[That said, then Bernie is another thing entirely. Bernie is not a third party candidate. Now I wish voting for a third party candidate was plausibly a good decision because with a ranked voting system then a third party vote would not be a throw away, but that is not how the two party system wants things done.]

http://www.csmonitor.com/Business/Robert-Reich/2014/1112/The-real-reason-Democrats-lost-big-in-2014

Why vote for this corrupt duopoly?

Dan Kervick :
Hillary Clinton has had persistently high negatives and a habit of generating and attractive scandal. She can't even generate trust within her own party, and performs particularly badly among independents. I don't understand why anyone would view her as the "electable alternative".
RC AKA Darryl, Ron -> Dan Kervick ...
HRC is not calling for a political revolution. If you like oligarchy then she is your gal. If one is comfortably placed in the existing establishment then it is a scary thing to risk rocking the boat.
JohnH -> RC AKA Darryl, Ron...
Yep, the Clinton Foundation should be rebranded: "Scandals R Us!"

"Hillary Clinton Oversaw US Arms Deals to Clinton Foundation Donors"...just the tip of the iceberg.
http://www.motherjones.com/politics/2015/05/hillary-clinton-foundation-state-arms-deals

When presented with the choice between a corrupt capitalist and an honest socialist, it should be an easy choice for most of us. Actually, for the Wall Street Democrats here, it's also any easy choice--you look for the most corrupt candidate, the one who lists Wall Street banks as her top donors.

Dan Kervick -> EMichael...
Great, you can predict the future. Well, so can I. Here's my prediction: Hillary Clinton gets nominated. The summer and fall campaign is dominated by a nauseating replay of every Clinton scandal, present and past. Not just the eight or so we know about, but others that haven't been let out of the opposition research box yet. By November, all but the most fervent Clinton partisans -- who can always be driven into a frenzy of paranoid persecution mania by talk of the Vast Right Wing Conspiracy and whatnot - is in an "anybody but Clinton" mood.
Dan Kervick -> pgl...
Not BS. You are wearing partisan blinders. Clinton has been dogged by scandal at every stage of her public life: some pumped up out of relatively small stuff, but several serious big deals. There will be more. Why? Because the Clintons are both compulsive liars. That's why young people, who are very good at sniffing out fakes and liars, don't like her.

But the older, "Clinton generation" of Democrats has internalized a particularly cynical and jaded attitude toward routine public lying, having picked up the fixed habit of defending the compulsively lying Clintons for so many years.

The Clintons could have done the Democratic Party a huge favor in 2001 by sailing off into retirement after dragging the country through their slime for years, and by dismantling their machine and handing the party off to something more wholesome and progressive.

Syaloch -> Dan Kervick ...
Hey, some of us older folks are pretty good at sniffing out liars and fakes too.
Dan Kervick :
Many commentators don't seem to understand that there is a major US organization called the Democratic Socialists of America. They have been around for a number of years, and one of the founders was Michael Harrington. This organization has published a fairly comprehensive statement entitled Where We Stand, and does not advocate a wholesale elimination of market economic institutions.

http://www.dsausa.org/where_we_stand#dc

Rather, they say:

As democratic socialists we are committed to ensuring that any market is the servant of the public good and not its master. Liberty, equality, and solidarity will require not only democratic control over economic life, but also a progressively financed, decentralized, and quality public sector. Free markets or private charity cannot provide adequate public goods and services.

So, as I read it, the two main takeaways here are:

1. Any markets that exist should serve the public good.
2. Free markets alone are not sufficient to provide society with adequate public goods and services.

The statement also does not call for the elimination of all private ownership; but it clearly does call for an expansion of public ownership, worker ownership and cooperatives.

A lot of people who are not democratic socialists seem to have very strong ideas about what democratic socialism really is, based perhaps on the ideas of people who called themselves "democratic socialists" in the 19th and early 20th centuries. But I think it's the people who use that label for themselves are entitled to determine what they intend that label to stand for.

pgl -> Dan Kervick...

Love this line:

"Today powerful corporate and political elites tell us that environmental standards are too high, unemployment is too low, and workers earn too much for America to prosper in the next century."

Most economists would say environmental standards are too low, that we are still below full employment, and the goal of economic policy should be to raise wages.

So your group is critiquing right wing Republicans not your "neoliberal" whatever.

likbez -> pgl...

For those who studied Marxism neoliberalism can be defined as Trotskyism for the rich or "revolt of the elite" (against New Deal policies). http://softpanorama.org/Skeptics/Political_skeptic/Neoliberalism/neoliberalism_as_trotskyism_for_the_rich.shtml

Like Marxism Neoliberalism is not simply an economic theory, it is a philosophy that includes economic theory as its cornerstone.

Like Marxism Neoliberalism is not homogenous and consists of warring factions.

Right wing Republicans is just one faction of neoliberals. You can distinguish between soft neoliberals (Third Way neolibs) and hard neoliberals.

see

Peter K. :

I'm for Bernie and believe he could beat Trump. But Dan Kervick and JohnH's arguments moved me more towards the Thoma and EMichael direction.

The Republicans have gone nuts and are much more of danger than they appeared to be back in 2000 before 9-11.

The parties are not the same. The danger for the Democrats is that they don't accomplish enough in moving the country towards Social Democracy (Bill Clinton did little, Obama did some) and so inequality just increases and politics gets worse.

Obama did not get a strong recovery and so Congress is Republican. He didn't prioritize Fed nominations and turned towards deficit reduction too quickly.

EMichael -> Peter K....
There are two sides to that stone.

What I am saying, and in way so is Dr. Thoma, is that Sanders' nomination may well cause much more Rep voter turnout.

And Sanders lacks the ability to turn out the black vote at all, and he has done himself no favor so far in this cycle.

Black votes are a lot more important and numerous than any people who are tired of "neo-liberals". Most of whom, if they had IQ above double digits, always voted for the Dem candidate anyway.

am :
Prof Thoma seems to have got this right. The definitions of Democratic Socialism by B Sanders are in the context of Scandinavian countries which is really a more progressive form of social democracy, e.g. higher tax rates on higher earners than other social democratic countries but still allowing private property. But he was really a bit daft calling himself a democratic socialist if he is just a more progressive social democrat. A democratic socialist does not allow private property rights but allows democracy. This means elections every four or five years when the government including themselves in power can be changed.
But that these terms can be misunderstood you just have to look at their use in history: Union of Soviet Socialist Republics and the Democratic Republic of Germany (East Germany).

likbez -> am...

Scandinavian countries are pretty small homogenous countries. What is possible for Scandinavian countries is more difficult to achieve is large states like the USA.

> This means elections every four or five years when the government including themselves in power can be changed.

In two party system elections is just approval of two selected by the current oligarchy candidates. And it was always this way.

mulp -> likbez...
"In two party system elections is just approval of two selected by the current oligarchy candidates. And it was always this ways."

So, every candidate must independently find supporters and then use the supporters to educate every voter in the candidates' electorate of the individual candidates policies without respect to any standard like political party or any existing description of what political labels mean because the labels are derived from one of many parties using the words in the label.

How long would it take you to explain your political position without referring to some label that covers how you would decide on responses to social problems when drafting bills or voting on them?

Then explain how you would find other legislators to support and pass bills without assigning them labels.

likbez -> mulp... January 26, 2016 at 10:36 AM
I think two party system is what is called "polyarchy" -- power of a few. As Gore Vidal noted: "There is one political party in this country, and that is the party of money. It has two branches, the Republicans and the Democrats, the chief difference between which is that the Democrats are better at concealing their scorn for the average man."

http://www.softpanorama.org/Skeptics/Political_skeptic/Two_party_system_as_poliarchy/index.shtml

== quote ==
I subscribe to Kantian idea of the dignity in human, the idea that everyone is entitles to survival as well as thriving beyond survival. But does everybody is entitled to equal participation in ruling of the state ? Or election of state leaders? Which is what democracy means. But at the same time the struggle for political equality which is often associative with the word "democracy" is a vital human struggle even if democracy itself is an unachievable and unrealistic ideal (see The Iron Law of Oligarchy). In some sense too much talk about Democracy is very suspect and just characterize the speaker as a hypocrite with probably evil intentions, who probably is trying to mask some pretty insidious plans with "democracy promotion" smokescreen. That is especially true for "export of democracy" efforts. See color revolutions for details.

Under neoliberalism we now face a regime completely opposite to democracy: we have complete, forceful atomization of public, acute suppression of any countervailing political forces (not unlike it was the case in the USSR) including labor unions and other forms of self-organization for the lower 80% or even 99% of population. Neoliberalism tries to present any individual as a market actor within some abstract market (everything is the market under neoliberalism). Instead of fight for political and economic equality neoliberalism provides a slick slogan of "wealth maximization" which is in essence a "bait and switch" for wealth maximization for the top 1% (redistribution of wealth up - which is the stated goal of neoliberalism). It was working in tandem with "shareholder value" mantra which is a disguise of looting of the corporations to enrich its top brass via outsize bonuses (IBM is a nice example where such an approach leads) and sending thousands of white color workers to the street. Previously it was mainly blue-color workers that were affected. Times changed.

Everything should be organized like corporation under neoliberalism, including government, medicine, education, even military. And everybody is not a citizen but a shareholder under neoliberalism (or more correctly stakeholder), so any conflict should be resolved via discussion of the main stakeholders. Naturally lower 99% are not among them.

In any democracy, how can voters make an important decision unless they are well informed? But what percentage of US votes can be considered well informed? And what percentage is brainwashed or do not what to think about the issues involved and operate based on emotions and prejudices? And when serious discussion of issues that nation faces are deliberately and systematically replaced by "infotainment" votes became just pawn in the game of factions of elite, which sometimes leaks information to sway public opinion, but do it very selectively. Important information is suppressed or swiped under the carpet to fifth page in NYT to prevent any meaningful discussion. For example, ask several of your friends if they ever heard about Damascus, AR.

The great propaganda mantra of neoliberal governance, "wealth maximization" for society as a whole in reality is applied very selectively and never to the bottom 60% or 80% of population. In essence, it means a form of welfare economics for financial oligarchy while at the same time a useful smokescreen for keeping debt-slaves obedient by removing any remnants of job security mechanisms that were instituted during the New Deal. As the great American jurist and Supreme Court associate justice Louis Brandeis once said: "We can have huge wealth in the hands of a relatively few people or we can have a democracy. But we can't have both." As under neoliberalism extreme wealth is the goal of the social system, there can be no democracy under neoliberalism. And this mean that pretentions of the USA elite that the USA is a bastion of democracy is plain vanilla British ruling elite style hypocrisy. Brutal suppression of any move to challenge dominance of financial oligarchy (even such feeble as Occupy movement) shows that all too well
Politically neoliberalism. like Marxism in the past, operates with the same two classes: entrepreneurs (modern name for capitalists and financial oligarchy) and debt slaves (proletarians under Marxism) who work for them. Under neoliberalism only former considered first class citizens ("one dollar -- one vote"). Debt slaves are second class of citizens and are prevented from self-organization, which by-and-large deprives them of any form of political participation. In best Roman tradition it is substituted with the participation in political shows (see Empire of Illusion The End of Literacy and the Triumph of Spectacle by Chris Hedges) which decide nothing but provide legitimacy for ruling elite.

The two party system invented by the elite of Great Britain proved to be perfect for neoliberal regimes, which practice what Sheldon Wolin called inverted totalitarism. The latter is the regime in which all political power belongs to the financial oligarchy which rules via the deep state mechanisms, and where traditional political institutions are downgraded to instruments of providing political legitimacy of the ruling elite. Population is discouraged from political activity. "Go shopping" as famously stated Bush II after 9/11.

== end of quote ==

Syaloch said...

[Class Wars Episode VI: Return of the Occupiers]

http://www.nytimes.com/2011/10/07/opinion/krugman-confronting-the-malefactors.html

Confronting the Malefactors

By Paul Krugman | Oct. 6, 2011

There's something happening here. What it is ain't exactly clear, but we may, at long last, be seeing the rise of a popular movement that, unlike the Tea Party, is angry at the right people.

When the Occupy Wall Street protests began three weeks ago, most news organizations were derisive if they deigned to mention the events at all. For example, nine days into the protests, National Public Radio had provided no coverage whatsoever.

It is, therefore, a testament to the passion of those involved that the protests not only continued but grew, eventually becoming too big to ignore. With unions and a growing number of Democrats now expressing at least qualified support for the protesters, Occupy Wall Street is starting to look like an important event that might even eventually be seen as a turning point.

What can we say about the protests? First things first: The protesters' indictment of Wall Street as a destructive force, economically and politically, is completely right.

A weary cynicism, a belief that justice will never get served, has taken over much of our political debate - and, yes, I myself have sometimes succumbed. In the process, it has been easy to forget just how outrageous the story of our economic woes really is. So, in case you've forgotten, it was a play in three acts.

  1. In the first act, bankers took advantage of deregulation to run wild (and pay themselves princely sums), inflating huge bubbles through reckless lending.
  2. In the second act, the bubbles burst - but bankers were bailed out by taxpayers, with remarkably few strings attached, even as ordinary workers continued to suffer the consequences of the bankers' sins.
  3. And, in the third act, bankers showed their gratitude by turning on the people who had saved them, throwing their support - and the wealth they still possessed thanks to the bailouts - behind politicians who promised to keep their taxes low and dismantle the mild regulations erected in the aftermath of the crisis.

Now, it's true that some of the protesters are oddly dressed or have silly-sounding slogans, which is inevitable given the open character of the events. But so what? I, at least, am a lot more offended by the sight of exquisitely tailored plutocrats, who owe their continued wealth to government guarantees, whining that President Obama has said mean things about them than I am by the sight of ragtag young people denouncing consumerism.

Bear in mind, too, that experience has made it painfully clear that men in suits not only don't have any monopoly on wisdom, they have very little wisdom to offer. When talking heads on, say, CNBC mock the protesters as unserious, remember how many serious people assured us that there was no housing bubble, that Alan Greenspan was an oracle and that budget deficits would send interest rates soaring.

A better critique of the protests is the absence of specific policy demands. It would probably be helpful if protesters could agree on at least a few main policy changes they would like to see enacted. But we shouldn't make too much of the lack of specifics. It's clear what kinds of things the Occupy Wall Street demonstrators want, and it's really the job of policy intellectuals and politicians to fill in the details.

Rich Yeselson, a veteran organizer and historian of social movements, has suggested that debt relief for working Americans become a central plank of the protests. I'll second that, because such relief, in addition to serving economic justice, could do a lot to help the economy recover. I'd suggest that protesters also demand infrastructure investment - not more tax cuts - to help create jobs. Neither proposal is going to become law in the current political climate, but the whole point of the protests is to change that political climate.

And there are real political opportunities here. Not, of course, for today's Republicans, who instinctively side with those Theodore Roosevelt-dubbed "malefactors of great wealth." Mitt Romney, for example - who, by the way, probably pays less of his income in taxes than many middle-class Americans - was quick to condemn the protests as "class warfare."

But Democrats are being given what amounts to a second chance. The Obama administration squandered a lot of potential good will early on by adopting banker-friendly policies that failed to deliver economic recovery even as bankers repaid the favor by turning on the president. Now, however, Mr. Obama's party has a chance for a do-over. All it has to do is take these protests as seriously as they deserve to be taken.

And if the protests goad some politicians into doing what they should have been doing all along, Occupy Wall Street will have been a smashing success.

Sarah -> Peter K....

Bingo. Bernie does what Obama did in his early speeches: speak to the moral, emotional underpinnings of Progressive beliefs. Despite seeing how incredibly powerful this approach has been for the Republicans, we've had years and decades of Democrats acting like cold technocrats, as if all of these policy matters were mere practicalities and politics were really just the horse race that the media treats it as- rather than a matter of life and death for many people in its outcomes.

I think people would be less skeptical of Bernie's chances if they saw, as I have, the number of people on the Right and the completely apolitical types who've never voted in their lives who are suddenly talking enthusiastically (often to their own surprise) about a politician. This is a kind of excitement that Hillary is never going to be able to inspire.

EMichael -> Sarah...

And you somehow think that this enthusiasm will not be curbed after the attacks on Sanders begin? And I am not talking about these stupid little so called "attacks" by PK, Chait, Klein, etc. I'm talking big boy attacks backed by huge money and no reason whatsoever to pay attention to any facts at all.

Sarah -> EMichael...

Yeah, I do. I think we're ready for another, "And I welcome their hatred," moment in history.

The fact is, on both the Left and the Right people are sick of politics as usual. It's notable that the 'big boys' with the money have been completely, totally unable to influence their supposed Republican base this election season. That's because on the Republican side Trump and Cruz- and even Carson- are tapping into real grievances and emotions. Do you really think Hillary Clinton is the right person to tap into that current? It's a pity, actually. I like her quite well, and I supported her against Obama because of Obama's relative inexperience - and the fact that he hadn't been 'tested' by the 'big boy attacks' you refer to.

But what we need now is someone with genuine moral outrage who will say what so many of us feel: the system has been distorted beyond its ability to snap back. It works for at most 10% of the population now and catastrophically, often fatally, fails a percentage of perhaps twice that. I haven't gotten quite to the point yet myself where I would refuse to vote for Clinton if she won the primary, but many of my friends have. I think the tide has finally turned.

EMichael -> Sarah...

I'm with you except I think the math does not work.

Half of the REP base are stone cold crazy, and when the smoke clears they will vote for whomever is left standing.

This country has no such amount of people who are as far left as it does those who are far right. And what numbers there are do not got to the polls if their candidate loses the nomination.

Sarah -> EMichael...

The thing is, the 'math' doesn't take into account the incredibly low voter turnouts in the US. It wouldn't take a whole lot to create massive change if you could engage even a quarter of the currently unengaged. What impresses me about Bernie is that he seems to be able to do so.

[Jan 25, 2016] Congress is Writing the President a Blank Check for War

Notable quotes:
"... The senior Senator from Kentucky is scheming, along with Sen. Lindsey Graham, to bypass normal Senate procedure to fast-track legislation to grant the president the authority to wage unlimited war for as long as he or his successors may wish. ..."
"... The legislation makes the unconstitutional Iraq War authorization of 2002 look like a walk in the park. It will allow this president and future presidents to wage war against ISIS without restrictions on time, geographic scope, or the use of ground troops. ..."
"... President Obama has already far surpassed even his predecessor, George W. Bush, in taking the country to war without even the fig leaf of an authorization. ..."
"... Instead of impeachment, which he deserved for the disastrous Libya invasion, Congress said nothing. House Republicans only managed to bring the subject up when they thought they might gain political points exploiting the killing of US Ambassador Chris Stevens in Benghazi. ..."
"... Vice President Joe Biden said that if the upcoming peace talks in Geneva are not successful, the US is prepared for a massive military intervention in Syria. Such an action would likely place the US military face to face with the Russian military, whose assistance was requested by the Syrian government. In contrast, we must remember that the US military is operating in Syria in violation of international law. ..."
"... At the insistence of Saudi Arabia and with US backing, the representatives of the Syrian opposition at the Geneva peace talks will include members of the Army of Islam, which has fought with al-Qaeda in Syria. Does anyone expect these kinds of people to compromise? Isn't al-Qaeda supposed to be our enemy? ..."
"... The purpose of the Legislative branch of our government is to restrict the Executive branch's power. The Founders understood that an all-powerful king who could wage war at will was the greatest threat to life, liberty, and the pursuit of happiness. That is why they created a people's branch, the Congress, to prevent the emergence of an all-powerful autocrat to drag the country to endless war. Sadly, Congress is surrendering its power to declare war. ..."
January 24, 2016 | The Ron Paul Institute for Peace and Prosperity
While the Washington snowstorm dominated news coverage this week, Senate Majority Leader Mitch McConnell was operating behind the scenes to rush through the Senate what may be the most massive transfer of power from the Legislative to the Executive branch in our history. The senior Senator from Kentucky is scheming, along with Sen. Lindsey Graham, to bypass normal Senate procedure to fast-track legislation to grant the president the authority to wage unlimited war for as long as he or his successors may wish.

The legislation makes the unconstitutional Iraq War authorization of 2002 look like a walk in the park. It will allow this president and future presidents to wage war against ISIS without restrictions on time, geographic scope, or the use of ground troops. It is a completely open-ended authorization for the president to use the military as he wishes for as long as he (or she) wishes. Even President Obama has expressed concern over how willing Congress is to hand him unlimited power to wage war.

President Obama has already far surpassed even his predecessor, George W. Bush, in taking the country to war without even the fig leaf of an authorization. In 2011 the president invaded Libya, overthrew its government, and oversaw the assassination of its leader, without even bothering to ask for Congressional approval. Instead of impeachment, which he deserved for the disastrous Libya invasion, Congress said nothing. House Republicans only managed to bring the subject up when they thought they might gain political points exploiting the killing of US Ambassador Chris Stevens in Benghazi.

It is becoming more clear that Washington plans to expand its war in the Middle East. Last week the media reported that the US military had taken over an air base in eastern Syria, and Defense Secretary Ashton Carter said that the US would send in the 101st Airborne Division to retake Mosul in Iraq and to attack ISIS headquarters in Raqqa, Syria. Then on Saturday, Vice President Joe Biden said that if the upcoming peace talks in Geneva are not successful, the US is prepared for a massive military intervention in Syria. Such an action would likely place the US military face to face with the Russian military, whose assistance was requested by the Syrian government. In contrast, we must remember that the US military is operating in Syria in violation of international law.

The prospects of such an escalation are not all that far-fetched. At the insistence of Saudi Arabia and with US backing, the representatives of the Syrian opposition at the Geneva peace talks will include members of the Army of Islam, which has fought with al-Qaeda in Syria. Does anyone expect these kinds of people to compromise? Isn't al-Qaeda supposed to be our enemy?

The purpose of the Legislative branch of our government is to restrict the Executive branch's power. The Founders understood that an all-powerful king who could wage war at will was the greatest threat to life, liberty, and the pursuit of happiness. That is why they created a people's branch, the Congress, to prevent the emergence of an all-powerful autocrat to drag the country to endless war. Sadly, Congress is surrendering its power to declare war.

Let's be clear: If Senate Majority Leader McConnell succeeds in passing this open-ended war authorization, the US Constitution will be all but a dead letter.


Copyright © 2016 by RonPaul Institute. Permission to reprint in whole or in part is gladly granted, provided full credit and a live link are given.
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[Jan 18, 2016] US will eventually bomb Iran as it bombed others - foreign policy expert

Looks like Iran if far from safe even after sanctions were lifted...
Notable quotes:
"... The idea that were the exceptional nation and have something very important to impart to the rest of the world, our marvelous values, American exceptionalism... Each party believes in that very strongly. They dont argue about that at all, except through their campaign debate, theyll take certain opposing views just to appear different. But, in power, they have the exact same policy – world domination. ..."
"... NATO is just an arm of the U.S. foreign policy, theres no point actually in making a distinction between US foreign policy and NATO policy – they are the same. If US were not in NATO, NATO would not exist. US founded NATO, US is its main supporter and financial source, theres no distinction between US and NATO, and they share the same view of American world domination. So, it doesnt matter whether Iran is doing this or that – they know that Iran is not a lover of an Empire, and anyone whos not a lover of the Empire has a short life span. Iran, Venezuela, Cuba, whatever. That is the test, do you love Empire or not. ..."
"... Because Russia has two characteristics of an enemy, which Washington cannot tolerate: one, it has very powerful military capabilities, and two, it is not a kind of Washingtons policy, it is not a great admirer of the Empire. The same applies to China. Thats all it takes: you dont admire us and have military force – thats all it takes to be an enemy of Washington. ..."
"... Washington is not looking for peace or war. It is looking for domination, and if they can achieve domination peacefully – thats fine. If they cant, theyll use war. Its that simple. ..."
"... They are still supporting the enemies of Syria, and they are making sure that Assad will not come back to power. They are bombing places all over Syria, which can be useful militarily to Syria. They have not forgotten about Syria at all. Iraq is ally at the moment, but tomorrow or yesterday it is something different. You cant just look at today and say "theyre not fighting here and there" and think "Oh, Washington has finally found peace". No. Their basic goal is unchanged – today, tomorrow, or next year. I must say, again, for the tenth time, it is world domination. ..."
"... The US has created ISIS. Let me point this out – a short while ago, there were four major states in the Middle East and South Asia, which were secular. The US invaded Iraq, then invaded Libya and overthrew that secular government. Then its been in the process now, for some years, attempting to overthrow the secular government in Syria. Theres no wonder that Middle East and South Asia have been taken over by religious fanatics: all the possible enemies and barriers to that had been wiped out by Washington. Why will they stop now? ..."
"... Well, I could say "yes", except that the US will cheat. They will use the same force to attack other people, like in Syria, they will use the same force to help overthrow Assad, and they will use the same force to suppress any segment of Iraq or what have you, which are anti-America. They cannot be trusted, thats the problem. When they start to use force, theres no holding them back, and they dont care about the civilians. The civilian death toll with any bombing of Syria and Iraq is unlimited. So, for those reasons, I cannot support US bombing of Iraq or Syria or anywhere else. The US bombing should cease everywhere in the world. ..."
Apr 17 , 2015 | RT - SophieCo

Obama's time as leader of the US is coming to an end - his term concludes next year. Wannabe presidents have already joined the race to the White House. And as President Obama goes through the final year of his rule, Washington suddenly changes its tone – now Iran is an appropriate nation to talk to, and it's okay to meet with Cuban and Venezuelan leaders. But what is in that change? Has Washington finally dropped its previous policies? What does Obama want to achieve? And will the new, as yet unknown, leader of America make any difference? We pose these questions to prominent historian, author of bestsellers on US foreign policies, William Blum, who is on Sophie&Co today.

Sophie Shevardnadze :William Blum, historian and author of bestsellers like "Rogue State" and "America's Deadliest Export", welcome to the show, it's great to have you with us. Now, Hillary Clinton has announced she's running to become the Democrats' presidential candidate; Jeb Bush is also likely to put his bit forward for the Republicans. Now, Bush, Clinton – we've been here before. Who would be better candidate do you think? Not just for the U.S., but also for the world, like, global peace efforts, for instance?

William Blum: I don't think US foreign policy will change at all, regardless of who is in the White House, Bush or Clinton, or who else is running. Our policy does not change... I can add Obama to that. It wouldn't even matter which party it is, Republican or Democrat, they have the same foreign policy.

SS: Why do you think it's the same policy for both parties? Why do you think they are not different from each other?

WB: Because America, for two centuries has had one basic, overriding goal, and that is world domination, at least from 1890s if not earlier, one can say that. World domination is something which appeals to both Republicans and Democrats or Liberals or Conservatives. The idea that we're the exceptional nation and have something very important to impart to the rest of the world, our marvelous values, American exceptionalism... Each party believes in that very strongly. They don't argue about that at all, except through their campaign debate, they'll take certain opposing views just to appear different. But, in power, they have the exact same policy – world domination.

SS: Now back in 2009 President Obama made it clear that the missile shield in Europe would no longer be necessary if the threat from Iran was eliminated – and nuclear deal with Iran was struck. Now, historic deal is close, but NATO is saying there will be no change in missile shield plans – why not?

WB: Because NATO shares America's desire to dominate the world. NATO is just an arm of the U.S. foreign policy, there's no point actually in making a distinction between US foreign policy and NATO policy – they are the same. If US were not in NATO, NATO would not exist. US founded NATO, US is its main supporter and financial source, there's no distinction between US and NATO, and they share the same view of American world domination. So, it doesn't matter whether Iran is doing this or that – they know that Iran is not a lover of an Empire, and anyone who's not a lover of the Empire has a short life span. Iran, Venezuela, Cuba, whatever. That is the test, do you love Empire or not.

SS: But, can we be a little bit more precise about this "domination" theory – NATO has been strengthening its eastern borders with military building up on Russia's doorsteps, and a rapid reaction force to include 30,000 personnel – why this deployment? Who is it aimed against?

WB: It is aimed against Russia. The US cannot stand anyone who might stay in the way of the Empire's expansion – and Russia and China are the only nations which can do that. Other nations, like Cuba or Iran or Venezuela are regarded as enemy just as well, because they have the polity influence: Cuba has influence over all of the Western hemisphere. That makes them a great enemy. But the basic criteria of Empire's expansion is whether you support Empire or not, and that excludes all the countries I've named – from Cuba to Russia.

SS: Do you think U.S. would go as far as using force against its enemies?

WB: Well, the US has used force against its enemies on a regular basis for two centuries. Of course they would use force! They've used force against Cuba, they invaded Cuba and they've supported Cuban exiles in all kinds of violent activities for 60 years. Violence is never far removed from the U.S. policy. Let me summarize something for the benefit of listeners: since 1946 the US has attempted to overthrow more than 50 foreign governments. In the same time period it has attempted to assassinate more than 50 foreign leaders. It has bombed the people of 30 countries, it has suppressed revolutionary parties in at least 20 nations – and I forgot other factors on my list. This is a record unparalleled in all of human history, and there's no reason to think it is changing of will change, except if some superior force comes on a scene, that can actually defeat U.S.

SS: But, you know, French intelligence – and France seems to be an ally of the U.S. - the French intelligence chief has recently said that they found no evidence of Russia planning to invade Ukraine. So why has NATO been pressing these claims of an imminent invasion so hard and for so long?

WB: Because Russia has two characteristics of an enemy, which Washington cannot tolerate: one, it has very powerful military capabilities, and two, it is not a kind of Washington's policy, it is not a great admirer of the Empire. The same applies to China. That's all it takes: you don't admire us and have military force – that's all it takes to be an enemy of Washington.

SS: The problem is, there's a ceasefire that seems in place, right? But US paratroopers have arrived in Ukraine to train forces in the country, and it's not the first such deployment we've seen. So, with ceasefire agreement and peace deal on the way, why is Washington sending troops now?

WB: They know very well that Ukraine is not...or those who live in Ukraine and support Russia, Washington knows very well that these people are not on their side, and will not be on their side, and there's no way to make them on our side, so, US is expecting to wipe them out militarily at some point in the near future. As soon as they can get all the politics in place, there's no backtracking from these policies. I must repeat myself again: Washington wants to dominate the world and anyone, including people in the south-eastern part of Ukraine, who don't share that view, they are enemies, and at some point they may be met with military force.

SS: So are you saying that America doesn't want peace in Ukraine, because US is sending military personnel to Ukraine – like I've said – while Europeans are negotiating peace without America's involvement?

WB: Washington is not looking for peace or war. It is looking for domination, and if they can achieve domination peacefully – that's fine. If they can't, they'll use war. It's that simple.

SS: So, like you've said, America is one of the main financiers of NATO; there's also Estonia and they meet NATO's funding goals. Why are the rest of its members lagging behind? Isn't the alliance important to them as well?

WB: They have their own home politics that they deal with, they each have their own financial needs to deal with, they each have their own relation with Washington to deal with, it varies. It is not exactly the same in these countries, but overall, no member of NATO is going to fight against Washington. No member of NATO was going to support the insurgence in Ukraine – not one. So there's no need to go upon who is not paying and who is paying – none of them will ever go against Washington's policies in Ukraine or elsewhere.

SS: Now, on the other hand, Europe, U.S. and Russia – they share similar security threats, issues like Syria, Islamic State, there's Afghanistan, and they are not going anywhere. Can these states work together if it is absolutely necessary, for example?

WB: They don't have the same security threats. Washington just announces that people of various countries are enemies of the U.S. - that doesn't make them a threat. Syria, for example, is no threat to the U.S. Neither was Iraq, neither was Libya. U.S. invades one country after another, totally independent of whether they are threat or not. As long as they don't believe in the Empire, as long as they are helping enemies of the Empire. I mean, what threat was Libya to Washington? NATO invaded them without mercy, bombed them out of existence, they are a failed state now. What was their threat? There's no threat. If Russia doesn't announce Libya as a threat, it's not because Russia has a different foreign policy – it's because Russia is not so paranoid as the U.S., and Russia is not looking for world domination.

SS: Russia has been criticized many times for its decision to supply air defense missile systems to Iran. Now, why is America so worried about anti-air missile defense Iran may get from Russia? It's not like Washington got plans to bomb Iran, right?

WB: Of course they do, and so does Israel. You can't put aside those fears. Washington, as I mentioned before, has bombed more than 30 countries. Why would they stop now? Iran is a definite target of the U.S. and Israel, and it's very understandable that Iran would want to have advanced missile defense systems.

SS: But look: US is staying out of Yemen now, it's not willing to commit ground troops to Iraq or get involved in Syria. It sometimes looks like Washington is growing weary of foreign interventions, lately.

WB: They are still supporting the enemies of Syria, and they are making sure that Assad will not come back to power. They are bombing places all over Syria, which can be useful militarily to Syria. They have not forgotten about Syria at all. Iraq is ally at the moment, but tomorrow or yesterday it is something different. You can't just look at today and say "they're not fighting here and there" and think "Oh, Washington has finally found peace". No. Their basic goal is unchanged – today, tomorrow, or next year. I must say, again, for the tenth time, it is world domination.

SS: Now, you've written in one of your books, the "Rogue State" that if you were President, you'd end all US foreign interventions at once. Can the US do that? Is it that simple? I mean, US left Iraq and look what happened.

WB: If I were a President, yes, that's what I would do. And then I add, to the portion you've quoted, I add at the end of paragraph, on my fifth day in the office I would be assassinated. So, that's what happens to people who want to challenge the Empire's policies. But I would have great time for the first few days.

SS: But can the US realistically do that? End all of their foreign interventions at once? Because, we see an example of Iraq, once they left, ISIS spread.

WB: The US has created ISIS. Let me point this out – a short while ago, there were four major states in the Middle East and South Asia, which were secular. The US invaded Iraq, then invaded Libya and overthrew that secular government. Then it's been in the process now, for some years, attempting to overthrow the secular government in Syria. There's no wonder that Middle East and South Asia have been taken over by religious fanatics: all the possible enemies and barriers to that had been wiped out by Washington. Why will they stop now?

SS: I see your point. While Iraq and Afghanistan cannot be exactly described as victories for American troops, I mean, the invasions have also resulted, for instance, in girls being able to go to school in Afghanistan, or Kurds finally having a state in Iraq, for instance.

WB: I must tell you something and all your listeners. At one time, in 1980s, Afghanistan had a progressive government, where women had full rights; they even wore mini-skirts. And you know what happened to that government? The US overthrew it. So please, don't tell me about US policy helping the girls or the women of Afghanistan. We are the great enemy of females of Afghanistan.

SS: You've also said that an end to US interventions would mean an end to terror attacks. What makes you think Islamic State and Al-Qaeda and other terror groups would cease to exist – and I'm talking about right now, I am not talking about "if America hadn't invaded them back then". Right now, if American interventions cease, what makes think that these terrorist groups would cease to exist as well?

WB: It may be too late now. When I wrote that, it was correct. It may be too late now. After what we've done to all secular governments in the Middle East and in South Asia, after all that, I am not sure I would say the same thing again. We've unleashed ISIS, and they're not going to be stopped by any kind words or nice changes of policy by Washington. They have to be wiped out militarily. They are an amazing force of horror, and the U.S. is responsible for them, but the barn door may be closed, it may be too late now to simply change our policy.

SS: So do you think US should use military force to eradicate these terrorist groups?

WB: Well, I could say "yes", except that the US will cheat. They will use the same force to attack other people, like in Syria, they will use the same force to help overthrow Assad, and they will use the same force to suppress any segment of Iraq or what have you, which are anti-America. They cannot be trusted, that's the problem. When they start to use force, there's no holding them back, and they don't care about the civilians. The civilian death toll with any bombing of Syria and Iraq is unlimited. So, for those reasons, I cannot support US bombing of Iraq or Syria or anywhere else. The US bombing should cease everywhere in the world.

SS: When I listen to you, it sounds like America overthrows all these governments and bombs all these countries, and makes revolutions – from people's point of view, revolutions and overthrows are really impossible if they are not conducive to people's moods on the ground. So you're saying the foreign policy has greatly contributed to the rise of radical Islam in the Middle East, but I wonder – don't locals have control over their own direction at all?

WB: The locals had no say whatsoever on whether the US would bomb or not, they had no say whatsoever on whether the US would overthrow governments chosen by the people, often – they have no say in these things. Now, they may hate ISIS, or some of them might hate ISIS, but it's too late. They can't do anything about it. The world is in terrible position. The world had a chance, 30-40 years ago, to stop the US from all of these interventions. If NATO had been closed, the way the Warsaw Pact was closed, the Soviet Union closed the Warsaw Pact with the expectation that NATO will also go out of business – but the US did not do that, and it's too late now. I don't know what to say, what will save the world now.

SS: You've mentioned Cuba and Venezuela in the beginning of the programme. Now, we witnessed several historic meetings recently, between President Obama and Cuba's President Raul Castro, also Obama's meeting with Venezuelan President Nicolas Maduro – why is Obama now talking with states the US has long considered arch-enemies?

WB: You must keep in mind, first of all, that nothing whatsoever has changed, as of this moment nothing has changed. We have to wait and see what happens, and I'm very sceptical. For example, with Cuba, the main issue is the US sanctions which have played havoc with Cuban economy and society. That has not changed, and I don't think it is going to change even in my lifetime. So, you can't apply some kind of changes taking place. Why Obama is saying these things he's saying now may have to do with his so-called "legacy". He knows his time is very limited, and he knows he has many enemies amongst progressives in the US and elsewhere. He may want to cater to them for some reason. I don't know, neither do you know, no one knows exactly why he's saying these things – but they don't mean anything yet. Nothing has changed whatsoever.

SS: So you're saying there's really no substance in those meetings... Now, looking back, what would you call Obama's biggest achievements of his two terms - I mean, people say there's been a reconciliation with Cuba, with Iran, there's an earnest attempt to end US deployment in Iraq and in Afghanistan, he didn't move troops into Syria. Would you disagree with all of that?

WB: Yes, all of that. There's no accomplishment whatsoever. He didn't move troops into Syria because of Russia, and not because of him making any change. He was embarrassed in that. John Kerry made a remark about "it would be nice if Syria would get rid of its chemical weapons – but that's not going to happen" he said, and then foreign minister Lavrov of Russia jumped in and said "Oh really? We'll arrange that" - and they arranged Syria to get rid of chemical weapons. That was, yes, a slip of the tongue by John Kerry, and he was embarrassed to challenge Lavrov. We can say the same thing about any of the things you've mentioned. There's no substance involved in any of these policies. The US has not relented at all over Syria. As I've mentioned before, they are bombing Syria's military assets, they are killing civilians every day. Syria is still a prime target of Washington, and they will never escape.

SS: Thank you very much for this interesting insight, we were talking to William Blum, historian and author of bestsellers "Rogue State" and "America's Deadliest Export" discussing matters of the US foreign policy and what would happen if the US decides to end all of its foreign interventions at once. That's it for this edition of Sophie&Co, I will see you next time.

[Jan 16, 2016] Graun is difficult to navigate and very slow to load with the weight of all the spam

Notable quotes:
"... Graun is difficult to navigate and very slow to load with the weight of all the spam. Ad blockers make it actually usable. You just have to get used to deleting the notice banners on every page. ..."
"... Use https everywhere to avoid the sticky at the top if it annoys you as it does me - tends to mess up the btl however.. ..."
"... Well, Guardian, I am using an ad blocker because your adware fucks up my browser. ..."
"... I cannot get even one word typed and my browser gets all fucked up. The screen does flips and all sorts of things as if someone else is controlling my mouse. I try to type a word and it takes a full minute for one letter to appear after I have typed it, and sometimes everything disappears. ..."
www.theguardian.com

puppetlife -> ConventionPrevention, 2016-01-16 10:01:00

Agree with your post if a little off topic, but where else can we post about this. Graun is difficult to navigate and very slow to load with the weight of all the spam. Ad blockers make it actually usable. You just have to get used to deleting the notice banners on every page.

Use "https everywhere" to avoid the sticky at the top if it annoys you as it does me - tends to mess up the btl however..

ConventionPrevention, 2016-01-16 08:38:06

We notice you're using an ad-blocker. Perhaps you'll support us another way? Become a supporter for just 50 pounds per year.

WTF? How do they know I am using an ad blocker? I am Using Ublock by the way. Well, Guardian, I am using an ad blocker because your adware fucks up my browser.

I cannot get even one word typed and my browser gets all fucked up. The screen does flips and all sorts of things as if someone else is controlling my mouse. I try to type a word and it takes a full minute for one letter to appear after I have typed it, and sometimes everything disappears.

THIS is WHY I use an ad-blocker, Guardian. Since I have been using an ad-blocker, I don't have those problems anymore when I visit your site, and it only happens on your site. Your incessant use of automatic videos and other tactics is not advertising.

It is ADWARE! Get it?! Adware! And why would I want to support a paper that is just as biased as any other paper? Wow, you really pissed me off just now when I saw that little banner at the bottom of my screen, Guardian. Of all the nerve.

Leeblue -> ConventionPrevention, 2016-01-16 09:05:47
Spot on CP, I actually switched my adblocker off to accommodate the graun, I thought fair enough they need to generate income. But as you said the browser goes haywire.

Another thing is the ridiculous moderation I receive for expressing a viewpoint, without foul language, without racist overtones, in fact just normal comments and like yesterday I commented on the fact that I do not believe in religion in any form, I think it is fantasist nonsense, put their by the ruling class elitist's in order to keep the plebs in place with angst, that gets moderated.

It is absolutely shameful how the graun operates these days.

[Jan 15, 2016] The Heavy Price of Economic Policy Failures

Notable quotes:
"... By Jayati Ghosh, Professor of Economics and Chairperson at the Centre for Economic Studies and Planning, Jawaharlal Nehru University, New Delhi. Cross posted from The Frontline ..."
"... arguments that treat economic processes as the inevitable results of some forces outside the system that follow their own logic and are beyond social intervention, are hugely misplaced. ..."
"... Behind almost every prolonged economic malfeasance there is some combination of outworn bad ideas, incompetence and the malign influence of powerful special interests. ..."
"... Weisbrot notes that this entire episode "should have been a historic lesson about the importance of national and democratic control over macroeconomic policy – or at the very least, not ceding such power to the wrong people and institutions". (page 4) Unfortunately, the opposite seems to be the case, with the lessons being drawn by the media and others still very much in terms of blaming the victim. Indeed, Weisbrot makes an even stronger point, that this crisis was used by vested interests (including those in the IMF) to force governments in these countries to implement economic and social reforms that would otherwise be unacceptable to their electorates. ..."
"... The significance of vested interests – finance and large capital in particular – in pushing economies to the edge to force neo-liberal reforms that operate to their favour, has been noted in many countries before, especially developing countries facing IMF conditionalities. The standard requirements: fiscal consolidation led by budget cuts in pensions, health and social spending; reductions in public employment; making labour markets more "flexible" by effectively reducing labour protection; cutting subsidies that benefit the poor like food subsidies while providing more tax cuts and other fiscal incentives to the rich, etc. ..."
"... The standard economic policy model fails, and the costs of such failure are huge – so it is critically important for more people across the world to be aware of them and to demand that their governments opt for more democratic and just economic strategies. ..."
"... It seems if my memory serves me, in around April of 2009 the rules of the game for the banks in the US were changed; i.e., all those "investments" that became trash (bad mortgages etc.) they had on their "books" could be re-classified and held, "off the books" for the duration….as long as it would take to recover their investments…..which could take decades…. ..."
www.nakedcapitalism.com
January 15, 2016 by Yves Smith

By Jayati Ghosh, Professor of Economics and Chairperson at the Centre for Economic Studies and Planning, Jawaharlal Nehru University, New Delhi. Cross posted from The Frontline

A lot of the media discussion on the global economy nowadays is based on the notion of the "new normal" or "new mediocre" – the phenomenon of slowing, stagnating or negative economic growth across most of the world, with even worse news in terms of employment generation, with hardly any creation of good quality jobs and growing material insecurity for the bulk of the people. All sorts of explanations are being proffered for this state of affairs, from technological progress, to slower population growth, to insufficient investment because of shifts in relative prices of capital and labour, to "balance sheet recessions" created by the private debt overhang in many economies, to contractionary fiscal stances of governments that are also excessively indebted.

Yet these arguments that treat economic processes as the inevitable results of some forces outside the system that follow their own logic and are beyond social intervention, are hugely misplaced. Most of all, they let economic policies off the hook when attributing blame – and this is massively important because then the possibility of alternative strategies that would not result in the same outcomes are simply not considered.

In an important new book, Failed: What the "experts" got wrong about the global economy (Oxford University Press, New York 2015), Mark Weisbrot calls this bluff effectively and comprehensively. He points out that "Behind almost every prolonged economic malfeasance there is some combination of outworn bad ideas, incompetence and the malign influence of powerful special interests." (page 2) Unfortunately, such nightmares are prolonged and even repeated in other places, because even if the lessons from one catastrophe are learned, they are typically not learned – or at least not taken to heart – by "the people who call the shots".

The costs of this failure are indeed huge for the citizenry: for workers who face joblessness or very fragile insecure employment at low wages; for families whose access to essential goods and social services is reduced; for farmers and other small producers who find their activities are simply not financially viable; for those thrown by crisis and instability into poverty or facing greater hunger; for almost everyone in the society when their lives become more insecure in various ways. Many millions of lives across the world have been ruined because of the active implementation of completely wrong and unnecessary economic policies. Yet, because the blame is not apportioned where it is due, those who are culpable for this not only get away with it, but are able to continue to impose their power and their expertise on economic policies and on governing institutions. For them, there is no price to be paid for failure.

Weisbrot illustrates this with the telling example of the still unfolding economic tragedy in the eurozone. He describes the design flaws in the monetary union that meant that the European Central Bank (ECB) did not behave like a real central bank to all the member countries, because when the crisis broke in 2009-10 it did not behave as a lender of last resort to the countries in the European periphery that faced payment difficulties. Instead the most draconian austerity measures were imposed on these countries, which simply drove these countries further into economic decline and made their debt burdens even more burdensome and unpayable.

It took two years of this, at a point when the crisis threatened to engulf the entire EU and force the monetary union to collapse, for the ECB Governor Mario Draghi to promise to "do whatever it takes to save the euro". And then, when the financial bleeding was stemmed, it became glaringly evident that the European authorities, and the ECB, could have intervened much earlier to reduce the damage in the eurozone periphery, through monetary and fiscal policies. In countries with their own central banks, like the US and the UK, such policies were indeed undertaken, which is why the recovery also came sooner and with less pain than still persists in parts of Europe.

Why could this not have been done earlier? Why were the early attempts at restructuring Greek debt not more realistic so as to reduce the debt levels to those that could feasibly be repaid by that country? Why was each attempt to solve the problem so tardy, niggardly and half-hearted that the problem progressively got worse and even destroyed the very fabric of social life in the affected countries? Why was the entire burden of adjustment forced upon hapless citizens, with no punishment for or even minor pain felt by the financial agents who had helped to create the imbalances that resulted in the crisis?

Weisbrot notes that this entire episode "should have been a historic lesson about the importance of national and democratic control over macroeconomic policy – or at the very least, not ceding such power to the wrong people and institutions". (page 4) Unfortunately, the opposite seems to be the case, with the lessons being drawn by the media and others still very much in terms of blaming the victim. Indeed, Weisbrot makes an even stronger point, that this crisis was used by vested interests (including those in the IMF) to force governments in these countries to implement economic and social reforms that would otherwise be unacceptable to their electorates.

The significance of vested interests – finance and large capital in particular – in pushing economies to the edge to force neo-liberal reforms that operate to their favour, has been noted in many countries before, especially developing countries facing IMF conditionalities. The standard requirements: fiscal consolidation led by budget cuts in pensions, health and social spending; reductions in public employment; making labour markets more "flexible" by effectively reducing labour protection; cutting subsidies that benefit the poor like food subsidies while providing more tax cuts and other fiscal incentives to the rich, etc.

Weisbrot notes that such policies are neither necessary to emerge from a crisis (in fact in most cases they are counterproductive) nor are they conducive to long term development. He provides concrete examples of countries that did things very differently, and were successful as a result. The most important such example he provides is that of China, a country that systematically followed a state-led heterodox strategy for industrialisation, with the state controlling the banking system and a huge role for state-owned enterprises. The unorthodox policies it followed brought about the fastest growth in history, lifted hundreds of millions of Chinese people out of poverty and also pulled along other developing countries because of its rapidly growing demand for imports.

Weisbrot identifies other successful examples of heterodox policies that helped countries to emerge from crisis and improve living standards for their people, such as Argentina in the mid 2000s and a range of other explicitly progressive governments in Latin American countries that followed alternative approaches to increase wage incomes and formal employment through active state intervention. One important reason they were able to implement unorthodox economic policies was the relative decline in the power of the International Monetary Fund (IMF) in this period. Weisbrot argues that the IMF began to lose influence in the wake of the Asian crisis of 1998, when it so clearly got both its assessment of the problem and its proposed solutions completely wrong. The geopolitical and economic changes that this loss of IMF influence enabled were hugely beneficial for the citizenry in these countries – and point to the huge costs still being paid by those forced to live under neoliberal economic orthodoxy.

Weisbrot ends his book on a positive note (other than for the eurozone, where he forecasts continued pain for the near future). He believes that "in the developing world, economic policy and the rate of increase of living standards are likely to show improvement in the foreseeable future". (page 236) This is largely because of his belief that the existing multilateral arrangements and institutions that forced orthodox policies upon developing countries will continue to decline, and they will have freedom and ability to pursue heterodox policies that served them well in the recent past.

Unfortunately, this belief now seems over-optimistic. In the past year we have witnessed "emerging markets" in retreat as global finance has pulled out of them, and the reinforcement of institutions and arrangements (in trade and investment treaties and other financial agencies) designed to dramatically reduce the autonomy of national policy making. We are seeing political changes in several countries that suggest a renewed dominance of neoliberal market-driven economic approaches that privilege the interests of large capital. And even in China, there are signs of confusion, as the growth process runs out of steam, with recent moves towards more financial liberalisation that could have huge implications in terms of future viability of independent economic strategies.

This is somewhat depressing, but it makes Weisbrot's main argument even more important and compelling. The standard economic policy model fails, and the costs of such failure are huge – so it is critically important for more people across the world to be aware of them and to demand that their governments opt for more democratic and just economic strategies.

Carla, January 15, 2016 at 1:26 pm

"In countries with their own central banks, like the US and the UK, such policies were indeed undertaken, which is why the recovery also came sooner and with less pain than still persists in parts of Europe."

The peoples of the US and the UK do not seem to be enjoying our respective "recoveries" very much.

JohnnyGL, January 15, 2016 at 1:38 pm

It can always get worse….much worse….

JohnnyGL, January 15, 2016 at 1:37 pm

Good points, we should be given a chance to "throw the bums out" on economic policy, too. Unfortunately, the move toward independent central banks in the last several decades has given us LESS, not MORE democratic control over policy. I'd rather see the Fed held accountable to some kind of democratic control, whether through Congress or some other means.

Direct elections of FOMC members? Board of Governors? Not sure I like the idea, but can't be that bad, can it?

craazyboy, January 15, 2016 at 6:27 pm

No Paulson/Congress approval bank bailout would have been a start. Congress passing real bank reform after the dust settled would have been some nice follow up. Then the Fed telling Congress that interest rate policy by itself won't adequately fix all our ills(and eventually blow more bubbles) would have been some nice counterpoint going the other direction.

Changing the structure of the system won't help when the entire system gets captured.

sierra7, January 15, 2016 at 6:20 pm

It seems if my memory serves me, in around April of 2009 the rules of the game for the banks in the US were changed; i.e., all those "investments" that became trash (bad mortgages etc.) they had on their "books" could be re-classified and held, "off the books" for the duration….as long as it would take to recover their investments…..which could take decades….

At that time, around April 2009, the "market" made a turnaround and "climbed" back into the stratosphere…..
Anybody else remember this episode?

[Jan 14, 2016] The Lawyer Who Became DuPonts Worst Nightmare

Notable quotes:
"... DuPonts own instructions specified that it was not to be flushed into surface water or sewers. But over the decades that followed, DuPont pumped hundreds of thousands of pounds of PFOA powder through the outfall pipes of the Parkersburg facility into the Ohio River. The company dumped 7,100 tons of PFOA-laced sludge into digestion ponds: open, unlined pits on the Washington Works property, from which the chemical could seep straight into the ground. PFOA entered the local water table, which supplied drinking water to the communities of Parkersburg, Vienna, Little Hocking and Lubeck - more than 100,000 people in all. ..."
"... n 1981, 3M - which continued to serve as the supplier of PFOA to DuPont and other corporations - found that ingestion of the substance caused birth defects in rats. After 3M shared this information, DuPont tested the children of pregnant employees in their Teflon division. Of seven births, two had eye defects. DuPont did not make this information public. ..."
"... By the 90s, Bilott discovered, DuPont understood that PFOA caused cancerous testicular, pancreatic and liver tumors in lab animals. One laboratory study suggested possible DNA damage from PFOA exposure, and a study of workers linked exposure with prostate cancer. ..."
"... By the late 1980s, as DuPont became increasingly concerned about the health effects of PFOA waste, it decided it needed to find a landfill for the toxic sludge dumped on company property. Fortunately they had recently bought 66 acres from a low-level employee at the Washington Works facility that would do perfectly. ..."
"... DuPont did not tell this to the Tennants at the time, nor did it disclose the fact in the cattle report that it commissioned for the Tennant case a decade later - the report that blamed poor husbandry for the deaths of their cows. Bilott had what he needed. ..."
"... DuPont had for decades been actively trying to conceal their actions. They knew this stuff was harmful, and they put it in the water anyway. These were bad facts. He had seen what the PFOA-tainted drinking water had done to cattle. What was it doing to the tens of thousands of people in the areas around Parkersburg who drank it daily from their taps? What did the insides of their heads look like? Were their internal organs green? ..."
"... Under the 1976 Toxic Sub­stances Control Act, the E.P.A. can test chemicals only when it has been provided evidence of harm. This arrangement, which largely allows chemical companies to regulate themselves, is the reason that the E.P.A. has restricted only five chemicals, out of tens of thousands on the market, in the last 40 years. ..."
"... Sometimes her husband came home from work sick - fever, nausea, diarrhea, vomiting - after working in one of the PFOA storage tanks. It was a common occurrence at Washington Works. Darlene says the men at the plant called it Teflon flu. ..."
"... No one knows for certain how much PFOA is safe to drink. Rob Bilotts lawsuit against DuPont in West Virginia included anyone whose drinking water had levels above 0.05 parts per billion. But last June, based on a comprehensive review of previous health studies, Philippe Grandjean of the Harvard School of Public Health and Richard Clapp of the University of Massachusetts-Lowell named an approximate safe level of 0.001 p.p.b. Soon thereafter, the nonprofit Environmental Working Group analyzed two years of E.P.A. survey data to find that this threshold had been exceeded - in some cases by factors of 100 or more - in 94 water systems across 27 states. Below, the estimated number of people in each state whose drinking water is affected. ..."
"... But tests revealed that six districts, as well as dozens of private wells, were tainted with levels of PFOA higher than DuPonts own internal safety standard. In Little Hocking, the water tested positive for PFOA at seven times the limit. All told, 70,000 people were drinking poisoned water. Some had been doing so for decades. ..."
"... Meanwhile the E.P.A., drawing from Bilotts research, began its own investigation into the toxicity of PFOA. In 2002, the agency released its initial findings: PFOA might pose human health risks not only to those drinking tainted water, but also to the general public - anyone, for instance, who cooked with Teflon pans. ..."
"... By 2003 the average concentration of PFOA in the blood of an adult American was four to five parts per billion. In 2000, 3M ceased production of PFOA. DuPont, rather than use an alternative compound, built a new factory in Fayetteville, N.C., to manufacture the substance for its own use. ..."
"... As part of its agreement with the E.P.A., DuPont ceased production and use of PFOA in 2013. The five other companies in the world that produce PFOA are also phasing out production. ..."
"... Whenever possible, avoid products containing, or manufactured using, PFASs. These include many products that are stain-resistant, waterproof or nonstick. ..."
"... Every year Rob Bilott writes a letter to the E.P.A. and the West Virginia D.E.P., urging the regulation of PFOA in drinking water. In 2009, the E.P.A. set a provisional limit of 0.4 parts per billion for short-term exposure, but has never finalized that figure. This means that local water districts are under no obligation to tell customers whether PFOA is in their water. In response to Bilotts most recent letter, the E.P.A. claimed that it would announce a lifetime health advisory level for PFOA by early 2016. ..."
"... Residents of Issaquah, Wash.; Wilmington, Del.; Colorado Springs; and Nassau County on Long Island are among those whose water has a higher concentration of fluorochemicals than that in some of the districts included in Rob Bilotts class-action suit. ..."
"... Where scientists have tested for the presence of PFOA in the world, they have found it. PFOA is in the blood or vital organs of Atlantic salmon, swordfish, striped mullet, gray seals, common cormorants, Alaskan polar bears, brown pelicans, sea turtles, sea eagles, Midwestern bald eagles, California sea lions and Laysan albatrosses on Sand Island, a wildlife refuge on Midway Atoll, in the middle of the North Pacific Ocean, about halfway between North America and Asia. ..."
"... Bilott is currently prosecuting Wolf v. DuPont, the second of the personal-injury cases filed by the members of his class. The plaintiff, John M. Wolf of Parkersburg, claims that PFOA in his drinking water caused him to develop ulcerative colitis. That trial begins in March. When it concludes, there will be 3,533 cases left to try. ..."
www.nytimes.com

Rob Bilott was a corporate defense attorney for eight years. Then he took on an environmental suit that would upend his entire career - and expose a brazen, decades-long history of chemical pollution.

By NATHANIEL RICH

Just months before Rob Bilott made partner at Taft Stettinius & Hollister, he received a call on his direct line from a cattle farmer. The farmer, Wilbur Tennant of Parkersburg, W.Va., said that his cows were dying left and right. He believed that the DuPont chemical company, which until recently operated a site in Parkersburg that is more than 35 times the size of the Pentagon, was responsible. Tennant had tried to seek help locally, he said, but DuPont just about owned the entire town. He had been spurned not only by Parkersburg's lawyers but also by its politicians, journalists, doctors and veterinarians. The farmer was angry and spoke in a heavy Appalachian accent. Bilott struggled to make sense of everything he was saying. He might have hung up had Tennant not blurted out the name of Bilott's grandmother, Alma Holland White.

White had lived in Vienna, a northern suburb of Parkersburg, and as a child, Bilott often visited her in the summers. In 1973 she brought him to the cattle farm belonging to the Tennants' neighbors, the Grahams, with whom White was friendly. Bilott spent the weekend riding horses, milking cows and watching Secretariat win the Triple Crown on TV. He was 7 years old. The visit to the Grahams' farm was one of his happiest childhood memories.

When the Grahams heard in 1998 that Wilbur Tennant was looking for legal help, they remembered Bilott, White's grandson, who had grown up to become an environmental lawyer. They did not understand, however, that Bilott was not the right kind of environmental lawyer. He did not represent plaintiffs or private citizens. Like the other 200 lawyers at Taft, a firm founded in 1885 and tied historically to the family of President William Howard Taft, Bilott worked almost exclusively for large corporate clients. His specialty was defending chemical companies. Several times, Bilott had even worked on cases with DuPont lawyers. Nevertheless, as a favor to his grandmother, he agreed to meet the farmer. ''It just felt like the right thing to do,'' he says today. ''I felt a connection to those folks.''

The connection was not obvious at their first meeting. About a week after his phone call, Tennant drove from Parkersburg with his wife to Taft's headquarters in downtown Cincinnati. They hauled cardboard boxes containing videotapes, photographs and documents into the firm's glassed-in reception area on the 18th floor, where they sat in gray midcentury-modern couches beneath an oil portrait of one of Taft's founders. Tennant - burly and nearly six feet tall, wearing jeans, a plaid flannel shirt and a baseball cap - did not resemble a typical Taft client. ''He didn't show up at our offices looking like a bank vice president,'' says Thomas Terp, a partner who was Bilott's supervisor. ''Let's put it that way.''

Terp joined Bilott for the meeting. Wilbur Tennant explained that he and his four siblings had run the cattle farm since their father abandoned them as children. They had seven cows then. Over the decades they steadily acquired land and cattle, until 200 cows roamed more than 600 hilly acres. The property would have been even larger had his brother Jim and Jim's wife, Della, not sold 66 acres in the early '80s to DuPont. The company wanted to use the plot for a landfill for waste from its factory near Parkersburg, called Washington Works, where Jim was employed as a laborer. Jim and Della did not want to sell, but Jim had been in poor health for years, mysterious ailments that doctors couldn't diagnose, and they needed the money.

DuPont rechristened the plot Dry Run Landfill, named after the creek that ran through it. The same creek flowed down to a pasture where the Tennants grazed their cows. Not long after the sale, Wilbur told Bilott, the cattle began to act deranged. They had always been like pets to the Tennants. At the sight of a Tennant they would amble over, nuzzle and let themselves be milked. No longer. Now when they saw the farmers, they charged.

Wilbur fed a videotape into the VCR. The footage, shot on a camcorder, was grainy and intercut with static. Images jumped and repeated. The sound accelerated and slowed down. It had the quality of a horror movie. In the opening shot the camera pans across the creek. It takes in the surrounding forest, the white ash trees shedding their leaves and the rippling, shallow water, before pausing on what appears to be a snowbank at an elbow in the creek. The camera zooms in, revealing a mound of soapy froth.

''I've taken two dead deer and two dead cattle off this ripple,'' Tennant says in voice-over. ''The blood run out of their noses and out their mouths. ... They're trying to cover this stuff up. But it's not going to be covered up, because I'm going to bring it out in the open for people to see.''

The video shows a large pipe running into the creek, discharging green water with bubbles on the surface. ''This is what they expect a man's cows to drink on his own property,'' Wilbur says. ''It's about high time that someone in the state department of something-or-another got off their cans.''

At one point, the video cuts to a skinny red cow standing in hay. Patches of its hair are missing, and its back is humped - a result, Wilbur speculates, of a kidney malfunction. Another blast of static is followed by a close-up of a dead black calf lying in the snow, its eye a brilliant, chemical blue. ''One hundred fifty-three of these animals I've lost on this farm,'' Wilbur says later in the video. ''Every veterinarian that I've called in Parkersburg, they will not return my phone calls or they don't want to get involved. Since they don't want to get involved, I'll have to dissect this thing myself. ... I'm going to start at this head.''

The video cuts to a calf's bisected head. Close-ups follow of the calf's blackened teeth (''They say that's due to high concentrations of fluoride in the water that they drink''), its liver, heart, stomachs, kidneys and gall bladder. Each organ is sliced open, and Wilbur points out unusual discolorations - some dark, some green - and textures. ''I don't even like the looks of them,'' he says. ''It don't look like anything I've been into before.''

Bilott watched the video and looked at photographs for several hours. He saw cows with stringy tails, malformed hooves, giant lesions protruding from their hides and red, receded eyes; cows suffering constant diarrhea, slobbering white slime the consistency of toothpaste, staggering bowlegged like drunks. Tennant always zoomed in on his cows' eyes. ''This cow's done a lot of suffering,'' he would say, as a blinking eye filled the screen.

''This is bad,'' Bilott said to himself. ''There's something really bad going on here.''

Bilott decided right away to take the Tennant case. It was, he says again, ''the right thing to do.'' Bilott might have had the practiced look of a corporate lawyer - soft-spoken, milk-complected, conservatively attired - but the job had not come naturally to him. He did not have a typical Taft résumé. He had not attended college or law school in the Ivy League. His father was a lieutenant colonel in the Air Force, and Bilott spent most of his childhood moving among air bases near Albany; Flint, Mich.; Newport Beach, Calif.; and Wiesbaden, West Germany. Bilott attended eight schools before graduating from Fairborn High, near Ohio's Wright-Patterson Air Force Base. As a junior, he received a recruitment letter from a tiny liberal-arts school in Sarasota called the New College of Florida, which graded pass/fail and allowed students to design their own curriculums. Many of his friends there were idealistic, progressive - ideological misfits in Reagan's America. He met with professors individually and came to value critical thinking. ''I learned to question everything you read,'' he said. ''Don't take anything at face value. Don't care what other people say. I liked that philosophy.'' Bilott studied political science and wrote his thesis about the rise and fall of Dayton. He hoped to become a city manager.

But his father, who late in life enrolled in law school, encouraged Bilott to do the same. Surprising his professors, he chose to attend law school at Ohio State, where his favorite course was environmental law. ''It seemed like it would have real-world impact,'' he said. ''It was something you could do to make a difference.'' When, after graduation, Taft made him an offer, his mentors and friends from New College were aghast. They didn't understand how he could join a corporate firm. Bilott didn't see it that way. He hadn't really thought about the ethics of it, to be honest. ''My family said that a big firm was where you'd get the most opportunities,'' he said. ''I knew nobody who had ever worked at a firm, nobody who knew anything about it. I just tried to get the best job I could. I don't think I had any clue of what that involved.''

The road to one of the Tennant farms. Credit Bryan Schutmaat for The New York Times

At Taft, he asked to join Thomas Terp's environmental team. Ten years earlier, Congress passed the legislation known as Superfund, which financed the emergency cleanup of hazardous-waste dumps. Superfund was a lucrative development for firms like Taft, creating an entire subfield within environmental law, one that required a deep understanding of the new regulations in order to guide negotiations among municipal agencies and numerous private parties. Terp's team at Taft was a leader in the field.

As an associate, Bilott was asked to determine which companies contributed which toxins and hazardous wastes in what quantities to which sites. He took depositions from plant employees, perused public records and organized huge amounts of historical data. He became an expert on the Environmental Protection Agency's regulatory framework, the Safe Drinking Water Act, the Clean Air Act, the Toxic Substances Control Act. He mastered the chemistry of the pollutants, despite the fact that chemistry had been his worst subject in high school. ''I learned how these companies work, how the laws work, how you defend these claims,'' he said. He became the consummate insider.

Bilott was proud of the work he did. The main part of his job, as he understood it, was to help clients comply with the new regulations. Many of his clients, including Thiokol and Bee Chemical, disposed of hazardous waste long before the practice became so tightly regulated. He worked long hours and knew few people in Cincinnati.

... ... ...

The Tennant case put Taft in a highly unusual position. The law firm was in the business of representing chemical corporations, not suing them. The prospect of taking on DuPont ''did cause us pause,'' Terp concedes. ''But it was not a terribly difficult decision for us. I'm a firm believer that our work on the plaintiff's side makes us better defense lawyers.''

... ... ...

Bilott filed a federal suit against DuPont in the summer of 1999 in the Southern District of West Virginia. In response, DuPont's in-house lawyer, Bernard Reilly, informed him that DuPont and the E.P.A. would commission a study of the property, conducted by three veterinarians chosen by DuPont and three chosen by the E.P.A. Their report did not find DuPont responsible for the cattle's health problems. The culprit, instead, was poor husbandry: ''poor nutrition, inadequate veterinary care and lack of fly control.'' In other words, the Tennants didn't know how to raise cattle; if the cows were dying, it was their own fault.

... ... ...

The story began in 1951, when DuPont started purchasing PFOA (which the company refers to as C8) from 3M for use in the manufacturing of Teflon. 3M invented PFOA just four years earlier; it was used to keep coatings like Teflon from clumping during production. Though PFOA was not classified by the government as a hazardous substance, 3M sent DuPont recommendations on how to dispose of it. It was to be incinerated or sent to chemical-waste facilities. DuPont's own instructions specified that it was not to be flushed into surface water or sewers. But over the decades that followed, DuPont pumped hundreds of thousands of pounds of PFOA powder through the outfall pipes of the Parkersburg facility into the Ohio River. The company dumped 7,100 tons of PFOA-laced sludge into ''digestion ponds'': open, unlined pits on the Washington Works property, from which the chemical could seep straight into the ground. PFOA entered the local water table, which supplied drinking water to the communities of Parkersburg, Vienna, Little Hocking and Lubeck - more than 100,000 people in all.

Bilott learned from the documents that 3M and DuPont had been conducting secret medical studies on PFOA for more than four decades. In 1961, DuPont researchers found that the chemical could increase the size of the liver in rats and rabbits. A year later, they replicated these results in studies with dogs. PFOA's peculiar chemical structure made it uncannily resistant to degradation. It also bound to plasma proteins in the blood, circulating through each organ in the body. In the 1970s, DuPont discovered that there were high concentrations of PFOA in the blood of factory workers at Washington Works. They did not tell the E.P.A. at the time. In 1981, 3M - which continued to serve as the supplier of PFOA to DuPont and other corporations - found that ingestion of the substance caused birth defects in rats. After 3M shared this information, DuPont tested the children of pregnant employees in their Teflon division. Of seven births, two had eye defects. DuPont did not make this information public.

In 1984, DuPont became aware that dust vented from factory chimneys settled well beyond the property line and, more disturbing, that PFOA was present in the local water supply. DuPont declined to disclose this finding. In 1991, DuPont scientists determined an internal safety limit for PFOA concentration in drinking water: one part per billion. The same year, DuPont found that water in one local district contained PFOA levels at three times that figure. Despite internal debate, it declined to make the information public.

(In a statement, DuPont claimed that it did volunteer health information about PFOA to the E.P.A. during those decades. When asked for evidence, it forwarded two letters written to West Virginian government agencies from 1982 and 1992, both of which cited internal studies that called into question links between PFOA exposure and human health problems.)

By the '90s, Bilott discovered, DuPont understood that PFOA caused cancerous testicular, pancreatic and liver tumors in lab animals. One laboratory study suggested possible DNA damage from PFOA exposure, and a study of workers linked exposure with prostate cancer. DuPont at last hastened to develop an alternative to PFOA. An interoffice memo sent in 1993 announced that ''for the first time, we have a viable candidate'' that appeared to be less toxic and stayed in the body for a much shorter duration of time. Discussions were held at DuPont's corporate headquarters to discuss switching to the new compound. DuPont decided against it. The risk was too great: Products manufactured with PFOA were an important part of DuPont's business, worth $1 billion in annual profit.

But the crucial discovery for the Tennant case was this: By the late 1980s, as DuPont became increasingly concerned about the health effects of PFOA waste, it decided it needed to find a landfill for the toxic sludge dumped on company property. Fortunately they had recently bought 66 acres from a low-level employee at the Washington Works facility that would do perfectly.

By 1990, DuPont had dumped 7,100 tons of PFOA sludge into Dry Run Landfill. DuPont's scientists understood that the landfill drained into the Tennants' remaining property, and they tested the water in Dry Run Creek. It contained an extraordinarily high concentration of PFOA. DuPont did not tell this to the Tennants at the time, nor did it disclose the fact in the cattle report that it commissioned for the Tennant case a decade later - the report that blamed poor husbandry for the deaths of their cows. Bilott had what he needed.

In August 2000, Bilott called DuPont's lawyer, Bernard Reilly, and explained that he knew what was going on. It was a brief conversation. The Tennants settled. The firm would receive its contingency fee. The whole business might have ended right there. But Bilott was not satisfied.

''I was irritated,'' he says.

DuPont was nothing like the corporations he had represented at Taft in the Superfund cases. ''This was a completely different scenario. DuPont had for decades been actively trying to conceal their actions. They knew this stuff was harmful, and they put it in the water anyway. These were bad facts.'' He had seen what the PFOA-tainted drinking water had done to cattle. What was it doing to the tens of thousands of people in the areas around Parkersburg who drank it daily from their taps? What did the insides of their heads look like? Were their internal organs green?

Bilott spent the following months drafting a public brief against DuPont. It was 972 pages long, including 136 attached exhibits. His colleagues call it ''Rob's Famous Letter.'' ''We have confirmed that the chemicals and pollutants released into the environment by DuPont at its Dry Run Landfill and other nearby DuPont-owned facilities may pose an imminent and substantial threat to health or the environment,'' Bilott wrote. He demanded immediate action to regulate PFOA and provide clean water to those living near the factory. On March 6, 2001, he sent the letter to the director of every relevant regulatory authority, including Christie Whitman, administrator of the E.P.A., and the United States attorney general, John Ashcroft.

... ... ...

''Rob's letter lifted the curtain on a whole new theater,'' says Harry Deitzler, a plaintiff's lawyer in West Virginia who works with Bilott. ''Before that letter, corporations could rely upon the public misperception that if a chemical was dangerous, it was regulated.'' Under the 1976 Toxic Sub­stances Control Act, the E.P.A. can test chemicals only when it has been provided evidence of harm. This arrangement, which largely allows chemical companies to regulate themselves, is the reason that the E.P.A. has restricted only five chemicals, out of tens of thousands on the market, in the last 40 years.

... ... ...

The letter led, four years later, in 2005, to DuPont's reaching a $16.5 million settlement with the E.P.A., which had accused the company of concealing its knowledge of PFOA's toxicity and presence in the environment in violation of the Toxic Substances Control Act. (DuPont was not required to admit liability.) At the time, it was the largest civil administrative penalty the E.P.A. had obtained in its history, a statement that sounds more impressive than it is. The fine represented less than 2 percent of the profits earned by DuPont on PFOA that year.

Bilott never represented a corporate client again.

The obvious next step was to file a class-action lawsuit against DuPont on behalf of everyone whose water was tainted by PFOA. In all ways but one, Bilott himself was in the ideal position to file such a suit. He understood PFOA's history as well as anyone inside DuPont did. He had the technical and regulatory expertise, as he had proved in the Tennant case. The only part that didn't make sense was his firm: No Taft lawyer, to anyone's recollection, had ever filed a class-action lawsuit.

It was one thing to pursue a sentimental case on behalf of a few West Virginia cattle farmers and even write a public letter to the E.P.A. But an industry-threatening class-action suit against one of the world's largest chemical corporations was different. It might establish a precedent for suing corporations over unregulated sub­stances and imperil Taft's bottom line. This point was made to Terp by Bernard Reilly, DuPont's in-house lawyer, according to accounts from Bilott's plaintiff's-lawyer colleagues; they say Reilly called to demand that Bilott back off the case. (Terp confirms that Reilly called him but will not disclose the content of the call; Bilott and Reilly decline to speak about it, citing continuing litigation.) Given what Bilott had documented in his Famous Letter, Taft stood by its partner.

A lead plaintiff soon presented himself. Joseph Kiger, a night-school teacher in Parkersburg, called Bilott to ask for help. About nine months earlier, he received a peculiar note from the Lubeck water district. It arrived on Halloween day, enclosed in the monthly water bill. The note explained that an unregulated chemical named PFOA had been detected in the drinking water in ''low concentrations,'' but that it was not a health risk. Kiger had underlined statements that he found particularly baffling, like: ''DuPont reports that it has toxicological and epidemiological data to support confidence that exposure guidelines established by DuPont are protective of human health.'' The term ''support confidence'' seemed bizarre, as did ''protective of human health,'' not to mention the claim that DuPont's own data supported its confidence in its own guidelines.

Still, Kiger might have forgotten about it had his wife, Darlene, not already spent much of her adulthood thinking about PFOA. Darlene's first husband had been a chemist in DuPont's PFOA lab. (Darlene asked that he not be named so that he wouldn't be involved in the local politics around the case.) ''When you worked at DuPont in this town,'' Darlene says today, ''you could have everything you wanted.'' DuPont paid for his education, it secured him a mortgage and it paid him a generous salary. DuPont even gave him a free supply of PFOA, which, Darlene says, she used as soap in the family's dishwasher and to clean the car. Sometimes her husband came home from work sick - fever, nausea, diarrhea, vomiting - after working in one of the PFOA storage tanks. It was a common occurrence at Washington Works. Darlene says the men at the plant called it ''Teflon flu.''

States of Uncertainty

No one knows for certain how much PFOA is safe to drink. Rob Bilott's lawsuit against DuPont in West Virginia included anyone whose drinking water had levels above 0.05 parts per billion. But last June, based on a comprehensive review of previous health studies, Philippe Grandjean of the Harvard School of Public Health and Richard Clapp of the University of Massachusetts-Lowell named an ''approximate'' safe level of 0.001 p.p.b. Soon thereafter, the nonprofit Environmental Working Group analyzed two years of E.P.A. survey data to find that this threshold had been exceeded - in some cases by factors of 100 or more - in 94 water systems across 27 states. Below, the estimated number of people in each state whose drinking water is affected.

Alabama 312,522
Arizona 217,218
California 1,441,298
Colorado 67,348
Delaware 320,484
Florida 971,913
Georgia 94,874
Illinois 135,763
Kentucky 730,611
Massachusetts 103,762
Maryland 104,567
Minnesota 143,637
New Hampshire 53,000
New Jersey 1,334,413
New York 174,000
North Carolina 225,262
Ohio 79,337
Oklahoma 20,307
Pennsylvania 221,121
Rhode Island 21,900
South Carolina 24,904
Tennessee 139,110
Texas 11,489
Virginia 47,574
Washington 109,527
West Virginia 34,251
Wisconsin 30,100

In 1976, after Darlene gave birth to their second child, her husband told her that he was not allowed to bring his work clothes home anymore. DuPont, he said, had found out that PFOA was causing health problems for women and birth defects in children. Darlene would remember this six years later when, at 36, she had to have an emergency hysterectomy and again eight years later, when she had a second surgery. When the strange letter from the water district arrived, Darlene says, ''I kept thinking back to his clothing, to my hysterectomy. I asked myself, what does DuPont have to do with our drinking water?''

Joe called the West Virginia Department of Natural Resources (''They treated me like I had the plague''), the Parkersburg office of the state's Department of Environmental Protection (''nothing to worry about''), the water division (''I got shut down''), the local health department (''just plain rude''), even DuPont (''I was fed the biggest line of [expletive] anybody could have been fed''), before a scientist in the regional E.P.A. office finally took his call.

''Good God, Joe,'' the scientist said. ''What the hell is that stuff doing in your water?'' He sent Kiger information about the Tennant lawsuit. On the court papers Kiger kept seeing the same name: Robert Bilott, of Taft Stettinius & Hollister, in Cincinnati.

Bilott had anticipated suing on behalf of the one or two water districts closest to Washington Works. But tests revealed that six districts, as well as dozens of private wells, were tainted with levels of PFOA higher than DuPont's own internal safety standard. In Little Hocking, the water tested positive for PFOA at seven times the limit. All told, 70,000 people were drinking poisoned water. Some had been doing so for decades.

But Bilott faced a vexing legal problem. PFOA was not a regulated substance. It appeared on no federal or state list of contaminants. How could Bilott claim that 70,000 people had been poisoned if the government didn't recognize PFOA as a toxin - if PFOA, legally speaking, was no different than water itself? In 2001, it could not even be proved that exposure to PFOA in public drinking water caused health problems. There was scant information available about its impact on large populations. How could the class prove it had been harmed by PFOA when the health effects were largely unknown?

The best metric Bilott had to judge a safe exposure level was DuPont's own internal limit of one part per billion. But when DuPont learned that Bilott was preparing a new lawsuit, it announced that it would re-evaluate that figure. As in the Tennant case, DuPont formed a team composed of its own scientists and scientists from the West Virginia Department of Environmental Protection. It announced a new threshold: 150 parts per billion.

Bilott found the figure ''mind-blowing.'' The toxicologists he hired had settled upon a safety limit of 0.2 parts per billion. But West Virginia endorsed the new standard. Within two years, three lawyers regularly used by DuPont were hired by the state D.E.P. in leadership positions. One of them was placed in charge of the entire agency. ''The way that transpired was just amazing to me,'' Bilott says. ''I suppose it wasn't so amazing to my fellow counsel in West Virginia who know the system there. But it was to me.'' The same DuPont lawyers tasked with writing the safety limit, Bilott said, had become the government regulators responsible for enforcing that limit.

Bilott devised a new legal strategy. A year earlier, West Virginia had become one of the first states to recognize what is called, in tort law, a medical-monitoring claim. A plaintiff needs to prove only that he or she has been exposed to a toxin. If the plaintiff wins, the defendant is required to fund regular medical tests. In these cases, should a plaintiff later become ill, he or she can sue retroactively for damages. For this reason, Bilott filed the class-action suit in August 2001 in state court, even though four of the six affected water districts lay across the Ohio border.

Meanwhile the E.P.A., drawing from Bilott's research, began its own investigation into the toxicity of PFOA. In 2002, the agency released its initial findings: PFOA might pose human health risks not only to those drinking tainted water, but also to the general public - anyone, for instance, who cooked with Teflon pans. The E.P.A. was particularly alarmed to learn that PFOA had been detected in American blood banks, something 3M and DuPont had known as early as 1976.

By 2003 the average concentration of PFOA in the blood of an adult American was four to five parts per billion. In 2000, 3M ceased production of PFOA. DuPont, rather than use an alternative compound, built a new factory in Fayetteville, N.C., to manufacture the substance for its own use.

... ... ...

As part of its agreement with the E.P.A., DuPont ceased production and use of PFOA in 2013. The five other companies in the world that produce PFOA are also phasing out production. DuPont, which is currently negotiating a merger with Dow Chemical, last year severed its chemical businesses: They have been spun off into a new corporation called Chemours. The new company has replaced PFOA with similar fluorine-based compounds designed to biodegrade more quickly - the alternative considered and then discarded by DuPont more than 20 years ago. Like PFOA, these new substances have not come under any regulation from the E.P.A. When asked about the safety of the new chemicals, Chemours replied in a statement: ''A significant body of data demonstrates that these alternative chemistries can be used safely.''

Last May, 200 scientists from a variety of disciplines signed the Madrid Statement, which expresses concern about the production of all fluorochemicals, or PFASs, including those that have replaced PFOA. PFOA and its replacements are suspected to belong to a large class of artificial compounds called endocrine-disrupting chemicals; these compounds, which include chemicals used in the production of pesticides, plastics and gasoline, interfere with human reproduction and metabolism and cause cancer, thyroid problems and nervous-system disorders. In the last five years, however, a new wave of endocrinology research has found that even extremely low doses of such chemicals can create significant health problems. Among the Madrid scientists' recommendations: ''Enact legislation to require only essential uses of PFASs'' and ''Whenever possible, avoid products containing, or manufactured using, PFASs. These include many products that are stain-resistant, waterproof or nonstick.''

When asked about the Madrid Statement, Dan Turner, DuPont's head of global media relations, wrote in an email: ''DuPont does not believe the Madrid Statement reflects a true consideration of the available data on alternatives to long-chain perfluorochemicals, such as PFOA. DuPont worked for more than a decade, with oversight from regulators, to introduce its alternatives. Extensive data has been developed, demonstrating that these alternatives are much more rapidly eliminated from the body than PFOA, and have improved health safety profiles. We are confident that these alternative chemistries can be used safely - they are well characterized, and the data has been used to register them with environmental agencies around the world.''

Every year Rob Bilott writes a letter to the E.P.A. and the West Virginia D.E.P., urging the regulation of PFOA in drinking water. In 2009, the E.P.A. set a ''provisional'' limit of 0.4 parts per billion for short-term exposure, but has never finalized that figure. This means that local water districts are under no obligation to tell customers whether PFOA is in their water. In response to Bilott's most recent letter, the E.P.A. claimed that it would announce a ''lifetime health advisory level for PFOA'' by ''early 2016.''

This advisory level, if indeed announced, might be a source of comfort to future generations. But if you are a sentient being reading this article in 2016, you already have PFOA in your blood. It is in your parents' blood, your children's blood, your lover's blood. How did it get there? Through the air, through your diet, through your use of nonstick cookware, through your umbilical cord. Or you might have drunk tainted water. The Environmental Working Group has found manufactured fluoro­chemicals present in 94 water districts across 27 states (see sidebar beginning on Page 38). Residents of Issaquah, Wash.; Wilmington, Del.; Colorado Springs; and Nassau County on Long Island are among those whose water has a higher concentration of fluorochemicals than that in some of the districts included in Rob Bilott's class-action suit. The drinking water in Parkersburg itself, whose water district was not included in the original class-action suit and has failed to compel DuPont to pay for a filtration system, is currently tainted with high levels of PFOA. Most residents appear not to know this.

Where scientists have tested for the presence of PFOA in the world, they have found it. PFOA is in the blood or vital organs of Atlantic salmon, swordfish, striped mullet, gray seals, common cormorants, Alaskan polar bears, brown pelicans, sea turtles, sea eagles, Midwestern bald eagles, California sea lions and Laysan albatrosses on Sand Island, a wildlife refuge on Midway Atoll, in the middle of the North Pacific Ocean, about halfway between North America and Asia.

''We see a situation,'' Joe Kiger says, ''that has gone from Washington Works, to statewide, to the United States, and now it's everywhere, it's global. We've taken the cap off something here. But it's just not DuPont. Good God. There are 60,000 unregulated chemicals out there right now. We have no idea what we're taking.''

Bilott doesn't regret fighting DuPont for the last 16 years, nor for letting PFOA consume his career. But he is still angry. ''The thought that DuPont could get away with this for this long,'' Bilott says, his tone landing halfway between wonder and rage, ''that they could keep making a profit off it, then get the agreement of the governmental agencies to slowly phase it out, only to replace it with an alternative with unknown human effects - we told the agencies about this in 2001, and they've essentially done nothing. That's 14 years of this stuff continuing to be used, continuing to be in the drinking water all over the country. DuPont just quietly switches over to the next substance. And in the meantime, they fight everyone who has been injured by it.''

Bilott is currently prosecuting Wolf v. DuPont, the second of the personal-injury cases filed by the members of his class. The plaintiff, John M. Wolf of Parkersburg, claims that PFOA in his drinking water caused him to develop ulcerative colitis. That trial begins in March. When it concludes, there will be 3,533 cases left to try.

Nathaniel Rich is a contributing writer for the magazine and the author of ''Odds Against Tomorrow.'' He lives in New Orleans and is a frequent contributor to The New York Review of Books and The Atlantic.

[Jan 14, 2016] Neoliberalism was also economics departments orthodoxy for decades

Notable quotes:
"... It should never be forgotten that the conservative orthodoxy -- of low taxes on the wealthiest, deregulation of finance, small govt deficits, and the need for inequality to spur individual initiative -- was also economics departments orthodoxy for decades. Economists put their imprimatur on this whole mess, with VERY few exceptions. ..."
"... 70% of the population STILL believes that federal deficits are a big problem, and also believes that this is standard economic orthodoxy. Until the crash, most people were ready to accept some degree of privatization of Social Security, and Martin Feldstein pushed on this repeatedly with no counterargument from the economics departments. The Clinton economic team was instrumental in pushing financial deregulation, upon the supposed orthodoxy that it is good for the economy. Even the worst nonsense in Friedmans Capitalism and Freedom and Free to Choose barely saw any push-back from other economists in the op-ed pages. ..."
"... Reaganomics was approved by most economists either through mood affiliation or intellectual incompetence. That 70% currently includes college graduates who took economics classes and traders on Wall Street. ..."
"... Nonsense. Polls of profession economists opinions abound. Reaganomics/neoliberalism has predominated in economics until recently. On a few big issues (notably, on whether the size of federal deficits as % of GDP should be reduced) the split remained even. ..."
economistsview.typepad.com

Lee A. Arnold :

It should never be forgotten that the "conservative orthodoxy" -- of low taxes on the wealthiest, deregulation of finance, small gov't deficits, and the need for inequality to spur individual initiative -- was also "economics departments orthodoxy" for decades. Economists put their imprimatur on this whole mess, with VERY few exceptions.

It's been a first-rate intellectual scandal, perpetrated by some of the biggest names in the economics racket, and with most of the lesser lights tagging along, for fear of ostracism.

And most of them STILL don't have a clear view of what the real problems are.

Lee A. Arnold -> anne...
70% of the population STILL believes that federal deficits are a big problem, and also believes that this is standard economic orthodoxy. Until the crash, most people were ready to accept some degree of privatization of Social Security, and Martin Feldstein pushed on this repeatedly with no counterargument from the economics departments. The Clinton economic team was instrumental in pushing financial deregulation, upon the supposed orthodoxy that it is good for the economy. Even the worst nonsense in Friedman's "Capitalism and Freedom" and "Free to Choose" barely saw any push-back from other economists in the op-ed pages.

"Conservative orthodoxy" can be laid squarely at the feet of the economics departments, up until the crash. If the ones who are supposed to know better, don't make a concerted effort to refute the tons of nonsense spouted in the name of economics, then they should resign their tenure.

Lee A. Arnold -> pgl...
It most certainly WAS taken as the orthodoxy. Reaganomics was approved by most economists either through mood affiliation or intellectual incompetence. That 70% currently includes college graduates who took economics classes and traders on Wall Street.
pgl -> Lee A. Arnold ...
"Reaganomics was approved by most economists either through mood affiliation or intellectual incompetence."

Not even remotely true. Criticized by liberal economists. Blasted by the conservative economists who refused to work for the Reagan White House. Even blasted by a young Greg Mankiw but that is before he drank the Bush Kool Aid.

Lee - your claim here is just wrong. And the more you defend it, the worse it gets.

Lee A. Arnold -> pgl...
Nonsense. Polls of profession economists' opinions abound. Reaganomics/neoliberalism has predominated in economics until recently. On a few big issues (notably, on whether the size of federal deficits as % of GDP should be reduced) the split remained even.

(1992 -- responses from 464 US economists):

  • "A large federal budget deficit has an adverse effect on the economy" 78.7% agree (includes 'agree with provisos').
  • "The money supply is a more important target that interest rates for monetary policy" 56.7% agree.
  • "As the USSR moves toward a market economy. a rapid and total reform (i.e., "going cold turkey") would result in a better outcome than a slow transition" 57.6% agree.
  • "A minimum wage increases unemployment among young and unskilled workers" 78.9% agree.
  • "An economy in short-run equilibrium at a real GNP below potential GNP has a self-correcting mechanism that will eventually return it to potential GNP" 50.8% agree.
  • "Changes in aggregate demand affect real GNP in the short run but not in the long run" 52.8% agree.
  • "Lower marginal income tax rates reduce leisure and increase work effort" 55.4% agree. (Alston et al., "is there a global economic consensus?" AEA Papers and Proceedings, 1992)

[Jan 13, 2016] ObamaCare's Neoliberal Intellectual Foundations Continue to Crumble

Notable quotes:
"... By Lambert Strether of Corrente . ..."
"... ObamaCare is a Bad Deal (for Many) ..."
"... they do not comparison shop. ..."
"... very ..."
"... Obama was never in favor of single payer, ever. Wash your mouth out for even suggesting that ..."
"... He had health care lobbyists draft the legislation ..."
"... thatworddoesnotmeanthat ..."
"... The United States National Health Care Act, HR 676 ..."
www.nakedcapitalism.com
Posted on January 12, 2016 by Lambert Strether By Lambert Strether of Corrente .

ObamaCare is, of course, a neoliberal "market-based" "solution." ObamaCare's intellectual foundations were expressed most clearly in layperson's language by none other than the greatest orator of our time, Obama, himself ( 2013 ):

If you don't have health insurance, then starting on October 1st, private plans will actually compete for your business, and you'll be able to comparison-shop online.There will be a marketplace online, just like you'd buy a flat-screen TV or plane tickets or anything else you're doing online, and you'll be able to buy an insurance package that fits your budget and is right for you.

Let's leave aside the possibility that private plans are phishing for your business, by exploiting informational asymmetries, rather than "competing" for it. Obama gives an operational definition of a functioning market that assumes two things: (1) That health insurance, as a product, is like flat-screen TVs, and (2) as when buying flat-screen TVs, people will comparison shop for health insurance, and that will drive health insurers to compete to satisfy them. As it turns out, scholars have been studying both assumptions, and both assumptions are false. "The dog won't eat the dog food," as marketers say. This will be a short post; we've already seen that the first assumption is false - only 20%-ers who have their insurance purchased for them by an institution could be so foolish as to make it - and a new study shows that the second assumption is false, as well.

ObamaCare's Product Is Not Like a Flat-Screen TV

Here's the key assumptoin that Obama (and most economists) make about heatlth insurance: That it's a commodity, like flat screen TVs, or airline tickets, and that therefore , there exists a "a product that suits your budget and is right for you" because markets. Unfortunately, experience backed up by studies has shown that this is not true. From ObamaCare is a Bad Deal (for Many) . From Mark Pauly, Adam Leive, Scott Harrington, all of the Wharton School, NBER Working Paper No. 21565 ( quoted at NC in October 2015 ):

This paper estimates the change in net (of subsidy) financial burden ("the price of responsibility") and in welfare that would be experienced by a large nationally representative sample of the "non-poor" uninsured if they were to purchase Silver or Bronze plans on the ACA exchanges. The sample is the set of full-year uninsured persons represented in the Current Population Survey for the pre-ACA period with incomes above 138 percent of the federal poverty level. The estimated change in financial burden compares out-of-pocket payments by income stratum in the pre-ACA period with the sum of premiums (net of subsidy) and expected cost sharing (net of subsidy) for benchmark Silver and Bronze plans, under various assumptions about the extent of increased spending associated with obtaining coverage. In addition to changes in the financial burden, our welfare estimates incorporate the value of additional care consumed and the change in risk premiums for changes in exposure to out-of-pocket payments associated with coverage, under various assumptions about risk aversion. We find that the average financial burden will increase for all income levels once insured. Subsidy-eligible persons with incomes below 250 percent of the poverty threshold likely experience welfare improvements that offset the higher financial burden, depending on assumptions about risk aversion and the value of additional consumption of medical care. However, even under the most optimistic assumptions, close to half of the formerly uninsured (especially those with higher incomes) experience both higher financial burden and lower estimated welfare ; indicating a positive "price of responsibility" for complying with the individual mandate. The percentage of the sample with estimated welfare increases is close to matching observed take-up rates by the previously uninsured in the exchanges.

So, for approximately half the "formerly uninsured," ObamaCare is a losing proposition; I don't know what an analogy for flat-screen TVs is; maybe having to send the manufacturer money every time you turn it on, in addition to the money you paid to buy it? That's most definitely not a "package that fits your budget and is right for you," unless you're a masochist or a phool. Second, the portion of those eligible that does the math probably won't buy the product if they're rational actors (and Obamaare needs to double its penetration of the eligible to avoid a death spiral ). That again is not like the market for flat-screen TVs; the magic of the ObamaCare marketplace has not operated to produce a product at every price point (or a substitute).[1] Bad marketplace! Bad! Bad!

Health Care "Consumers" Tend not to Comparison Shop

We turn now to a second NBER study that places even more dynamite at ObamaCare's foundations. From Zarek C. Brot-Goldberg, Amitabh Chandra, Benjamin R. Handel, and Jonathan T. Kolstad, of Berkelely and Harvard, "What Does a Deductible Do? The Impact of Cost-Sharing on Health Care Prices, Quantities, and Spending Dynamics" NBER Working Paper No. 21632 ( PDF ), the abstract:

Measuring consumer responsiveness to medical care prices is a central issue in health economics and a key ingredient in the optimal design and regulation of health insurance markets. We study consumer responsiveness to medical care prices, leveraging a natural experiment that occurred at a large self-insured firm which required all of its employees to switch from an insurance plan that provided free health care to a non-linear, high deductible plan[2]. The switch caused a spending reduction between 11.79%-13.80% of total firm-wide health spending. We decompose this spending reduction into the components of (i) consumer price shopping (ii) quantity reductions and (iii) quantity substitutions, finding that spending reductions are entirely due to outright reductions in quantity. We find no evidence of consumers learning to price shop after two years in high-deductible coverage. Consumers reduce quantities across the spectrum of health care services, including potentially valuable care (e.g. preventive services) and potentially wasteful care (e.g. imaging services). We then leverage the unique data environment to study how consumers respond to the complex structure of the high-deductible contract. We find that consumers respond heavily to spot prices at the time of care, and reduce their spending by 42% when under the deductible, conditional on their true expected end-of-year shadow price and their prior year end-of-year marginal price. In the first-year post plan change, 90% of all spending reductions occur in months that consumers began under the deductible, with 49% of all reductions coming for the ex ante sickest half of consumers under the deductible, despite the fact that these consumers have quite low shadow prices. There is no evidence of learning to respond to the true shadow price in the second year post-switch.

So, empirically, these "consumers" just don't act the way that good neoliberal Obama says they should; they do not comparison shop. That alone is enough to undermine the intellectual basis of ObamaCare. If there's no comparison shopping going on, there's no competitive pressure for health insurers to improve their product (assuming good faith, which I don't).

(We can leave aside the issue of motivation, but to speculate, I've found that when I talk to people about health care and health insurance; they're very defensive and proprietary about whatever random solution they've been able to cobble together; and if you'd been sold an exploding flat-screen TV, and had somehow been able to use duct tape and a well-timed fist to the housing to get it work, most of the time, wouldn't you be rather unwilling to go back to the same store and buy another? So there is evidence of "learning"; the lesson learned is once you've got something that seems to works, don't on any account change it, and we "bear those ills we have," rather "than fly to others that we know not of.")

Moreover, the population studied has more ability to comparison shop than ObamaCare's. From page 4 of the study :

Employees at the firm [in the study] are relatively high income ( median income $125,000-$150,000 ), an important fact to keep in mind when interpreting our analysis

The top income for a family of four eligible for ObamaCare is around $95K (and not eligible for subsidy). Do people think this ObamaCare-eligible population has more ability to comparison shop, compared to a population with a $125K median income for individuals, or less ability? To put this more tendentiously, if a population that can afford accountants or at least financial planners doesn't comparison shop, how likely is it that a population that cannot afford those personal services will do so?

Even worse, the population studied reduces costs, not by comparison shopping, but by self-denial of care. From page 6 of the study :

In our setting consumers were provided a comprehensive price shopping tool that allowed them to search for doctors providing particular services by price as well as other features (e.g. location).

So, just like the ObamaCare "marketplace online" front end (at least after they got it working). And what happened?

We find no evidence of price shopping in the first year post switch . The effect is near zero and looks similar for the t -1 - t 0 year pair (moving from pre- to post-change) as it does for earlier year pairs from t 4 to t 1 . Second, we find no evidence of an increase in price shopping in the second year post-switch; consumers are not learning to shop based on price. Third, we find that essentially all spending reductions between t 1 and t 0 are achieved through outright quantity reductions whereby consumers receive less medical care . From t 1 to t 0 consumers reduce service quantities by 17.9%. Fourth, there is limited evidence that consumers substitute across types of procedures (substitution leads to a 2.2% spending reduction from t 1 - t 0 ). Finally, fifth, we find that these quantity reductions persist in the second-year post switch, as the increase in quantities between t 0 and t 1 is only 0.7%, much lower than the pre-period trend in quantity growth. These results occur in the context of consistent (and low) provider price changes over the whole sample period.

Now, it could be that the study population is reducing items like cosmetic surgery and not items like dental care (assuming they've got dental); the Healthcare Economist summary of this study says no. In fact, says the study, some of the foregone services were "likely of high value in terms of health and potential to avoid future costs." And it could be that the lower-income ObamaCare-eligible are smarter shoppers (dubious: Shopping is a tax on time a lot of working people can't pay). That said, it looks like ObamaCare has replaced a system where insurance companies deny people needed care with a system where people deny themselves needed care; which is genius, in a way. However, if any doctors or medical personnel continue to support ObamaCare politically, they should consider closely whether they're violating the principle of non-maleficence - "First, do no harm" - and halt their support, if so. Bad marketplace! Bad, bad!

Conclusion

Shopping for health insurance under ObamaCare is nothing at all like shopping for a flat-screen TV. First, there's a sizeable population who, if they are rational actors, just won't buy health insurance at all; the ObamaCare "marketplace" is not capable of adjusting prices to get such "consumers" to enter the market. Second, people don't comparison shop; they reduce needed care. (To flog the flat-screen TV metaphor even further, if the screen is so defective it's painful to watch, people don't reduce the pain by comparison shopping for a better TV; they reduce the pain by watching less, and keep the TV they have.)

So, with ObamaCare, and thanks to the dogmas of neoliberalism, we have a "marketplace" that repels "consumers" from entering it, and repels people from shopping if they do enter. Perhaps there's a better solution out there?

NOTES

[1] It may be that the ever-increasing mandate penalties will force enough people into the marketplace to make ObamaCare actuarially stable ; needless to say, we don't see Federal agents forcing people into Best Buy to buy TVs, although the social pressure of Black Friday comes close.

[2] Again, much like ObamaCare plans, which are increasingly high-deductible.

Health care , Market inefficiencies on January 12, 2016 by Lambert Strether .

About Lambert Strether

Lambert Strether has been blogging, managing online communities, and doing system administration 24/7 since 2003, in Drupal and WordPress. Besides political economy and the political scene, he blogs about rhetoric, software engineering, permaculture, history, literature, local politics, international travel, food, and fixing stuff around the house. The nom de plume "Lambert Strether" comes from Henry James's The Ambassadors: "Live all you can. It's a mistake not to." You can follow him on Twitter at @lambertstrether. http://www.correntewire.com

View all posts by Lambert Strether →

brian t , January 12, 2016 at 3:23 am

The author seems to have forgotten that the kludge called "Obamacare" is not the single payer solution that this Obama wanted. What you have is what was able to get past a Congress after intense lobbying by HMOs and insurers. I see little evidence of ideology in the result, "neoliberal" or otherwise. It does nothing to address the insane-and-rising cost of healthcare, because the vested interests are OK with that.

Yves Smith , January 12, 2016 at 5:12 am

Let me clue you in: the readers here are way WAY too clued in to buy your Big Lie.

1. Obama was never in favor of single payer, ever. Wash your mouth out for even suggesting that

2. He had health care lobbyists draft the legislation

3. He used the "public option" as a bright shiny toy. He was so uncommitted to it he didn't even trade it away. He gave it up as a free concession. A basic principle in negotiating is you NEVER make a free concession. The fact that he just threw it away is proof he never meant it as anything more than a talking point

I hope you are paid to dispense this blather. I really feel sorry for you if you actually believe it. Obama is a neoliberal who campaigned as a leftist but has governed as a right-winger. His apologists have regularly used the meanie Republicans as excuses for his selllouts, when Obama gets what he wants when he wants it, and there's no evidence that his center-right results are at all at odds with what he intended to achieve.

Linc , January 12, 2016 at 8:33 am

I won't pretend to be as smart as you and I was doing okay with your comments until the following. "Obama is a neoliberal who campaigned as a leftist but has governed as a right-winger." You're kidding? I won't ask for an example because I am sure there are a few issues you can name and discuss. That being said, Obama is no where near the middle, never mind the right. If anything, I would say Obama is an inexperience professor trying to teach Economics at Wharton….he can't. The problem is Obama is too narcissitc to even think about listening. He has constantly picked situations because it is what he believes and that includes the simple things such as inviting the Harvard professor who was arrested early on in his presidency for a beer to the WH to giving how many millions to Solyndra. He can't be wrong!

As far as Obamacare. To me it is a simple issue. Health Care does not equal Health Insurance. The sad part is we have spent billions in what will eventually end up as quasi single payer system with 4 large insurance companies sharing the administrative function. Let's just get there and quit kidding one another.

Yves Smith , January 12, 2016 at 4:31 pm

Huh? Obama has proven to be an extremely skilled political infighter when he wants something done. And as to him being center-right, all you have to do is look at his staff, most important his economics team.

He's got a history of being a fake leftist going back to his days in Chicago. Obama, Michelle, and Valerie Jarrett were the black faces that legitimated the plan by the Pritzkers and local finance interests to gentrify near South Chicago and push the black community 3 miles further south while giving them nothing. See here for details:

http://www.nakedcapitalism.com/2012/05/exclusive-how-obamas-early-career-succes-was-built-on-fronting-for-chicago-real-estate-and-finance.html

And he's never been a real prof. This constitutional law talk is a crock. No one can remember him teaching any courses (he appears to have taught a couple but made no impression). This was a resume-burnishing post and he did the bare minimum.

Hayek's Heelbiter , January 12, 2016 at 12:55 pm

Beg to slightly differ regarding Obama and single payer (if the transcripts of his campaign rally speech in Jersey City before he was nominated hadn't been scrubbed from the Internet, I'd have the exact wording).

After he had had told the story of sitting with his dying mother on her death bed, surrounded by paperwork, trying to sort out the restrictions of her employer-based insurance policy and there wasn't a dry eye in the gymnasium, everyone THOUGHT he said, "When I am President, I will fight tooth and nail for single payer for every single American."

And the gymnasium absolutely erupted in applause.

Apparently, he said something very CLOSE to that, but when the sentence is carefully parsed, did not mean that all.

Nevertheless, as a former Obot who worked tirelessly to get him elected on almost the sole basis of the genuine emotion he exhibited when he told this awful story and how he promised to rectify the situation in the future, I felt the dagger of betrayal when the first thing he said during the health care debate was, "I'm taking single payer of the table."

Lambert Strether Post author , January 12, 2016 at 1:58 pm

I hate to say this, but a lot of us at Corrente did try to keep track in 2008, and I can't remember any reporting on this at the time, and we were also strongly for single payer, which we also kept track of. Not to say that we couldn't have missed something, but a link to something contemporaneous would be helpful.

Michael Hudson , January 12, 2016 at 2:32 pm

I know that I've said this on NC before, but Yves is absolutely right - and THEN some. When Dennis Kucinich tried to introduce EVEN A DISCUSSION of single payer in Congress, the Democratic Party leadership blocked him from even bringing it up. Pelosi et al. were absolutely committed to the Republican neoliberal policy.
This led us to discuss whether the only way to get progressive health care policy was to start a new party, now that the Democrats have become the Wall Street wing of the Republican Party's natural resource monopolists.

Hayek's Heelbiter , January 12, 2016 at 3:37 pm

If you could locate a transcript, I would dearly love to read what he ACTUALLY said.

Cameras and recording devices were strictly forbidden, and this was in the days before everyone had cellphones that could record anything.

meeps , January 12, 2016 at 6:44 pm

I don't know the date of this speech (the upload predates the 2010 debacle), but Obama stated, "I happen to be a proponent of single payer health care…"

That said, we got hosed. Each of us must now decide whether to roll over and take the corn, or, to demand single payer and the re-regulation of industry (the pharmaceutical industry and others that affect health tangentially).

meeps , January 12, 2016 at 7:09 pm

meeps , January 12, 2016 at 7:38 pm

I've not been able to resolve the technical reason behind my missing links. You'll find the 53 second clip on youtube channel 6y2o12la titled: Obama on single payer health insurance.

sierra7 , January 12, 2016 at 1:57 pm

Oh, My! My!
Thank you Yves!!!!!!!!
You go to (as you are now) the head of the class!

nigelk , January 12, 2016 at 2:33 pm

One imagines Yves with a large staff and flowing robe…

"O-bots…YOU…SHALL…NOT…PASS!"

barutanseijin , January 12, 2016 at 5:28 am

You mean vested interests as represented by Obama and the Democrats.

Paul P , January 12, 2016 at 5:40 am

"the single payer solution that this Obama wanted"

Obama kept single payer off the table from the start. He would have had to decide to fight the industry and take the fight to the country. Medicare for All is a simple idea. He could have done a 50 state whistle stop tour. He could have saturated any Congressional district opposing Medicare for All with the same message. That wasn't his plan.

I attended one of his community meetings on health care, held around the country prior to him adopting Romney Care as his proposal. One of the organizers of the meeting starts off by complaining to the group about not just telling Obama we want single payer.

cwaltz , January 12, 2016 at 9:09 am

One of the first things Obama did was make the GOP party point men on health care(Olympia Snowe anyone?)

And it was Nancy Pelosi who called it impractical and took it off the table, heck she even went so far as to have some of the activists committed to being heard arrested for being disruptive. She then promptly gave a minority Blue Dog group the opportunity to co opt the debate to grandstand on abortion.

It's positively revisionism to blame the health care mess on GOP. It was Democrats who screwed it up from start to finish.

Paper Mac , January 12, 2016 at 6:11 am

The first step is admitting you have a problem, brian.

Myron Perlman , January 12, 2016 at 8:58 am

"Obama wanted'? Single payer was ruled out from the beginning. Advocates for that position were not permitted to be part of the discussion. Who knows what Obama wanted? Look at his actions on this and other issues to make a better judgment. My take is that it was a presidency of symbolism not substance when it came to policies.

Lambert Strether Post author , January 12, 2016 at 11:47 am

Not to pile on or anything, but I think a review of the bidding is in order:

I suggest the real constraints came from three sources, as indicated by their behavior from 2009, when battle for health reform was joined: (1) The Democratic nomenklatura , which censored single payer stories and banned single payer advocates from its sites , and refused even to cover single payer advances in Congress , while simultaneously running a "bait and switch" operation with the so-called "public option," thereby sucking all the oxygen away from single payer; 1 (2) Democratic office holders like Max Baucus, the putative author of ObamaCare - Liz Fowler, a Wellpoint VP, was the actual author - who refused to include single payer advocates in hearings and had protesters arrested and charged ; (3) and Obama himself , who set the tone for the entire Democratic food chain by openly mocking single payer advocates ( "got the little single payer advocates up here" ), and whose White House operation blocked email from single payer advocates , and went so far as to suppress a single payer advocate's question from the White House live blog of a "Forum on Health Care." (Granted, the forums were all kayfabe, but even so.) As Jane Hamsher wrote, summing of the debacle: "The problems in the current health care debate became apparent early on, when single payer advocates were excluded [note, again, lack of agency] from participation."

In short, if single payer was "politically infeasible" - the catchphrase of that time - that's because Democrats set out to make it so, and succeeded.

Brian, could you ask your boss to send us smarter trolls?

nigelk , January 12, 2016 at 2:52 pm

I appreciate that such takedowns are always link-filled and impeccably sourced, and though combativeness in the comments is not the prevailing tone of this website (happily), damn if I don't pump my fist when I read a troll getting cut down thusly.

Fake leftist trolls are the worst.

GlobalMisanthrope , January 12, 2016 at 12:48 pm

Maybe you're not an incredibly lame troll. Maybe you're just a poor beginner who unwittingly wandered onto the Varsity field. But if you "see little evidence of ideology in the result," you may want to look up the definitions of "evidence," "ideology" and "result."

James Levy , January 12, 2016 at 6:17 am

Educated elites with a modicum of leisure always love to play these games. It took them decades and the most draconian policies imaginable to break the habit of workers early in the industrial revolution of trading off pay for leisure time. The basic notion of every capitalist scold throughout the ages has been that this is irrational laziness, even if your job is a physically exhausting and soul-crushing exercise–you must work more, or you are a bad person who should be punished.

Now, it's the "let's turn everything into a market" game. Don't want to play? Screw you–we'll make it mandatory, and, of course, punitive. This goes way beyond Obamacare into every facet of our lives. Public utilities? Hell no–give them "choice"! Community schools? No way–can't have the races and the classes and the ability levels mixing in such a promiscuous manner–let's go charter "academies", or vouchers. It's a normative takeover under the guise of "rational" "scientific" "efficiency".

Jim , January 12, 2016 at 8:54 am

Wow, this is so right!

JustAnObserver , January 12, 2016 at 2:14 pm

Minor correction:

Public utilities? Hell no–give them Lead!

ilporcupine , January 12, 2016 at 6:06 pm

So true. Ask them about their golf game. It is only YOUR leisure time at issue, not theirs. Don't you wish you could count as "work" blathering your stream of conciousness on CNBC day after day?

ambrit , January 12, 2016 at 6:57 am

I remember that one of the 'talking points' in favour of Heritage Foundation Care (HFC) was that "pre-existing" conditions were not to be allowed to deny anyone coverage. Using that logic, it can be asserted that 'Poverty', absolute or relative, a pre-existing condition if there ever was one, denies 'patients' useful medical care. The system as administered is internally contradictory. Taken one step farther, the HFC can be defined as a "Faith Based Service Provider." This would be an insult to actual traditional Faith based providers. Most "real" FBPs are governed, at least in theory, by ideologies that counsel 'compassion' when dealing with the less fortunate. As has been demonstrated, the HFC program counsels exploitation when dealing with the less fortunate. A case in point; this week a local religious charity opened a 'Free Clinic' in our town of 45,000 or so souls. The local paper put this on the front page. Buried in the body of the article was the mention that this clinic was fully booked up for the first, and probably second month. All this before public mention of it's existence. There's your 'Marketplace' in action. As I discovered when I looked into signing up for the Mississippi Medicaid program for myself, a family cannot have over 2,500 USD in 'assets.' There is an ongoing dispute as to whether or not an automobile classifies as an item counted toward this limit. Thus, those in our state who do qualify for Medicaid are poor indeed.

Carolinian , January 12, 2016 at 9:21 am

Using that logic, it can be asserted that 'Poverty', absolute or relative, a pre-existing condition if there ever was one

Great point. In the US we have a health care system that saves people's lives while–in many cases–taking away their means of living it. The Hippocratic Oath should be modified to read: first do no harm to Capitalism.

thatworddoesnotmeanthat , January 12, 2016 at 7:11 am

Obama is a 1060s style communist;==perhaps one could call him a "NeoCommunist" Obamacare is anything but "Neoliberal" –it is redistributionist in its very nature. This is why it is crumbling. It is an absurd notion as is this article, but that is to be expected as you cannot seem to get over this adolescent attachment to Marxism.

Lambert Strether Post author , January 12, 2016 at 11:29 am

You mean pre-Norman Conquest? Interesting.

nigelk , January 12, 2016 at 2:54 pm

William of Normandy, a notorious leftist prior to his hard pivot to militarism after the 1066 election

Ulysses , January 12, 2016 at 3:01 pm

"Election!" That's a good name for it. Hustings, Hastings, I mean, only one letter separates them!

Ulysses , January 12, 2016 at 2:58 pm

Yes, it is an intriguing suggestion. Does commenter thatworddoesnotmeanthat care to elaborate? Were the architects of RomneyCare (and it's national extension Obamacare) attempting to recreate a golden age, of 11th century free peasants– happily enjoying the abundant commons of medical care, in the carefree forests and dales, before they slipped under the Norman Yoke of feudal exploitation?

Or, is the reference to some non-Western communist society that flourished in the mid-11th century? Perhaps thatworddoesnotmeanthat has studied early communist cultures in South Asia, America, or Africa that distributed healthcare in a way that eerily foreshadows what Romneycare did in Massachusetts?

diptherio , January 12, 2016 at 11:56 am

Obama is a [1960s] style communist


You keep using that word….

James Levy , January 12, 2016 at 1:36 pm

The record is irrefutable–the ACA was written by the insurance companies with a wink and a nod to Big Pharma and the HMOs. Unless you are going to seriously entertain the notion that these are "communist" institutions, or give a rats ass about anything but making money, you can't really believe what you wrote. You are just angry about something and projecting your fears onto this travesty.

Disturbed Voter , January 12, 2016 at 7:37 am

The subsidies of Obamacare, if you qualify for them, requires the IRS to get intimately involved with your checkbook. Just like middle class folks want recipients of SNAP to be regulated with every food and drink purchase … matching what the bourgeoisie thinks matches their own moral rectitude.

I prefer not to make the IRS my intimate partner … helping me to define what is an asset and what is income to the last penny.

Wade Riddick , January 12, 2016 at 8:12 am

The idea behind high deductibles is that you'll force consumers to economize. It's kind of like telling science, "Hey. This patient needs ten pills to live? Let's give him eight and see what happens."

Medical treatment is a science issue. A treatment's either effective or it's not. You can negotiate the cost – *with the supplier* – but you can't bully a disease or injury into behaving the way you want. You certainly can't bully the sick person and they're in no position to negotiate with the supplier. They have none of the necessary experience or health. That's exactly the wrong time to try to educate someone about their "options."

But then that's the whole point. The medical market is intentionally littered with opacity. There is nothing transparent about insurance, much less drugs or surgeries. Medicine is increasingly dominated by complex bureaucratic cartels for exactly that reason – so you *won't* find out how things work. They don't want you comparison shopping for drugs, surgeries, therapists. Everything about the modern medical system is precisely about robbing "customers" of human agency.

The whole idea of shopping for health insurance itself is absurd. It requires you figuring out exactly how sick you'll be in the next year and then inventing a time machine to travel back so you can pick the Pareto optimal policy with exactly the best deductible – which really won't matter because then they'll find a way to make sure your E.R. wasn't in network nor your anesthesiologist and the only drug to keep you alive won't be "covered" and then you'll wish it was only an Arnold Schwarzenegger skin-wearing android sent to kill you 'cause that would be way easier.

They're removing choice left and right and destroying scientific information through lobbying. The people responsible for creating diseases aren't being held responsible for them but the victims suffering from them are.

When multiple sclerosis organizations are run by drug companies selling $50K+ a year drugs, do you think they want those customers finding out that deworming society is what created the risk for M.S. in the first place?

As Martin Shkreli put it, he has the perfect "price inelastic" product. Patients are a captive market that's easy to exploit. Either they get what they need or they die. You can charge what you want.

Do you think lazy executives looking to bump up next quarter's earnings are going to invest heavily over the long haul in scientific models of effective disease prevention and treatment or are they simply going to squeeze people a little more and a little more?

Let's not forget why politicians love the sickcare complex. The more an industry turns into a cartel, the easier it is to raise both economic and political rents from it. Let's be honest here and call a spade a spade. Politicians like this system because it easily feeds campaign dollars into the system. It may not be efficient for treating patients, but it's quite efficient for extracting political re

Crazy Horse , January 12, 2016 at 12:48 pm

Comparison shop for medical care in the USA? You've got to be kidding.

Case in point. My doctor recommended a cardiovascular "stress test" for diagnosis of heartburn symptoms to make sure that it wasn't cardiovascular in nature. I traveled to a regional heart specialist center for the test, but based upon previous experience refused to undergo the test until they put the bill for the procedure in writing including my deductible cost. The intake administrator acted shocked by such a request, and it took 30 minutes of increasingly strongly worded demands on my part before they finally produced a verbal quotation – which I recorded for future use if they decided to bill $12,000 for 10 minutes on a treadmill.

The world's most expensive health care extortion system at work.

Jim Haygood , January 12, 2016 at 1:49 pm

NBER: 'There is no evidence of learning.'

As Barry O. likes to joke, mimicking George W. Bush's drawl, "Is our consumers learning? Ha ha ha!"

Wade Riddick , January 12, 2016 at 8:15 am

political rents. (Got cut off for some reason. Arnold got me, I think.)

Winston , January 12, 2016 at 8:44 am

It's nearly impossible to "comparison shop" if you're part of an HMO these days. The only choice one really has is to select their PCP. After that the PCP pretty much forces you to see docs and get tests within the hospital system – presumably for "coordinated care". And this for nearly $1000/mo for a single person not receiving much in the way of "healthcare". That which can't continue, won't….

Jim in SC , January 12, 2016 at 8:49 am

One of the things that distinguishes the US from other countries is our high level of tax compliance. I'm concerned that these Obamacare penalties will lead to diminished compliance, both because people resent the penalties, and because it is such an intellectually frustrating exercise to try and estimate future income.

HotFlash , January 12, 2016 at 11:44 am

Perhaps not so ? Can you give me a link? TIA.

Jim in SC , January 12, 2016 at 10:08 pm

http://www.pappastax.com/american-tax-compliance-rates-highest-in-civilized-world/

allan , January 12, 2016 at 9:39 am

More like a flat screen TV, rented from Samsung, that functions like one of those old British hotel radiators that you have to feed with pence $60 copays every 10 minutes in order for Time Warner not to interrupt the streaming.
And then you get balance billing from Disney for the content.

Chromex , January 12, 2016 at 9:42 am

My experience is that there IS no "competition" in any product field that involves actuarial calculations. I get a subsidy and I am 63. There were about 50 plans offered in my area. A few were OVERpriced, yes, but the vast majority offered very similar premium prices, and identical elephantine deductibles, which means that except for aspects of the annual physical, it will "cover" ( assuming cover means pay for) jack. "Coverage" is not care, it is nothing to brag about. I am "covered" for expenses beyond my deductible as a form of catastrophic insurance but the plan will never pay for anything else and actuarially, it is easy to calculate a premium that guarantees that companies will make lotsa money while paying out less. Needless to say the "product" is outrageously overpriced for what it covers and puts people like me _- close to medicare but limited income and owns own house free and clear in a far far worse position than before the law. ( eg medicaid asset recovery if I dare to state a lower income etc etc). So I'm "covered" , so what. I have far less actual care. And that , it appears to me , is deliberate.
Even if it were "competitive" there is not much point in comparison shopping for flat screen tvs.. for a flat screen tv with X features made by brand "A" the price difference for a tv with the same features ( and longevitiy) of brand "B: will in the vast majority of online offerings, be so close as to not be worth the effort. This is even more true with insurance.
Like most politicians, Obama wanted to "do something" and a have a bill he could hold up in front of Everybody and say "see this is mine". My experience with such legislators/administrators is that they have a lot of hubris and grees for the bill to pass and do not subject potential downsides to any critical analysis so that advisers get the message "construct something that will pass" .The fact that he was dumb enough not to see this coming suggests that his "ideology" was driven by his advisers- who are definitely neocons IMO not neoliberals unless the term "liberal" is used in its classic economic sense.
And while we are on the subject, "Health care" is not really subject to "market" principles. Start with the fact that most people in this country have less than 1K savings, which means that they cannot cover the ginormous deductibles most "silver" plans offer or the premiums of better plans. Then add in the fact that these people cannot predict how much care will be needed in a given year or what the final cost of that care will be. What's the "market " for that? Under these two facts mandatory "insurance"with high deductibles and narrow networks simply functions as a wealth transfer from strapped lower-middle and middle class adults to Insurance company shareholders and CEOs.
Even assuming that Obama "wanted" single payer- an assumption that has been ably refuted in this string already, had he given "what can get passed" a moment's critical analysis, he might have realized that he- with his insistence on change for change's sake- was making it worse for so many Americans. I for one , could care less that pre-existing conditions are now "covered" if I can't actually use the coverage- pre existing survives, its now called high deducitlbes and narrow networks.

macman2 , January 12, 2016 at 9:59 am

Actually, as Winston Churchill famously noted, "Americans manage do the right thing after they have exhausted all of the wrong choices firs"t. So it is that had we gone right to single payer without this "market based" attempt, we would have heard howls of capitalistic remorse, etc.

So I am glad that Obamacare was attempted and that it is failing predictably. It is pretty clear to even the free marketers that high deductibles only impoverish Americans, that "skin in the game" does not make people better shoppers for the highly technical world of medicine, that price transparency is essentially worthless if nobody is comparison shopping while they are bleeding out from every orifice, etc.

Medicare for All is arguably catching on. Bernie Sanders poll numbers have not taken a dive with this promise and the sputtering Obamacare is only putting more fuel to this fire. Hillary's tax scare attempt will turn flat on its face. People know bad value when they see it, and the current market based health reform is failing into the predictable death spiral. View Bernie's ascendency as evidence that the American people think health care is a right and it is time to fund it that way.

marym , January 12, 2016 at 12:26 pm

Is the argument here that it was necessary for millions of people to suffer from lack of access to affordable healthcare, and tens of thousands to die, to teach us a lesson, because designing, advocating for, and rapidly deploying a simple, effective single payer system that would bring both immediate and long-term benefits that would silence even its would-be detractors is impossible even to imagine? This is why Democratic Party and Obama cheerleaders have no credibility anymore.

http://www.pnhp.org/news/2015/july/medicare-turns-50-and-we-have-much-to-celebrate

Also, while it's great that Sanders is bringing attention to this topic, it's not surprising that people are responding favorably People have been polling in favor of a Medicare-type single payer program for decades.

http://pnhp.org/blog/2009/12/09/two-thirds-support-3/

James Levy , January 12, 2016 at 1:44 pm

Americans have not and will not "do the right thing" on this issue because the entrenched interests that are making money off of the current atrocity that passes for a healthcare system are too strong to displace. Europe got single payer after WWII because the only institution in society left with access to money was the State, so doctors and hospitals after the war were going to sign on for socialized medicine because societies at large were destitute. Whatever the government will pay is better than grandpa's watch (if some conquering army hadn't stolen it) or a chicken (ditto). Until this situation comes into being here in the USA we're not going to see single payer tax-based healthcare.

Ulysses , January 12, 2016 at 3:13 pm

Your argument would make sense if Canada, which, like the U.S., never suffered the same WWII devastation as Europe, hadn't managed to build a national single-payer health system.

sleepy , January 12, 2016 at 10:16 am

And let's not forget the medicaid clawback provisions for those between 55-65. If you apply for Obamacare, and your income level is below a certain threshhold, you are not eligible for subsidies. You are placed into medicaid.

However, for those in that 55-65 age bracket, there is an estate clawback provision that effectively acts as a lien on your estate: once you die your assets will be seized by the state to satisfy all medicaid provided healthcare expenses.

Prior to Obamacare, in order to qualify for medicaid, not only was there an income requirement, but your assets also had to be below a certain, very low, amount. With Obamacare however, the asset requirement is waived for those in that age bracket.

What happens? Many who now are eligible for medicaid via Obamacare will now own a house as their primary asset of any significance. But once enrolled, that house will be sold on the insured's death to pay medicaid. I would assume that in states that have privatized medicaid, these sums will also include all premiums paid by medicaid on the insured's behalf-even if no claims are ever filed.

If that's not bad enough, under Obamacare to satisfy the law, the consumer is forced into this by the mandate. There is no choice. Beyond that, if the insured had an income level a few dollars higher, he/she would be eligible for subsidies which, of course, need not be paid back on the insured's death.

Clawback provisions, though with many exceptions particularly for those under age 55 have always been required under medicaid, but now medicaid enrollment will be required by law with actual assets available.

Medicaid is essentially a reverse mortgage.

sleepy , January 12, 2016 at 10:31 am

In terms of the assets issue, my comment is applicable to those states that have adopted the expanded medicaid features of Obamacare. As mentioned by a poster in Mississippi, states that have not, still have the old rules on having virtually no assets in order to qualify.

Spring Texan , January 12, 2016 at 11:56 am

Thanks, your comments are accurate; and this is something that is too little discussed.

ilporcupine , January 12, 2016 at 5:49 pm

I have seen this stated here on many occasions, over the course of the OCare debate. While the law seems to give authorization to clawback, in my state it only seems to have been used for nursing home and other long term care. I can state from my experience, I was never queried about assets, and was qualified only on income. I just lost the person with whom I have shared my life for 30 years, and her assets, went to her daughter without any claim from the state. Hers was an expensive battle with cancer, and did rack up a pile of charges. ( In my state, Medicaid is paying a private insurer to cover Medicaid patients). I have been reading here for a long time, rarely posting, I tend to agree mostly with the view here, but this seems to be widely different between states. I have no issue with Yves or Lambert on this, they have done yeoman work trying to get to the bottom of these issues. Just felt I needed to weigh in for the sake of completeness. Yves and Lambert you have my email if you want to discuss my experience, it is all to fresh a wound to discuss in this public forum.

Rob Lewis , January 12, 2016 at 10:39 am

No argument that Obamacare has some serious problems. But placing ALL the blame on the President seems excessive. Even if he had come out strongly for single payer, there are more than enough DINOs in Congress in thrall to Health Care, Inc. to have prevented its passage. And the Republicans would have dialed up their anti-reform propaganda to new levels of hysteria (Remember the anti-Hillarycare saturation media campaign? I'll bet Obama does.)

sleepy , January 12, 2016 at 10:55 am

When Obama was inaugurated he had more political capital in his pocket than any president in recent memory. The repubs were on the ropes.

Sure, the repubs could have gone all out in opposition, but as another poster mentioned Obama could have gone all out as well and blitzed the country. And in the first few months of his presidency, my bet would have been on him more than on the repubs.

Of course he did nothing. And to say he did nothing because of fear of the repubs at that point is silly. He empowered the repubs. He didn't even pretend.

HotFlash , January 12, 2016 at 11:33 am

Even if he had come out strongly for single payer…

Oh, but he didn't! If pigs had wings, perhaps they could fly? He could have, he didn't even pretend (like he did with closing Gitmo). Oh, concerned about his legacy? No problem, $peaking fees from insurance companies, pharmacos, $eat on bds of directors, his future will be golden!

Hello. "Leaders", elected or otherwise, sell out locals to corps = banana republic.

Have a banana.

Lambert Strether Post author , January 12, 2016 at 11:48 am

"placing ALL the blame on the President"

Match for that straw?

fb , January 12, 2016 at 4:43 pm

"All health insurance plans purchased through Covered California must cover certain services called essential health benefits. These include doctor visits, hospital stays, emergency care, maternity care, pediatric care, prescriptions, medical tests and mental health care. Health insurance plans also must cover preventative care services like mammograms and colonoscopies. Health insurance companies cannot charge copayments, coinsurance or deductibles for such services."

Yves Smith , January 12, 2016 at 7:05 pm

By taking that out of context, you've considerably overstated what Covered California covers.

Just as in the rest of the US, the "metal levels" have the same meaning. For instance:

Bronze: On average, your health plan pays 60 percent of your medical expenses, and you pay 40 percent.

This is the language from their "Essential Health Benefits" section:

Essential Health Benefits

All health insurance plans now share some common characteristics. The Affordable Care Act requires that all health insurance plans offered in the individual and small-group markets must provide a comprehensive package of items and services, known as essential health benefits.

These benefits fit into the following 10 categories:

Ambulatory patient services.
Emergency services.
Hospitalization.
Maternity and newborn care.
Mental health and substance use disorder services, including behavioral health treatment.
Prescription drugs. For more information about prescription drug benefits, visit the page Prescription Drugs.
Rehabilitative and habilitative services and devices.
Laboratory services.
Preventive and wellness services and chronic disease management. For more information about preventive services with no cost sharing, click here.
Pediatric services, including dental and vision care. Dental insurance for children will be included in the price of all health plans purchased in the exchange for 2015.
The requirement for insurance plans to offer essential health benefits is just one of many changes in health coverage that began in 2014.

So this is just ACA boilerplate. I do recall reading that Covered CA does require some services be provided irrespective of the deductibles (beyond the ACA-mandated preventive care items like mammograms, which separately are a bad test), but after 10 minutes of poking around the Covered CA site and other Googling, I can't find any evidence of what those other services might be. I thought it was at least a doctor visit or two, but I can't even find that.

And 75% of Covered CA plans have narrow networks, compared to 41% for the US as a whole, which among other things means you might not be able to get a specialist you need:

http://touch.latimes.com/#section/-1/article/p2p-84275268/

The site and web service are also terrible, see the long horror stories at Yelp:

http://www.yelp.com/biz/covered-california-sacramento

And see this from Kaiser News:

Most Insurance Exchanges Just Got Bigger. Covered California Is Getting Smaller.

http://khn.org/news/california-healthline-fewer-insurers-on-online-marketplace/

RUKidding , January 12, 2016 at 11:52 am

Obama NEVER tried one iota to go for Single Payer. Nada, Zip, Nothing.

Ergo, I place ALL the blame on Obama. IF he had tried even a teeny tiny bit, I could perhaps place some blame elsewhere. But factual reality refutes that.

I also do recall the POTUS taking Dennis Kucinich up in Air Force One, and when they landed, suddenly Kucinich had changed his mind and was (reluctantly in my viewpoint) giving an thumbs up on ObamaCare. Kucinich was the longest hold out advocating for Single Payer. Obama basically took him to school and forced him in some way to STFU and say Obamacare was the best.

Baloney. Obama sold us all to BigInsurance, BigPharma, BigHospital, BigMedDevice, and I'm sure he was handsomely rewarded.

This one, imo, is all on Obama. It was what he wanted, and it's what he now touts as being this very great thing, which it's not.

so , January 12, 2016 at 12:38 pm

No amount of dem. or repb. BS will ever persuade me to participate in national politics again.
obamas handling of the ongoing financial and health care crisis finished it for me.
It's so clear to me where were at. The corruption is sickining. EVERY DAY the stories. I keep thinking…."all the kings horses and all the kings men couldn't put Humpty back together again." Read The Archdruid Report for some insight. Everybody wakes up sooner or later.
In this life or the next

tegnost , January 12, 2016 at 11:30 am

Yes, definitely better to give up without a fight. Have you noticed that in spite of what is essentially a media blackout Bernie is likely leading in the polls? As to your opening statement "No argument that Obamacare has some serious problems" you admit to ACA shortcomings, maybe you would like to offer up some of what you see as good aspects of the ACA? Further, "there are more than enough DINOs in Congress in thrall to Health Care, Inc. to have prevented its passage. " there was and is a DINO in the oval office "in thrall to Health Care, Inc." who made no other option impossible. So much for the vaunted "free market" The ACA was designed and implemented as socialism for the 20% (h/t Lambert and others who have noted the upper class and their minions occupy the top quintile) whose medical care was getting too expensive, and whose medical (device, pharma patents, and insurance co.) investments were not being supported by demand, so the ACA created demand for them. Medicare for all, and get rid of the clawbacks, I personally would rather chromex's heirs get his assets rather than Blackstone, thank you.

tegnost , January 12, 2016 at 11:39 am

I notice that Crude Earl is tempting $30 and copper is at $1.96/lb, looks like some demand problems there, as well. Maybe we should mandate that everyone must purchase gasoline even if they don't have a car, and mandate that pennies will once again be made of copper? ka-ching!

Ulysses , January 12, 2016 at 3:25 pm

You jest, but in many late medieval and early modern Italian city-states there were ruthlessly enforced minimum consumption levels for salt. Prior to refrigeration salt was more of a food preservation necessity, but the huge consumption taxes placed on salt made them a fiscal necessity as well. Our word salary derives from the fact that so many government officials were paid from the revenues collected through salt taxes.

The much-hated gabelle in pre-Revolutionary France was a salt tax!

http://www.academia.edu/18012323/_Un_popolo_che_non_vorrebbe_sentire_nominare_dazi_esenzioni_privilegi_e_traffici_illeciti_tra_Brescia_Cremona_e_Mantova_nel_Settecento_versione_provvisoria_

Lord Koos , January 12, 2016 at 3:53 pm

No, a better solution would be forcing everyone to go in debt to own a large SUV… hybrids don't qualify.

tegnost , January 12, 2016 at 11:45 am

this was meant as a reply to rob lewis' post at 10:39

Rob Lewis , January 12, 2016 at 2:03 pm

I doubt you're really interested in a discussion, but here are a few very good things about Obamacare:
1. Elimination of pre-existing conditions as a reason for being refused coverage
2. Requirement that insurers spend at least 80% of their revenue actually paying benefits
3. Preventive care must be free
4. Expansion of Medicaid (where permitted by states) brings coverage to millions of previously uninsured
5. Standardization of plans makes is possible (if not easy) to compare them

And this is my opinion, but I don't think it would have been possible to get Medicare for All through Congress, even with Democrats nominally in control, for the reasons already stated.

Anyway, my whole point is that Obama doesn't deserve ALL the blame. Are you arguing that the public and Congress were ready and willing to enact single-payer, and Obama somehow prevented it?

Katiebird , January 12, 2016 at 3:44 pm

1. Pre-existing condition with the caveat that you must live in an area served by a medical establishment that specializes in your possibly rare illness.

2. 80% Yay! It's almost like Christmas! …. Cold comfort to those who must cough up $10,000 or more before getting any benefit from trom their policy at all.

3. Preventative care must be free. OK. So the $10,000 get's them a colonoscopy and a glucose meter.

4. Expanded Medicaid … In the states where it happened, anyone over 55 years old subject to an undisclosed clawback of benefits from estates. Wow.

5. I cannot imagine how you come up with the comparison justification. People have to sign up for plans without final commitments of which doctors or hospitals are included. And even then they are subject to change!

"Democrats nominally in control" … This is a pure deception. They had overwhelming majorities and wildly popular President. Do you seriously think that if faced with Obama's shaking finger and an enticing promise, that any Democrat would have defied him during those first 100 days. I laugh at the thought. He could ave gotten Expanded Medicare for All passed in those first 100 days with one hand tied behind his back.

bob , January 12, 2016 at 3:46 pm

Are you arguing that any single one of your bullet points is true?

For instance #1- covered? Covered by what? You can be covered and still not be able to afford the deductibles, or even the premiums.

The rest is talking point BS, tiny little grain of some sort of truth wrapped in ponies.

tegnost , January 12, 2016 at 9:55 pm

Thanks for responding. Yes it's good that pre-existing conditions no longer can be refused coverage,but one still needs to be able to afford coverage, so not being refused is not the same as receiving care, no? Your second point also has some merit as it appears intended to contain profiteering, but as one can see from martin shrkeli there's nothing stopping the greater healthcare marketplace from increasing costs, so the 80% becomes ambiguously beneficial. I did not know preventative care is free, but if that means as implied by another comment colonoscopies and other rather invasive procedures that might be seen as a cash cow with once again ambiguous benefits to consumers, really they are actually insureds, not consumers, as the prices are beyond peoples ability to pay, only insurers can ably do that, so the consumer is consuming insurance not care, I'm arguing for a gov't insurance and appreciate your opinion that it couldn't have been pulled off, as I think you are aware that my opinion is that they not only didn't try, indeed the executive branch stood between private sector healthcare industries and reform in the same way it stood between the banksters and those pitchfork wielding crazy people. Whatever your feelings about all that saving the economy stuff, it was largely and in many aspects a giveaway to people who were on the brink of disaster, a little more give and take would have been appropriate and the hope and change mandate provided the executive with considerable clout. Also, the medicaid expansion is a wolf in sheep's clothing as the clawback is regressive and punishes low income people as well as some probably good sized portion of people who will find themselves unceremoniously dumped into medicaid when their insurance and other medical bills drive them into financial distress. Lastly, the standardization of plans was in fact useful for me to figure out i couldn't afford it without taking to much time. I'll dilute my criticism of the president to be more inclusively the executive branch and their collective agenda, but basically the O man is the CEO so gets to be the hero, or the goat…

Adrienne Adams , January 12, 2016 at 11:35 am

As Chromex notes, Obamacare "coverage" is high-deductible catastrophic, so all day-to-day "care" is paid for out of pocket. But just try finding out how much a procedure costs… I needed an MRI on my knee, and it took three phone calls to find out how much I would be paying for the procedure. First you need to know the exact billing code for the procedure, which means you need to find the person in the doctor's office who is anointed in the mystical realm of billing codes; then you need to call the insurance company customer service rep, who is initially mystified that you are actually trying to find out how much something costs; then you (hopefully) transferred to someone in the billing department (who has never spoken to an actual patient before); and finally, if you are lucky, in two or three weeks you will revive a letter from another anointed person giving the actual out of pocket cost of the procedure-which will probably be different after the fact as "adjustments" are made between provider and insurer.

If we had to buy anything else in this fashion, we'd all be naked, starving, and out-of-doors.

craazyboy , January 12, 2016 at 11:50 am

It's a market.

nowhere , January 12, 2016 at 2:06 pm

Did you misspell racket?

ProNewerDeal , January 12, 2016 at 1:34 pm

I recall seeing a stat that the median adult net worth of USians was only US$37K, whereas in Canada it is US$80K. I wondered if the primary reason for the huge difference, is the presence of Canada-style MedicareForAll in Canada. It appears the US health system bankrupts you rapidly as in literal medical bankruptcy as per indivduals' examples in the "Sicko" documentary"' or bankrupts you slowly, as in these crapified ACA policies that charge ~$12K/yr before paying for anything besides the annual physical exam even within your "narrow network".

Yves, are you aware of any economist study which estimates the differential in financial net worth between barbaric USA & civilized Canada?

sleepy , January 12, 2016 at 3:16 pm

Apparently what the masters of Canada can't extract through healthcare debt, they do it through astronomically high real estate prices, exceeding our bubble high of 2007. Though there are signs of deflation, tiny 2 bedroom bungalows in Winnipeg–depressed Canadian flyover country–go for $300K. The same dump in Minneapolis is yours for $175K. And that's comparing economically challenged Winnipeg with relatively prosperous Minneapolis.

Yes, not paying $1200/month in health insurance premiums can go to that overpriced Canadian mortgage, but that's sort of my point.

And to ward off some comments–I am in no way stating that Canada's national health program causes high housing costs.

Crazy Horse , January 12, 2016 at 4:40 pm

And the median net worth in Australia and Italy, among other countries is well over 100k. Makes you wonder about American Exceptionalism.

ProNewerDeal , January 12, 2016 at 11:24 pm

America is exceptionally wack & Crapified (c) Yves, as far as life for the 99%ers probably in the lowest quintile within the OECD, even when including the don't-really-belong members like Mexico & Turkey. Meanwhile Murica, from everyday people to the elites, drink Murican Exceptionalist Kool-aid on how Murica is Always The Best, no need to ever learn from any other nations on anything.

ProNewerDeal , January 12, 2016 at 1:46 pm

I wonder if the "net present value" of money/time/stress cost of emigrating to a civilized nation like Canada for those USians fortunate enough to have a chance of doing so, is likely to be much less than the equivalent money/time/stress cost of living an entire life in the US & having to deal with the US Sickcare Mafia.

hemeantwell , January 12, 2016 at 3:03 pm

Lambert said:

I've found that when I talk to people about health care and health insurance; they're very defensive and proprietary about whatever random solution they've been able to cobble together

In my limited conversations I've noticed that, too. I've been left wondering if it is hard to for them to give a clear answer since they've had to engage in guessy speculation about what they, and their families, might come down with, and they end up having to imagine awful stuff and then discount the possibility of it occurring, so too bad for little Susie if awful occurs. Trudy Lieberman has given emphasis to the absurdity of asking people to bet on their health, and I'm guessing it's not just a matter of feeling embarrassed about weak actuarial skills.

Shilo , January 12, 2016 at 6:46 pm

Talking about how you coped with Obamacare gives a clear insight into your personal finances, something a lot of people are hesitant to discuss.

When I was young I was taught never to ask a rancher how many head of cattle he ran, because it's no different that saying, "Hey, How much money are you worth?"

jonf , January 12, 2016 at 4:21 pm

So where do we go from here? Help the republicans repeal it? Fix it? Frankly I don't know. We don't have a congress to fix or replace it -even if Sanders wins. I think it helps some people, mostly those on Medicaid. So repealing it doesn't make sense unless it can be replaced. Even saying this is a marketplace is an outright lie. These bastards are just stealing from us all. Rock and a hard place. Sanders is the only hope and that at times seems vanishingly small.

nihil obstet , January 12, 2016 at 5:16 pm

When Obama took office, The United States National Health Care Act, HR 676 , for a single-payer system of expanded Medicare for All, was in the House of Representatives. If I remember correctly, it had over 100 Democratic Congresspeople co-sponsoring it. Part of the Obama administration's efforts on its own health insurance bill were aimed at getting the bill withdrawn.

afreeman , January 12, 2016 at 8:31 pm

Thanks for that reminder. Reading the recent book, American President (from Teddy to Bill) helps one's recall considerably-telling contrasts between Presidents who knew how to pass legislation and the flukes (if assassination can be called a fluke, i.e. Devil's Chessboard) that brought them our way against those who didn't. For instance, LBJ compared with JFK, who had enough legislative service to learn a thing or two if he were interested, that is.

Too bad the book's so damn thick-well written and lively though it may be. Voters not likely to read it. Should though.

Malcolm MacLeod, MD , January 12, 2016 at 9:21 pm

Lots of arguing and different thoughts, but one primary fact remains. Obama was a bald-faced
lier from the get-go, and has remained true to that principle. He hasn't really tried hard to
question that. The amount of damage done to this nation during his tenure amounts to that
amount perpetrated by a traitor. Just being bad was "W"; this is actually far worse.

Malcolm MacLeod, MD , January 12, 2016 at 9:34 pm

Lots of arguing and different thoughts, but one primary fact persists. Obama has been a
bald-faced liar from the get-go, and has remained true to that principle. He really hasn't
tried hard to dispute that. The amount of damage done to this nation during his tenure
amounts to that amount perpetrated by a traitor. "W" was just bad; This is far worse.

ewmayer , January 12, 2016 at 9:41 pm

Related: Kentucky governor to dismantle state's health insurance exchange: newspaper | Reuters

Now, Kentucky being Kentucky, the motives here may be such that it is difficult for critics of the ACA to claim as any kind of 'win' – would any of our Kentuckian readers care to comment?

[Jan 12, 2016] Deep State controls that county. Voting Is for Chumps

Notable quotes:
"... One of the more encouraging (?) developments in Acceptable American Discourse over the last five years or so has been the gradual acceptance, even among Serious Media Outlets, that American voters no longer have any real control over their own government, and more broadly, their collective destiny. ..."
"... In April 2014, Princeton University published a study which found that economic elites and organised groups representing business interests have substantial independent impacts on US government policy, while average citizens and mass-based interest groups have little or no independent influence. ..."
"... Theres the one we elect, and then theres the one behind it, steering huge swaths of policy almost unchecked. Elected officials end up serving as mere cover for the real decisions made by the bureaucracy. ..."
"... Weve become now an oligarchy instead of a democracy. And I think thats been the worst damage to the basic moral and ethical standards of the American political system that Ive ever seen in my life, the 90-year-old former president told Winfrey. ..."
"... And given the fact that people would rather know about Kim Kardashian than what makes up the budget or what the government is doing in Mali or Sudan or other unknown places, this is what you get: a disconnected, self-serving bureaucracy that is … simply evolving to do what its doing now. That is, to maintain and enhance its own power. ..."
"... The key institutions are exactly what people would think they are. The military-industrial complex; the Pentagon and all their contractors (but also, now, our entire homeland security apparatus); the Department of Treasury; the Justice Department; certain courts, like the southern district of Manhattan, and the eastern district of Virginia; the FISA courts. ..."
"... It is a complex mechanism, a take-over of key positions within the US power structure, a corporate government mix where the US government mission is to advocate, promote, and defend corporate interests worldwide. ..."
"... US National Security Strategy embodies those corporate interests and unfolds them into specific goals and objectives to be attained by means of foreign and domestic policies that presidents and other figureheads sell at home and abroad. ..."
"... @15 This is excuse making for falling for Obama who openly admired Reagan, claimed the right to bomb anything anywhere without working with local governments, surrounded himself with pigs, and even denounced Moveon for their ad about Petraeus. ..."
"... The system is totally corrupt. If you make it to Congress, youve got favors to pay back. If you dont work for the corporate interests (already aligned with deep state) you wont get the money to run a second term. Some other craven asshole will take your job whether you want it (by demonstrating total acquiescence) or not (by trying to be Mr.Smith in Washington). ..."
"... The very best thing about Donald Trump, is that he is an outsider - particularly when compared with the other contestants whom are machine politicians (corrupted in the system). BTW, Bernie is full of shit (as is Trump). ..."
"... Jimmy Carter seems like a real nice fellow. It should be remembered, however, that Brzezinski was Carters National Security Adviser. Now that was probably the deep state hanging that albatross around ol Peanut Boys neck (as a minder, perhaps). In any case, Carter didnt do anything to stop that son of a bitch from his evil doings in Afghanistan. ..."
"... You are soldiers of god. Your cause is right and god is on your side . - Brzezinski addressing the Mujahideen. ..."
"... Jane Mayers new book says Koch Brothers father built a major oil refinery for Hilter ..."
"... Ms. Mayer, a staff writer at The New Yorker, presents the Kochs and other families as the hidden and self-interested hands behind the rise and growth of the modern conservative movement. Philanthropists and political donors who poured hundreds of millions of dollars into think tanks, political organizations and scholarships, they helped win acceptance for anti-government and anti-tax policies that would protect their businesses and personal fortunes, she writes, all under the guise of promoting the public interest. ..."
"... The Kochs, the Scaifes, the Bradleys and the DeVos family of Michigan were among a small, rarefied group of hugely wealthy, archconservative families that for decades poured money, often with little public disclosure, into influencing how the Americans thought and voted, the book says. ..."
"... You cant run a campaign to be elected President of the United States unless you can tap into billionaires who are willing to hand over $100 millions to your campaign. ..."
"... This is part of the reason why Trump is causing so much mayhem: he is a candidate who already has those $billions, and so he isnt beholden to anyone but himself and his own whacky ideas. ..."
"... Deep down I suspect that this is why he is the Republican frontrunner i.e. deep down Mr Joe Average knows that his democracy has been hijacked out from underneath him, so he is receptive to Trumps dogwhistle. ..."
"... The DS vetted Ike and discovered that he looked up to corporate CEOs and Wall Street financiers and their lawyers, he was sympathetic to those he fantasized as captains of industry and looked upon success as a marker of steady men, those of his imagined deep state. ..."
"... Ike bought the Whats good for GM is good for the country line, just as Engine Charley Wilson did. No need to assassinate Ike. ..."
www.moonofalabama.org

Lone Wolf | Jan 11, 2016 3:56:12 PM | 9

For all of those who keep on arguing about the benefits of one US candidate over the other, they could save their energy for more constructive efforts.

Voting Is for Chumps: Veteran Congressional Staffer Says 'Deep State' Already Controls America

You still have to pay your taxes, though

One of the more encouraging (?) developments in Acceptable American Discourse over the last five years or so has been the gradual acceptance, even among Serious Media Outlets, that American voters no longer have any real control over their own government, and more broadly, their collective destiny.

In April 2014, Princeton University published a study which found that "economic elites and organised groups representing business interests have substantial independent impacts on US government policy, while average citizens and mass-based interest groups have little or no independent influence."

Then in October of the same year, a Tufts University professor published a devastating critique of the current state of American democracy, "National Security and Double Government," which catalogs the ways that the defense and national security apparatus is effectively self-governing, with virtually no accountability, transparency, or checks and balances of any kind. He uses the term "double government": There's the one we elect, and then there's the one behind it, steering huge swaths of policy almost unchecked. Elected officials end up serving as mere cover for the real decisions made by the bureaucracy.

The Boston Globe's write-up of the book was accompanied by the brutal headline, "Vote all you want. The secret government won't change." Imagine a headline like that during the Hope and Change craze of 2008. Yeah, you can't. Because nobody's that imaginative.

Yes, people are beginning to smell the rot - even people who watch television in hopes of not having to confront the miserable reality that awaits them once they turn off their 36-inch flatscreens. In September, Jimmy Carter warned Oprah Winfrey:

"We've become now an oligarchy instead of a democracy. And I think that's been the worst damage to the basic moral and ethical standards of the American political system that I've ever seen in my life," the 90-year-old former president told Winfrey.

The live audience were probably hoping for free Oprah cars. Instead, an ex-president told them that their democracy is in the gutter. What a bummer.

The latest canary in the coal mine is none other than ex-longtime GOP staffer turned best-selling author Mike Lofgren, whose new book, "The Deep State: The Fall of the Constitution and the Rise of a Shadow Government," confirms what is already painfully apparent:

The deep state has created so many contradictions in this country. You have this enormous disparity of rich and poor; and you have this perpetual war, even though we're braying about freedom. We have a surveillance state, and we talk about freedom. We have internal contradictions. Who knows what this will fly into? It may collapse like the Soviet Union; or it might go into fascism with a populist camouflage.

Some excerpts from Salon's recent interview with Lofgren:

On how the deep state operates:

Well, first of all, it is not a conspiracy. It is something that operates in broad daylight. It is not a conspiratorial cabal. These are simply people who have evolved [into] a kind of position. It is in their best interest to act in this way.

And given the fact that people would rather know about Kim Kardashian than what makes up the budget or what the government is doing in Mali or Sudan or other unknown places, this is what you get: a disconnected, self-serving bureaucracy that is … simply evolving to do what it's doing now. That is, to maintain and enhance its own power.

On who (and what) is part of the deep state:

The key institutions are exactly what people would think they are. The military-industrial complex; the Pentagon and all their contractors (but also, now, our entire homeland security apparatus); the Department of Treasury; the Justice Department; certain courts, like the southern district of Manhattan, and the eastern district of Virginia; the FISA courts. And you got this kind of rump Congress that consists of certain people in the leadership, defense and intelligence committees who kind of know what's going on. The rest of Congress doesn't really know or care; they're too busy looking about the next election.

Lofgren goes on to explain that the private sector works hand-in-hand with the deep state, regardless of which "party" is in power. According to Lofgren, "There are definable differences between Bush and Obama. However, the differences are so constrained. They're not between the 40-yard lines; they are between the 48-yard lines."

Of course, millions of Americans will still enjoy rooting for the candidate whom they would most enjoy drinking Bud Lite Lime with, but probably deep in their hearts they all know they're doomed.

The End.

lysias | Jan 11, 2016 4:05:02 PM | 10

What is the mechanism that forces American presidents to go along with what the deep state decides?

john | Jan 11, 2016 4:31:03 PM | 12

What is the mechanism that forces American presidents to go along with what the deep state decides?

well, there's always this

Zapruder Film Slow Motion (HIGHER QUALITY) - YouTube

lysias | Jan 11, 2016 4:41:29 PM | 14

@12, Only a coward would submit to such a threat, instead of regarding it as a challenge to be defied. If the worst came to the worst, one would at least have died heroically. And such a president, if he did die, could have taken steps before he died to make sure the public would learn how and why he died. So it would not be a death without purpose.

How does the deep state ensure that only cowards become president?

Lozion | Jan 11, 2016 4:58:21 PM | 15

@10 Blackmail?
Don't know if true but I remember reading something to the effect that after Obama was sworn in, he met with Bush sr. and co who told him that he now worked for them with threats to his family if he wouldn't submit..

Lone Wolf | Jan 11, 2016 5:22:54 PM | 17

@lysias@10

What is the mechanism that forces American presidents to go along with what the deep state decides?

It is a complex mechanism, a take-over of key positions within the US power structure, a corporate government mix where the US "government" mission is to advocate, promote, and defend corporate interests worldwide.

US National Security Strategy embodies those corporate interests and unfolds them into specific goals and objectives to be attained by means of foreign and domestic policies that "presidents" and other figureheads sell at home and abroad.

That, in a nutshell, is how the Deep State works.

Bluemot5 | Jan 11, 2016 5:23:42 PM | 18

What is the mechanism that forces American presidents to go along with what the deep state decides?
...and then there is this... https://www.corbettreport.com/interview-1024-tjeerd-andringa-exposes-the-kakistocracy/

NotTimothyGeithner | Jan 11, 2016 5:45:15 PM | 23

@15 This is excuse making for falling for Obama who openly admired Reagan, claimed the right to bomb anything anywhere without working with local governments, surrounded himself with pigs, and even denounced Moveon for their ad about Petraeus.

People hate being conned more than con men, and they concoct rationalizations for being duped that often defy logic.

jo6pac | Jan 11, 2016 6:22:07 PM | 25

For everyone on deep state there is this.

http://www.nakedcapitalism.com/2011/09/guest-post-obama-team-feared-revolt-if-he-prosecuted-war-crimes.html

#21 yep maybe the next pm for England. The candidate like obomber from the cia/m16.

#11 I Agree

jfl | Jan 11, 2016 7:00:06 PM | 28

@10 'What is the mechanism that forces American presidents to go along with what the deep state decides?'

1. DS vets prospective candidates beforehand, only allowing candidates aligned with deep state authorities to begin with.
2. DS doesn't make the payoff until successful applicants have left office with an 'acceptable' record.
3. Assassination is always an option in extreme cases, real or imagined.

....

fast freddy | Jan 11, 2016 7:46:05 PM | 33

The system is totally corrupt. If you make it to Congress, you've got favors to pay back. If you don't work for the corporate interests (already aligned with deep state) you won't get the money to run a second term. Some other craven asshole will take your job whether you want it (by demonstrating total acquiescence) or not (by trying to be Mr.Smith in Washington).

Now, if you want to be President, you've got to have "experience" in Congress or in state gubmint.

The very best thing about Donald Trump, is that he is an outsider - particularly when compared with the other contestants whom are machine politicians (corrupted in the system). BTW, Bernie is full of shit (as is Trump).

juliania | Jan 11, 2016 8:50:00 PM | 37

Lone Wolf @ 9

That is a very good explanation of 'Deep State'. My only caveat is that it doesn't completely describe the oligarchy because it leaves out the corporate component. When money became speech a huge mountain of power devolved to the rich. They'd always had clout as the graphs describing the separation of the rich from the not-so-well off and the rest of us have made clear - but now the ugly truth is unavoidable and it all goes together to produce what President Carter described.

It's just plain awful.

ben | Jan 11, 2016 10:04:10 PM | 42

An excellent site with a deep look at the deep state: http://www.unwelcomeguests.net/UNWELCOME_GUESTS

V. Arnold | Jan 11, 2016 9:57:24 PM | 41

Lone Wolf @ 9 & 17: Yep, that about covers it. Thanks.

Stir this into the mix, and basically, America's system of governance is a fraud.

http://therealnews.com/t2/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=14545

fast freddy | Jan 11, 2016 10:05:02 PM | 43

Jimmy Carter seems like a real nice fellow. It should be remembered, however, that Brzezinski was Carter's National Security Adviser. Now that was probably the deep state hanging that albatross around ol' Peanut Boy's neck (as a minder, perhaps). In any case, Carter didn't do anything to stop that son of a bitch from his evil doings in Afghanistan.

"You are soldiers of god. Your cause is right and god is on your side". - Brzezinski addressing the Mujahideen.

https://www.youtube.com/watch?v=A9RCFZnWGE0

Susan Sunflowe r | Jan 11, 2016 10:54:55 PM | 49

Jane Mayers new book says Koch Brothers father built a major oil refinery for Hilter ... It looks to be another corker ...

Ms. Mayer, a staff writer at The New Yorker, presents the Kochs and other families as the hidden and self-interested hands behind the rise and growth of the modern conservative movement. Philanthropists and political donors who poured hundreds of millions of dollars into think tanks, political organizations and scholarships, they helped win acceptance for anti-government and anti-tax policies that would protect their businesses and personal fortunes, she writes, all under the guise of promoting the public interest.

The Kochs, the Scaifes, the Bradleys and the DeVos family of Michigan "were among a small, rarefied group of hugely wealthy, archconservative families that for decades poured money, often with little public disclosure, into influencing how the Americans thought and voted," the book says.

Many of the families owned businesses that clashed with environmental or workplace regulators, come under federal or state investigation, or waged battles over their tax bills with the Internal Revenue Service, Ms. Mayer reports. The Kochs' vast political network, a major force in Republican politics today, was "originally designed as a means of off-loading the costs of the Koch Industries environmental and regulatory fights onto others" by persuading other rich business owners to contribute to Koch-controlled political groups, Ms. Mayer writes, citing an associate of the two brothers.

NYT: Father of Koch Brothers Helped Build Nazi Oil Refinery, Book Says .

... ... ...

Yeah, Right | Jan 12, 2016 3:13:58 AM | 63

@10 "What is the mechanism that forces American presidents to go along with what the deep state decides?"

Money.

You can't run a campaign to be elected President of the United States unless you can tap into billionaires who are willing to hand over $100 millions to your campaign.

Without that largess you are not going to get elected, and people who have $billions are the going to be the very same people who make up the Deep State.

So you either get with the program or you get.... nothing. Not a cent. Not a hope.

This is part of the reason why Trump is causing so much mayhem: he is a candidate who already has those $billions, and so he isn't beholden to anyone but himself and his own whacky ideas.

Deep down I suspect that this is why he is the Republican frontrunner i.e. deep down Mr Joe Average knows that his "democracy" has been hijacked out from underneath him, so he is receptive to Trump's dogwhistle.

Which, basically, is this: why are you bothering with any of these chattering monkeys? Their votes will end up belonging to people like me anyway, so you may as well just cut out the middle-man.

jfl | Jan 12, 2016 3:30:05 AM | 64

Great story chipnik ... you should continue in that vein more often.

lysias @10 ... from guest77s recommended read ... @55 in the previous open thread ...

The Devil's Chessboard. Allen Dulles, the CIA, and the Rise of America's Secret Government , chapter 10

Eisenhower's innate midwestern sense of decency initially made him recoil from backing Britain's colonial siege of Iran. He rebuffed the Dulles brothers' advice, suggesting that it might be a better idea to stabilize Mossadegh's government with a $100 million loan than to topple it. If Eisenhower had followed through on his original instincts, the bedeviled history of U.S.-Iran relations would undoubtedly have taken a far different course.

Realizing that Eisenhower was not inclined to defend British imperial interests, the Dulles brothers reframed their argument for intervention in Cold War terms. On March 4, 1953, Allen appeared at a National Security Council meeting in the White House armed with seven pages of alarming talking points. Iran was confronted with "a maturing revolutionary set-up," he warned, and if the country fell into Communist hands, 60 percent of the free world's oil would be controlled by Moscow. Oil and gasoline would have to be rationed at home, and U.S. military operations would have to be curtailed.

In truth, the global crisis over Iran was not a Cold War conflict but a struggle "between imperialism and nationalism, between First and Third Worlds, between North and South, between developed industrial economies and underdeveloped countries dependent on exporting raw materials," in the words of Ervand Abrahamian.

The author pours it on thick with zero references but, overall ...

1. The DS vetted Ike and discovered that he looked up to corporate CEOs and Wall Street financiers and their lawyers, he was sympathetic to those he fantasized as captains of industry and looked upon success as a marker of steady men, those of his imagined deep state.

2. Ike came cheap. He felt it was his duty to help out if the people he looked up to thought he was the right man at the right time.

3. Ike bought the 'What's good for GM is good for the country' line, just as Engine Charley Wilson did. No need to assassinate Ike.

The DS uses the same M.O. ... O tempora, o mores ... mutatis mutandis.

[Jan 12, 2016] M of A - The Saudi War On Everything Iran May Bounce Back As New Houthi Missile

Notable quotes:
"... The world is awash in blood because two sociopathic brothers (Dulles Brothers) took over US foreign policy and eventually killed a President. ..."
"... There is reasonable possibility that the decision by the Saudi dictatorship to execute the high profile Shiite Sheikh Nimr may have been motivated, at least in part, by the desire to deflect the probability of retribution by the Shiite-hating Islamic State since the majority of the 47 executed along with Nimr were comprised of violent, hard-core Sunni devotees of ISIS. ..."
"... No political system is exempt from corruption and in my opinion this outcome might even be somehow inexorable due to the nature of a state based polity. ..."
"... there is a conflict at the top in saudi arabia and only a matter of time where one or the other goes? it seems that since Mohammad bin Salman Al Saud was given the position of 2nd in command in sa (and minister of defense responsibility), a lot of shite has hit the fan... this began with the war on yemen in march 26 2015 and continues on in everything else ..."
"... Let our position be absolutely clear: An attempt by any outside force to gain control of the Persian Gulf region will be regarded as an assault on the vital interests of the United States of America, and such an assault will be repelled by any means necessary, including military force ..."
www.moonofalabama.org
The BS nuclear deal between US and Iran was to get Iran to massively reduce its nuclear capabilities, which except for a war which the US is no way near ready for, So sophisticated subversion and sanction pressure was used instead.
And those corporations wanting access to Iran now what access to extract from Iran, not contribute to it's economy.

All the huffing and puffing by the Israeli state terrorists and Saudi tyranny about that deal, simply betrays their brutal idiotic methods, compared to more sophisticated methods to the US empire is capable of.

And The US already set up the war showdown between Iran and Saudi Arabia, with its divide and conquer policy, and its massive sales of weapons to the Saudi tyranny. That war is just A matter of time. It's proxies first and then it's full scale engagement between those two states.

tom | Jan 4, 2016 2:22:50 PM | 2
Unless you know something and are not sharing this article is speculation. Arming the Houthi's would, in my opinion, be about as intelligent as was arming the Taliban in the 1980's. The armed Houthi's may take care of the Saudi's (just like the Taliban took care of the Russians in that case) but then who would take care of the Houthi's? and what other havoc would they cause? Different players here but the tactic would be similar and have the same potential of backfiring in the long run.
Khalid Shah | Jan 4, 2016 2:24:45 PM | 3
B, from what you are saying your 'smart move by KSA' is looking more and more like another dumb move by KSA... If the Saudis had executed just 'al-Qaeda types' and put out a press release showing how they are cracking down on terrorism the kingdom would be attracting support from their allies right now--"Those Saudis are brutal but at least they know how to get the job done." Of course, it's unclear how much right wing/Islamic State backlash they might have gotten domestically but I suspect it would have been minimal as long as the unofficial KSA paychecks to the terrorists kept coming.
WorldBLee | Jan 4, 2016 2:28:11 PM | 4
There is another reason why Saudi Arabia created a crisis just after the killing of Alloush.

Saudi Arabia has failed to set a serious Syrian opposition group. It has just lost its strongest ally, Alloush, the leader of the militias it has been supporting for years. It now worries that the other side, the Syrian government will win an overwhelming diplomatic victory if the planned meeting in Geneva takes place. Therefore it is doing all it can to prevent that meeting to happen. The execution of Sheikh Nimr and the subsequent rupture of the diplomatic relation with Iran is the first move. More of these desperate gesticulation are necessary. But as they'll fail to change much of Iran and Russia's determination to move on on Syria, it will only confirm to the whole world that it is not Bashar al Assad and his government that are weak, isolated and on the defensive, but rather Saudi Arabia and its inept and amateurish leadership.

virgile | Jan 4, 2016 4:09:26 PM | 12
#12 -- ""Saudi Arabia has failed to set a serious Syrian opposition group. It has just lost its strongest ally, Alloush, the leader of the militias it has been supporting for years. ""

good, excellent point ... this execution could simply have been payback ... and/or "dog ate my homework" excuse providing for why they're going to, say, no-show in Vienna ...

Susan Sunflower | Jan 4, 2016 4:17:10 PM | 14
It could be that the killing of Sheikh Nimr is to the Saudis what the shooting of the Russian plane has been to the Turks: a provocative blunder with unexpected consequences.
The two Sunni leaders, Erdogan and King Salman are very close to loose the 4 years old game of toppling Bashar al Assad. In these desperate moves, are they hoping to reshuffle the cards by provoking Syria's allies?
virgile | Jan 4, 2016 4:28:01 PM | 18
Andoheb,

They are Quahir1 missiles. While the Yemeni Forces claim they are upgraded , obsolete Soviet ballistic missiles, re-engineered in Yemen,

Visual identification suggests that they are ancient, obsolete SAM-3 antiaircraft missiles, ( which the Yemen Army had thousands), with a new warhead and a guidance system conversion to make them ballistic missiles.

To date, Iran has supplied nothing to the Ansrallah Movement, other than kind words,.....

And a single shipment of Humanitarian aid to Yemeni NGO's.

Brunswick | Jan 4, 2016 4:57:38 PM | 23
Sunni Islam is actually more democratic than Shia Islam. The Wahabist strain is just such a huge departure from traditional Sunni values. I wish I saved all my conversations with a Muslim friend about these issues. We boiled it down to making a comparison that Christians can understand. Sunni Islam is similar to Protestantism is that it is highly decentralized. Anyone that reaches that status of Iman (Minister) can issue a religious ruling (fatwa). Shia are similar to Catholics. The Grand Ayatollahs are bishops but in the Iranian government the Grand Ayatollah is the Pope.

The Wahabist are....I do not know how to properly describe them.

Sunni have a natural inclination to a democratic government (I'm not saying that Shia do not, 1954...). Western Imperialism has prevented every moderate attempt. The only place left for Muslims to organize is in radical religious groups. All other modes of reform have been destroyed. We are all witnessing the children of the Dulles era CIA. The world is awash in blood because two sociopathic brother's (Dulles Brothers) took over US foreign policy and eventually killed a President.

AnEducatedFool | Jan 4, 2016 5:11:46 PM | 24
I still find it very interesting that everyone seems to think that these "smart, stupid" whatever you want to call them are actually KSA independent choices

Lol they are flying the worlds most expensive toys in Yemen and getting their asses handed to them. Trust me when i tell you this. Saudis and Emirate Arabs in general are nothing but Bedouin desert dwellers or as the line from titanic goes "new money"

If people are too blind to see the British/US/Israeli hands in this then go ahead and keep debating about the smoke screen or the true colour of wool being pulled over your eyes.

Saudis and Bahrain are not independent states. They are military bases for the US against Iran, Rusia, China grabbing control of the rest of the middle east.

Executing "rabble rousing" Nimr , will in turn be the downfall of KSA and all these "Analysts" think tanks and what not will finally realize that the ME is not what it always seems

Deebo | Jan 4, 2016 5:33:05 PM | 29
Iraq Says Mosque Bombings Were False Flag ISIS Attacks
"An Iraqi official blamed the Islamic State group on Monday for the bombing of two Sunni mosques in a predominantly Shiite city in southern Iraq the previous night, saying the militant group seeks to stoke sectarian tensions," AP reports. ISIS "did this to inflame sectarian strife in the country," provincial security official Falah al-Khafaji contends.

ZeroHedge speculates:

Taking it a step further, one has to wonder whether there's a larger plan here. That is, if we assume ISIS, like the multitude of other Sunni extremist groups operating in the region, is taking its cues from handlers and benefactors, it's not difficult to imagine that "someone" could be attempting to create an excuse for an intervention in Iraq.
Jackrabbit | Jan 4, 2016 6:07:47 PM | 33
Save that date -- the next installment of Syrian peace negotiations:
"[Staffan] De Mistura is due to launch peace talks between Assad's government and the opposition in Geneva on January 25, but it remained unclear whether the Iran-Saudi crisis would have an impact on that plan.

De Mistura has flown to Ryadh and is due to then visit Tehran ... Yeah, I can't see these two parties sharing a table ....

""UN Secretary-General Ban Ki-moon said he was "deeply dismayed" by the Saudi execution of 47 people including prominent Shiite cleric Nimr al-Nimr, who has been critical of the Sunni royal family and was a driving force behind anti-government protests in 2011. snip

In his talks with Saudi Foreign Minister Adel Jubeir, Ban urged Saudi Arabia "to renew its commitment to a ceasefire" in Yemen after the Riyadh-led coalition announced on Sunday that it was ending the truce with Iran-backed rebels in the country.[yemen]

The U.N. envoy for Yemen, Ismail Ould Cheikh Ahmed, was to hold talks in Riyadh on Wednesday to push for a renewed ceasefire.

Alaraiya.net

It was a brilliant move in an effort to hit "re-set back to nil" at a moment when "progress" might appear on the far horizon.

Susan Sunflower | Jan 4, 2016 7:10:48 PM | 34
@12 virgile '... it is not Bashar al Assad and his government that are weak, isolated and on the defensive, but rather Saudi Arabia and its inept and amateurish leadership.'

Yes. Solid observation. How come their best friends in USrael didn't warn them of that particular aspect of their stupid act?

@24 AEF ' The world is awash in blood because two sociopathic brother's (Dulles Brothers) took over US foreign policy and eventually killed a President. '

Ain't that the truth. Because of those two and their succeeding stream of 'investment bankers' at the CIA.

@33 SS from your link 'UN Secretary-General Ban Ki-moon said he was "deeply dismayed" by the Saudi execution of 47 people including prominent Shiite cleric Nimr al-Nimr, who has been critical of the Sunni royal family and was a driving force behind anti-government protests in 2011.'

Ban Ki-moon is a US poodle, so this further indicates to me that USrael wouldn't mind at all if there were a change in management in Saudi Arabia ... and if the place goes up for grabs, why they - NATO - will just have to step in to provide 'stability'.

jfl | Jan 4, 2016 7:47:02 PM | 36
SS@34

Iran is not known to allow irate citizens to run amuck so it might be a planned Basij attack on the KSA Embassy, they certainly came prepared to torch the place and met little resistance from Iranian security.

Wayoutwest | Jan 4, 2016 8:03:51 PM | 39
@24 AnEducatedFool,

Would the Wahhabis be equivalent to a Christian Reconstructionist movement gone militant with state funding?

@39 ATH,

I don't see how we can say policies are decided at the ballot box unless they can recall their "representatives" as easily as they can elect them. It's part of the weak-mindedness of liberal society that management somehow equals democracy.

Jonathan | Jan 4, 2016 8:09:21 PM | 41
@Wayoutwest

"Iran is not known to allow irate citizens to run amuck so it might be a planned Basij attack on the KSA Embassy..."

The same can be said about any country in the world and there is no need for a militia to do that. It is a well known facts, maybe not by you but among those who are following the real news, that the more than 10 or so Iranian embassies and consulates ransacked et pillaged during the 80's in the European cities were all done under the complacent eyes and noses of the security services of the protecting states. In actuality I believe doing it the Iranian way, i.e. keeping a façade of deniability, is more honorable that what the European state did... and for some are still doing.

ATH | Jan 4, 2016 8:16:38 PM | 43
@44 ATH,

I'm uneasy about Rouhani's rapprochement with the usurious Western financial sector[1], but from a systems standpoint I'm more worried about corruption in the assemblies than the figureheads. The usual failure mode of republics is that there is nothing binding the alleged "representative" to the popular will post-election and no effective means to stop disloyalty in progress. In the US, especially, we've had ample experience with "representatives" who, as an assembly, invariably take on some sacred duty of delivering concrete material benefits to elites while delivering excuses and pat stories (according to their Party's mythology) to their constituents. The question always on my mind is, how to prevent the color of public interest from enabling disproportional private benefit?

It could be that I'm not thinking Islamically enough with respect to the roles of citizens within an Islamic society. But if Iran has a system that guarantees sturdy alignment of policy outcomes with citizens' collective interests, even against vested interests of state officials, I'd love to hear it.

[1] Islamic finance on Wall Street would mean dropping shock troops onto one end and chopping every right hand down to the other end. I doubt I will be seeing this in the near future.

Jonathan | Jan 4, 2016 9:42:01 PM | 51
@44 ATH,

I'm uneasy about Rouhani's rapprochement with the usurious Western financial sector[1], but from a systems standpoint I'm more worried about corruption in the assemblies than the figureheads. The usual failure mode of republics is that there is nothing binding the alleged "representative" to the popular will post-election and no effective means to stop disloyalty in progress. In the US, especially, we've had ample experience with "representatives" who, as an assembly, invariably take on some sacred duty of delivering concrete material benefits to elites while delivering excuses and pat stories (according to their Party's mythology) to their constituents. The question always on my mind is, how to prevent the color of public interest from enabling disproportional private benefit?

It could be that I'm not thinking Islamically enough with respect to the roles of citizens within an Islamic society. But if Iran has a system that guarantees sturdy alignment of policy outcomes with citizens' collective interests, even against vested interests of state officials, I'd love to hear it.

[1] Islamic finance on Wall Street would mean dropping shock troops onto one end and chopping every right hand down to the other end. I doubt I will be seeing this in the near future.

Jonathan | Jan 4, 2016 9:42:01 PM | 51
@Lone Wolf

"Pariah status" or "rebuilding" a presumed broken relations "with the world" is what you have been made to believe by the MSM. Iran is actually reducing tension in the nuclear dossier to better work out its strategic realignment that are based on sovereignty and political independence. The first sign of which has already appeared in a strategic alliance in Syria.

ATH | Jan 4, 2016 9:57:05 PM | 55

There is reasonable possibility that the decision by the Saudi dictatorship to execute the high profile Shiite Sheikh Nimr may have been motivated, at least in part, by the desire to deflect the probability of retribution by the Shiite-hating Islamic State since the majority of the 47 executed along with Nimr were comprised of violent, hard-core Sunni devotees of ISIS.

From the Saudi prism, the orgy of executions was on the one hand, a performance intended to downplay growing criticism of the kingdom's funding of the globally despised ISIS and on the other end, an act of appeasing ISIS by killing this highly popular Shiite leader. Nimr's execution could have been intended to mitigate the group's rage and reduce the potential to target Saudi institutions instead of Shiite mosques as they have done in the past.

metni | Jan 4, 2016 10:11:51 PM | 58
@Jonathan

This sounds off topic but for the sake of a reply,

No political system is exempt from corruption and in my opinion this outcome might even be somehow inexorable due to the nature of a state based polity. The difference between the Iranian political scaffolding and the European systems in particular but also, at the limit, the American one is that the former is based on a younger society and still in formation while the latters have already passed the middle-age period in their life cycle.

And to answer your question: "how to prevent the color of public interest from enabling disproportional private benefit?" the only way for this to be possible in my opinion is the breakdown of states with globalist reach into local and regional states with decision-making being directly made by citizens... a Helvetic kind of confederation.

ATH | Jan 4, 2016 10:18:09 PM | 59
Not to forget, nearly a thousand Iranians died during the hajj in Mecca:

The 2015 Mina Crush disaster has increased tensions in the already-strained relationship between Saudi Arabia and Iran, led to calls from politicians in a number of Muslim nations for changes in oversight of Mecca and the Hajj, and bolstered opposition to King Salman among the senior members of the Saudi Arabian royal family.

Oui | Jan 4, 2016 10:51:34 PM | 63
how many think like this author - michael krieger from sept 30th 2015, that there is a conflict at the top in saudi arabia and only a matter of time where one or the other goes? it seems that since Mohammad bin Salman Al Saud was given the position of 2nd in command in sa (and minister of defense responsibility), a lot of shite has hit the fan... this began with the war on yemen in march 26 2015 and continues on in everything else ..

i don't know who is doing what inside the sa hierarchy, but it sure comes across as chaotic and troublesome.. regime change is a distinct probability! which guy goes? the old guy, or the young guy? scary either way..

james | Jan 5, 2016 12:10:18 AM | 70
A couple of assassins and mass-murderers who are grateful for the chance to compare themselves to the Saudis and find the Saudis lacking ...

US warned Saudis of Nimr's execution in advance

"There have been direct concerns raised by US officials to Saudi officials about the potential damaging consequences of following through on the execution, on mass executions, in particular, the execution of" al-Nimr, White House spokesman Josh Earnest said on Monday.
Turkey: Politics behind Nimr's execution
Deputy Prime Minister Numan Kurtulmus told a press conference on Monday that the execution did not have Ankara's support.

"We are against all instances of capital punishment, especially when it is politically motivated," he said.

Both had meetings with the Saudis before their mass beheading festival and could have saved the Saudi junior woodchuck if they wanted to. I wonder what's in the collapse of the present Saudi regime for them? Control of orphaned Saudi oilfields in the one case and of orphaned Saudi Mamluk terrorists in the other?
jfl | Jan 5, 2016 2:48:31 AM | 71
The Real Reason Why Saudi Arabia Executed Sheikh Nimr

by Shireen Hunter

http://lobelog.com/the-real-reason-why-saudi-arabia-executed-sheikh-nimr/

Nor is this mere speculation. Saudi Arabia for some time has been trying to provoke Iran. First there was the Saudi military intervention in Bahrain. Then there were Saudi efforts to topple the Assad regime. These were followed by the bombing of the Iranian embassy in Beirut in 2013, which killed a number of Lebanese as well as Iran's cultural attaché. More recently, during the Haj ceremonies, Saudi authorities harassed two Iranian youth and a large number of Iranian pilgrims died as well. The Saudi government, moreover, created many difficulties for Iranian officials trying to locate, identify, and transfer the bodies of the victims to Iran. And of course Saudi Arabia launched a full-scale war in Yemen against what it claimed were Iranian-backed rebels.

Another provocation came last month when Nigerian authorities arrested the country's Shia leader, Sheikh Ibrahim Zakzaki, and the Nigerian army killed close to a thousand Shias for spurious reasons. Following Sheikh Zakzaki's arrest Saudi King Salman reportedly congratulated Nigeria's president for dealing effectively with terrorism (the king's definition of terrorism apparently extends to the peaceful observance of religious rituals). Meanwhile, the abuse of the Shias in other countries, notably Azerbaijan, continued as did their indiscriminate killing by Saudi- influenced groups in Pakistan and Afghanistan, as illustrated by the beheading in November of a nine-year-old Hazara girl in Afghanistan.

virgile | Jan 5, 2016 9:38:11 AM | 75
One also shouldn't forget that there's struggle going on between the "Group Abdullah" and the "Group Salman".

Abdullah was the former king and Salman is the current king of Saudi Arabia. Former king Abdullah and his "followers" did A LOT OF things to reduce the influence/power of the "Group Salman". E.g. Abdullah appointed his followers to influential positions.

But now with Salman on the throne, Salman is doing the same thing with his followers. Appoint as much of followers to influential positions as possible. And it seems the struggle is far from over.

And Saudi Arabia is in "not the best of financial shapes". No surprise there. A combination of:
- Falling/Fallen oil prices.
- VERY large military expenses (Yemen, Syria).
- Increased expenses for the saudi population. Saudi Arabia increased payments to its citizens to bribe them into not revolting during & after the "Arab Spring" in 2011.
- ((Very) large) subsidies for Healthcare, electricity, gasoline.

Recently the saudi government increased the price of gasoline by 50% (!!!!) from 15 cents to 22 cents. Outrageous !!!!!!!!

Willy2 | Jan 5, 2016 9:38:47 AM | 76
@onatan@73

Aircraft keep falling out of the sky over Yemen quite regularly. They are always described as the result of 'technical reasons'. That covers a whole range of possibilities from engine failure to back end of aircraft disappearing after missile strike.

Here is a report on a recent incident (30 Dec) involving a Bahraini F-16.

Thanks for those links, it's been my impression Yemen army/Houthis have no flak capability, hence the Saudis control of the skies, and the carnage on civilians/damage to infrastructure.

I have read news of Saudi fighter jets downed over Yemen due to "technical failure" as you mentioned, that could or could not be the Houthis/Yemen army. I certainly hope they develop AA defenses, as the Vietnamese progressively did, that would help diminish the carnage and will give the Saudis a pause in their impunity.

Lone Wolf | Jan 5, 2016 11:57:11 AM | 83
The U.S. Doesn't "Need" to "Stand With" the Saudis

http://www.theamericanconservative.com/larison/the-u-s-doesnt-need-to-stand-with-the-saudis/

D | Jan 5, 2016 7:59:23 PM | 94
Yesterday, I saw a headline on (I think) RT that said the US was "standing with the Saudis"
Today, I saw this.

Bloomberg oah Feldman: U.S. Can Afford to Side With Iran Over Saudis

To be sure, the Iranian government is a complex organism with many moving parts, and the whole response likely wasn't planned or coordinated by a single actor. But the result was highly effective. It showed the Saudis that Iran took the execution as directed toward it. And it simultaneously gave other countries the cover they would need to side with Iran.

The Americans, rather remarkably, took the Iranian side. U.S. Secretary of State John Kerry let it be known that he was talking to his Iranian counterpart, Mohammad Javad Zarif. In the past, a U.S. secretary of state would've reached out solely to the Saudi foreign minister, not least because there were no official diplomatic ties to Iran. Meanwhile, a former deputy CIA director, Michael Morell, publicly praised the Iranians for their handling of the situation in Tehran. This was downright astonishing, given Americans' historical associations with embassy occupation there.
bqqTo be sure, the Iranian government is a complex organism with many moving parts, and the whole response likely wasn't planned or coordinated by a single actor. But the result was highly effective. It showed the Saudis that Iran took the execution as directed toward it. And it simultaneously gave other countries the cover they would need to side with Iran.

The Americans, rather remarkably, took the Iranian side. U.S. Secretary of State John Kerry let it be known that he was talking to his Iranian counterpart, Mohammad Javad Zarif. In the past, a U.S. secretary of state would've reached out solely to the Saudi foreign minister, not least because there were no official diplomatic ties to Iran. Meanwhile, a former deputy CIA director, Michael Morell, publicly praised the Iranians for their handling of the situation in Tehran. This was downright astonishing, given Americans' historical associations with embassy occupation there.

Susan Sunflower | Jan 6, 2016 1:50:10 AM | 97
metni says:

Further efforts devoted at tightening our embrace of the House of Saud is less a choice than a consummation of an existing Faustian bargain

Faustian bargain? it's fucking national security doctrine .

Let our position be absolutely clear: An attempt by any outside force to gain control of the Persian Gulf region will be regarded as an assault on the vital interests of the United States of America, and such an assault will be repelled by any means necessary, including military force

john | Jan 6, 2016 9:05:15 AM | 99
@Lozion@96

Can any of you recommend a good blog/site following the events in Yemen? With the media blackout it is very hard to find out was is really going on on the ground.. Txs.

Try the Russian Defense Forum, they have two sections on Yemen, Yemeni Conflict: News, and Yemeni Conflict: News #2.

There is very little news on Yemen, and I don't know of any bloggers following Yemen per se. Hope that helps.

[Jan 10, 2016] Neoliberalism Raises Its Ugly Head in South America: Washington Targets Venezuela, Brazil and Argentina

Notable quotes:
"... The USA used to complain about Japan Inc. Of course now its USA as Neolibraconia Inc. and its business is war along all lines : military, economic, environmental, social ... ..."
www.counterpunch.org

After 9-11, the United States focused its most aggressive foreign policy on the Middle East – from Afghanistan to North Africa. But the deal recently worked out with Iran, the current back-door negotiations over Syria between U.S. Secretary of State John Kerry, and Russia Foreign Minister Sergei Lavrov, and the decision to subsidize, and now export, U.S. shale oil and gas production in a direct reversal of U.S. past policy toward Saudi Arabia – together signal a relative shift of U.S. policy away from the Middle East.

With a Middle East consolidation phase underway, U.S. policy has been shifting since 2013-14 to the more traditional focus that it had for decades: first, to check and contain China; second, to prevent Russia from economically integrating more deeply with Europe; and, third, to reassert more direct U.S. influence once again, as in previous decades, over the economies and governments in Latin America.

... ... ...

Argentina & Brazil: Harbinger of Neoliberal Things to Come

Should the new pro-U.S., pro-Business Venezuela National Assembly ever prevail over the Maduro government, the outcome economically would something like that now unfolding with the Mauricio Macri government in Argentina. Argentina's Macri has already, within days of assuming the presidency, slashed taxes for big farmers and manufacturers, lifted currency controls and devalued the peso by 30 percent, allowed inflation to rise overnight by 25 percent, provided US$2 billion in dollar denominated bonds for Argentine exporters and speculators, re-opened discussions with U.S. hedge funds as a prelude to paying them excess interest the de Kirchner government previously denied, put thousands of government workers on notice of imminent layoffs, declared the new government's intent to stack the supreme court in order to rubber stamp its new Neoliberal programs, and took steps to reverse Argentine's recent media law. And that's just the beginning.

Politically, the neoliberal vision will mean an overturning and restructuring of the current Supreme Court, possible changes to the existing Constitution, and attempts to remove the duly-elected president from office before his term by various means. Apart from plans to stack the judiciary, as in Argentina, Venezuela's new business controlled National Assembly will likely follow their reactionary class compatriots in Brazil, and move to impeach Venezuela president, Maduro, and dismantle his popular government – just as they are attempting the same in Brazil with that country's also recently re-elected president, Rousseff.

What happens in Venezuela, Argentina, and Brazil in the weeks ahead, in 2016, is a harbinger of the intense economic and political class war in South America that is about to escalate to a higher stage in 2016.

jfl | Jan 8, 2016 6:08:12 PM | 10

The USA used to complain about Japan Inc. Of course now it's USA as Neolibraconia Inc. and it's business is war along all lines : military, economic, environmental, social ... Jack Rasmus has an excellent survey at Neoliberalism Raises Its Ugly Head in South America: Washington Targets Venezuela, Brazil and Argentina .

The war on the homefront seems won as far as Neolibraconia is concerned, at least the lock-up, see A Minimal Demand: Roll Back Incarceration to 1970 Levels , and here are pictures: animated and still .

That report from FARS