As you say, “its about power and control.” ThePowersThatBe are not willing to share power with the masses. They ARE willing to spend billions to protect their trillions. They spend billions on the Media Matrix, and billions more on what I would call a counter insurgency effort against anyone who threatens to slow them down.
Max is on to something with AdBusters, but a 1000 fold increase in their activity would be required to make a dent in mass consciousness.
It is nice to talk about how things should be, but how about a road map / action plan for getting there?
in terms of road map, I hope to deliver something, though I doubt it’s going to be what people want to see. my sense is people want a new money plan. there are plenty of those already. I’m in most agreement with Nathan Martin’s Freedom Vision. but the problem is, as you say, the roadmap of how to get there. that’s a Machiavellian chess game against the most powerful interests in the world. that’s the hard part. in fact as I say in this interview, I think it’s impossible without a bottom-up spiritual awakening.
Well, it seems perfectly obvious how to spark a bottom-up spiritual awakening…
First, crank up the AdBuster activity.
Second, write a stirring call to arms that fits on a 3×5 card and
Third, pass it out to all the people living in tent cities in the USA today.
And finally, make a movie starring Keanu Reeves as a long term unemployed AdBuster guy who visits your website and ‘Gets It’.
Feel free to use this as a template.
A suggestion to get from here to there. Start at local community level. Opt out of federal system. What happens if a local “community bank” designed as a utility service is formed? It’s purpose to handle interface with the fiat system outside the local community. All settlements are paid in gold (can’t be counterfeited, and retains value). All bank members convert their cash to gold. They all stop paying interest and taxes to the federal system. You say they all go to jail? Maybe. But as the local communities grow in number, going to jail for violating the “legal tender” laws, for not paying “taxes”, for not participating in usury any more, for not helping maintain the fiat power system any more, might be preferable to being killed in violent uprising against the government condoned criminal class.
Starting at the local community level is correct. However, the history of the Liberty Dollar http://en.wikipedia.org/wiki/Liberty_Dollar
shows that a precious metal based ‘competing currency’ will draw down the weight of the FBI and Secret Service on your head, and they will confiscate your gold as well.
I think a LETS (Local Exchange Trading System) is better http://www.letslinkuk.net/home/theory.htm
mainly because it does not need any gold or other ‘money’ to get started. All it needs is the local community members who trust each other and have something to offer. (In today’s hyper-specialized world, having something to offer is less likely than in the past but what else can we do?)
In any event, the United Police States of America will make sure your tax burden is paid in full. You can be a debt slave at home, or in prison; enjoy what freedom of choice you have left.
I used to like Jim Kunstler’s rants about how the FedGov will not be able to answer the phones in the near future, much less imprison the uppity. But people like Damon have got me thinking TPTB will find a way.
I’ve discussed things with Kunstler and his mistake is in thinking the fed govt and politicians are in charge. Even if he’s correct that the US govt will break down (I think the fascist stage will come first), you can see how that would play into the hands of the power structure I laid out in lessons 4 and 5.
you comment in the lessons there are different factions in the power structure, and neither the FEDs or politicians are in charge. Given that, do you see any possibility of ANY of the power structure factions supporting a “slave” rebellion?
If not, then logically any slaves who do fight back will be killed. Under these conditions, what are the options?
I just discovered your web site and work yesterday through a link via either http://www.brasschecktv.com or http://www.realecontv.com . Both are sites offering alternative (truth) views and should be contacted if you are not already connected with them. Also check out http://www.thedailybell.com for a potential guest editorial or interview.
Your teaching modules, Renaissance 2.0 and Debunking Money, are the most succinct and lucid presentations of the complex global capital system which has enslaved most of the population, and which is the real enemy of those cherishing freedom. I am forwarding your teachings and web site to all my contacts. I agree with you that any true change must originate with each of us at the local and state levels, and that the people of America and the world must awaken spiritually, psycologically and economically NOW! May God guide you, Max and all who choose to open their hearts and minds to enlightenment and freedom.
I’d like to read what you think about the U.S. petrodollar and it’s, by-force, impact on the empire, world and the coming currency wars.
Also, I’d like to read your opinion of how the empire’s wealth is distributed. If you accept “empire” as a fact, the next question is how its administered. I posit its administration has been to serve the interests of international capital, exclusively. It is this point, I think, which has the most resonance with the average Joe. Like, Rome, it would have fallen in 100 years if the spoils of war were given away to corporations in Gaul but the costs shifted to the Roman treasury.
This seems most apparent to me, others, is easy to teach. Once that lesson is absorbed, I’ve noticed the next about the Fed (or rather the regulation of banks and the top tiers) begin to make more sense.
I get the most head nods when I discuss the use the of the U.S. Military to serve international capital, at the expense of the U.S. Treasury.
Whether war or peace, you can at least administer war (or other distasteful decisions) in the interest of your citizens.
you’re generally correct. we’ve been the muscle for international capital. that served us materially through the 20th century (while destroying the republic in the process), but it’s going to come back to bite us BIG time in the 21st.
Thank u for lesson 6 part 2!
I’ve been saying this for years. BIG/SCALE v. SMALL/EFFECTIVE. I’d love to contribute some anti-trust framework (Teddy R v. silent Holder) into your concepts.
The fascism of size is such a problem.
I’ve also been telling people who like Paul Krugman or Milton Friedman or whatever the case may be, the arguments have been going back and forth for decades with no change, except they all serve the same master.
When I tell people that Paul Krugman fits the NEW YORK times perfectly, they don’t get what I’m saying. They think it’s because I think he’s liberal and the Times is liberal, therefore, that’s obvious. They have no clue I’m speaking on a different level. Krugman serves New York banking as much as anyone thru his bigness of debt solutions. Bush serves them when he goes to war. After all, it was the NYTimes that pushed this country from 55% opposed to war to 55% in favor.
Oh, the establishment Damon…. how they all serve the same poisonous master. The silly NYTimes readers who think they’re radical liberals who oppose banks and neocons have no idea they’re in the HEART of both….
you got it! The only success I’ve had in terms of getting some people to see through the left vs. right fog is explaining how Wall St benefits more from welfare than the poor. That intrigues people enough to listen to my explanation. Then it’s a matter of whether they can comprehend it or not. It’s what I explain in lesson 6.2 of Renaissance 2.0 and lesson 3 of Debunking Money…the government has been taken private.
“…We CAN create money as debt, but MUST we? Can we also create money some other way? Yes and No. We can lend, spend, reward, or gift money into existence but the creation is always accompanied by a debt.
Money represents the right to goods and services. Those goods and services have to come from somewhere — that is, someone has to provide them. Therefore money also represents an obligation to deliver goods and services. Who is obligated to deliver those goods and services varies.
If I as an individual issue money, who will deliver the value that it represents? I must not obligate someone else to deliver that value — that would be a kind of theft or fraud. Likewise, I must not obligate myself beyond my ability to deliver. That too would be irresponsible. If I issue money, then I must acknowledge (implicitly or explicitly) that *I* am obligated to deliver that much value to society. It is a debt.
Likewise, a community or nation cannot obligate the rest of society to deliver goods and services. A community or nation can create money responsibly only by obligating ITSELF to create the value that the money represents. Even if we as a society create money, for example, as a reward to an individual for work they have already done or as a grant to a nonprofit, the money is a promise that the rest of society will provide that much value (goods and services) to the individual or organization, on demand. It is a debt.
Money is a promise of goods and services. Money is always debt, by its very nature. We MUST create money as debt — and only as our own debt to society. Anything else is irresponsible.”
If some sort of money system is used as an exchange for goods and services in order to live your life, whether it is paper currency, gold, silver, whatever, then money will always be the problem. It will end up with someone controlling the money supply and will end up in the concentrated hands of a very few. Money is the ultimate control over human life. I Used to think that if you work hard, you will be rewarded, but that is no longer the case. My eyes opened once I read the book, “creature from Jeckyll Island” by G. Edward Griffin. He does a good job of explaining the Federal Reserve and exposes what it is. Once you understand the Fed, then you can have a much better understanding of what Damon is trying to explain in his video series. I have given this much thought. He is correct in saying that we need a human awakening to what is happening to us ALL. They built up an incredible matrix where people live in servitude to the masters and have conditioned the mind to learn to love being a slave. You cannot escape the matrix until you realize what has happened to you as a human being. Once enough humans wake up, if ever, then we have a chance at wiping out the evil that enslaves us all. Then we can come to the round table and figure out a system where all human life is valued, live in peace, respect each other as being different, but yet realize that we all come from the same strand of DNA and we all contribute something to our survival on this planet.
However, I am very aware that this is wishful thinking on my behalf and will never happen. Truly, evil rules on this planet. For now, we need an army of people waking up by spreading the truth and exposing the elitists agenda for all human modern day slavery. You can take some control back, don’t buy cheap shit from the likes of Wal-Mart, don’t feed your body with crappy corporate food and big pharma drugs, and as difficult as it is, don’t buy corporate made shit. Corporate needs large profit margins to expand and exist, so try not to support it. Rather, support local vendors and if you eat out, eat at local restaurants. Barter as many services as you can.
Todd, yes money always has an obligation. The question is who controls and benefits from it, who is it a debt too, and does it have interest attached. As I try to explain in lesson 1, it’s the fact that the debt money system is entirely controlled by a tiny group of private capital holders at the top and an interest-bearing debt to everyone else that is the problem.
But I think we should have an asset component to the monetary system–fiat money issued based on infrastructure projects, i.e. expanding the supply-side of the economy. It would be an asset to the people and therefore an obligation of the government. Getting such money into the system is the only way to start winding down the debt dollars and reduce the pain of the coming austerity since the people have no permanent money.
Damon said: “Getting such money into the system is the only way…”
Whoa now, statements such as these put my hackles up just a tad friend.
“The people I distrust most are those who want to improve our lives but have only one course of action.” Frank Herbert
Asset based, debt based, commodity based. . . Surely you agree that any financial instruments that we use, as long as they have been emancipated from the control matrix (a.k.a. Corporate/State hierarchy marriage) and are directed democratically with equal representation are the ways in which we may “leave the farm.”
This is why I have chosen to represent Common Good Bank. It does not claim that federal reserve notes are the only instruments through which we may conduct business, but simply that they are the most powerful at this time within the USA context. If one or more of our community divisions were to decide that they wanted to issue an asset based community currency then CGB would use every avenue at it’s disposal to properly represent these communities and empower them with the federal reserve notes needed to activate the communities mutual credit capabilities.
I’ve asked this question now 3 times and have yet to get an answer, so I’ll ask again.
Can we put the speculative banks through bankruptcy – NOT to “teach them a lesson” but the write the debt off, so it doesn’t end up having to be paid for BY US – if we bring back Glass-Steagall? Wouldn’t that give us the opportunity to seperate people’s savings (which needs protection) from speculative debt (which needs to be written off)?
I for one am NOT from simply dismantling the society and going “every man for himself”. This is dangerous for all of us, and anyone who thinks they can take on the US military with a few shotguns and a big tub of dried beans needs their head examined.
As far as money is concerned, we can use it as a convenient form of credit, provided that the PHYSICAL PRODUCTIVITY of the society is protected by the vigilance of the people and their representatives. Otherwise, you have monetarism – which allows the few at the top to liquidate the physical economy of all societies while passing out worthless pieces of paper so that people don’t notice they no longer have any factories, infrastructure, or jobs doing anything real until it is too late.
So, please…answer question about Glass-Steagall? It is a good question.
hi Kylie, sorry I’ve missed your previous questions…it has become difficult for me to keep up with the comments on some previous posts. Frankly I need a forum integrated with this blog so we could have better conversations. Unfortunately wordpress doesn’t offer that.
Glass-Steagall is certainly an absolute minimum. However, I’d recommend FAR more in terms of restructuring the financial system. As long as we have a system that’s 100% controlled by private global capital and 100% based on interest-bearing debt to them, it would only be a matter of time before their concentrated power would takeover government again and repeal Glass-Steagall again.
In terms of bankruptcy, I don’t think Glass-Steagall would solve the problem we’re already in. It would have to be a far more powerful general breakup of all large financial institutions into component parts. I think the only way to do it in a way that protects the small guy would be to take them into government receivership, i.e. nationalization, as I think Bill Black has proposed, and then put guys like him in charge of the process (people with NO connection to Wall St who aren’t sucked in by their fratboy schmarm). As long as it stays in the courts hands, the law requires them to serve the big guys and screw the little guy as they writedown debt.
I don’t mean to be negative. I just want to encourage caution regarding the appeal of easy, simple solutions. We’re in an unprecedented problem…we either fully nationalize and restructure the financial system, ala Indira Gandhi, or we’re going into the new global system. It’s that drastic.
Off topic: Over the Peak has managed to set up an interesting forum on WordPress, if you’re interested in investigating something similar. http://overthepeak.com/wordpress/
Thanks, your presentations are immensely informative.
This paints a very solid picture of where we are today monetarily and maps reasonably well with Damon’s videos. They don’t mention the “senior capital pools” but do get the point that all money is debt. Plus they throw in the Wizard of Oz allegory that demonstrates how people have been fighting the banksters forever. Ellen Brown, who posts here occasionally, makes a few appearances.
Their solution is to get rid of the current system with help of the govt then have the govt control money supply by issuing “greenbacks”. If recessions occur in this environment, the govt will inflate money supply. They also talk about how Sweden issued money to community banks who lent it out locally, which decentralized power and made banks act like utilities. The author/producer of this documentary has never heard of Austrian Business Cycle Theory and firmly believes in the Friedman/Schwartz analysis of the Great Depression (like Bernanke), which doesn’t account for the huge inflationary Fed practices before 1929 that blew up the bubble in the first place.
These “greenback” and monetarism solutions bring up questions like:
1. When has any govt ever maintained “rational” spending levels for long periods of time? Monarchs, religious empires, dictators and extreme nationalists always seem to sprout when they have control of the purse strings.
2. What’s wrong with PRICE deflation like the US had in the 1800′s? (Not money supply contraction but price deflation as seen in the technology industry today.)
I get very nervous about putting so much power into the hands of Congress/”the few”, who inevitably use that power for empire building and control. I guess the case could be made for state govt money supply controls and competing currencies, which would provide a check on spending and allow the best run currency to win out over time. This solution would increase the price of transactions possibly but would be outweighed by the savings of less interest payments.
fyi, what I call “senior capital pools” = what Bill calls “banksters.”
I think sovereign, fiat money (what Bill/Ellen call the greenback system) is a necessary component to a solution but can’t be the only source of money in the system. I like Nathan Martin’s Freedom Vision which has 1) sovereign money as the base, 2) state banking power, and 3) retail banking. (of course all that assumes we want any monetary system at all in the future…I just want to leave open the possibility that perhaps we could pull off an entirely new system without money)
re #1: I think most of those things you mention demonstrating poor money management were in fact funded by private bankers just like our government is today. There is a massive difference between a top-down imperial government accountable to bankers vs. bottom-up commonwealth government accountable to the people. Your concerns about irresponsible government are valid…any realistic fiat money plan would involve strict definitions tying money creation to value creation vs. the random whim of a politician.
re #2: My guess is Bill would be fine with price deflation. He is referring to money supply contraction.
Competing currencies is a bad idea. That would be freedom for the moneyed elite and continued servitude for the masses who would be whipsawed in worse ways than they are today under the regulation of the Fed. “Best currency would win out” is appealing free market language that in reality means “millions of little people would become destitute if they were in the losing currencies.” The people should agree to a commonwealth currency…a people’s currency rather than a few elite currencies fighting for the next monopoly. At this point, who could possibly compete with electronic digits from JPM Chase? That’s quickly becoming the next monopoly currency. Only government reasserting sovereignty will stop that. Unfortunately I think Ron Paul’s ideas for competing currencies are well-intentioned but very ill-advised given the current power structure.
I decided to go hava look at a “One dollar bill”, and yep it’s right there in plain sight. Firstly, it is clearly marked as a “Federal Reserve Note”, not US “money” or “capital”, and it also clearly states that “this note is legal tender for all DEBTS, public and private”.
Also, on the “reverse side” of the note, there is a pyramid, with a great eye at the top with the latin, “Annuit coeptis” literally translated as “He approves (or has approved) [our] undertaking(s)” (wickipedia). Also from wiki: “The Eye over it [the pyramid] and the motto Annuit Cœptis allude to the many signal interpositions of providence in favor of the American cause.” The other motto, “Novus ordo seclorum” , is latin for “New Order of the Ages”. Interestingly, the phrase also appears on the coat of arms of the Yale School of Management, Yale University’s business school.
The state as part of any social solution? I don’t believe so. The USA is the worlds best example of a nation that had laws to keep its government small, and now it is the worlds biggest and most well armed state.
How will it look if financial power shifts from private corporations plus the state to just the state?
A government that works in the interests of ordinary people is a contradiction.
That’s my critical stuff. On a positive note, I think we need to get into a state free society based on voluntarism. In terms of currency, I like the idea of the digital coin, where everyone generates their own currency totally free of a monopoly.
I really enjoyed the Max interview. I plan on watching the whole series soon. I’m curious about your education, i.e., how you came to these ideas, this understanding regarding money. What have you read that you would recommend?
Hi Doug, I had to deprogram myself from my education and everything I’ve read to see reality. As far as I know, there’s nothing in print that correctly explains it. I erased what I was taught, then started from scratch with an understanding of how money is created, and then everything flows quite naturally from that.
I’m asked this question a lot. It has a subtle, embedded assumption that we can’t perceive reality on our own, that someone must have a source or some referenced “authority” to have a viewpoint. We must overcome that. It’s the way we’ve been enslaved…trained to think that we can’t be firsthand perceivers of reality but must be secondhand receivers of it.
Damon, you make a very good point here. The proverbial powers-that-be do not want the people to think for themselves and come to an understanding of reality on their own. A quick scan of the arrogance of the elite reveals as much. A lot could be said on this topic (scientism, et al.).
You did mention Steve Keen and Michael Hudson and I’ve learned a lot from them as well. Keep up the good work!
Unfortunately, Damon is correct. There is no “authority” that can provide you the answers. Fortunately, what really matters is asking the right questions, and doing so constantly. Reality is not static, but dynamic.
The first step in asking the right questions is recognizing that economics are politics. Nothing more. Nothing less. At the end of the nineteenth century, “political economy” was rebranded as economics to market political falsehoods as scientific facts. These falsehoods benefit the major capital pools Damon describes, to the detriment of everybody else. They learned long ago that you can determine outcomes by defining the rules of the game, and he who owns the gold, makes the rules.
There are three modern economists who make a living off of debunking their profession: Michael Hudson; Steve Keen; and Jamie Galbraith. None of them presents as complete a picture as Damon, but Michael Hudson is the one who comes the closest and does so in layman’s terms. Steve Keen is a total wonk, but that means he provides sources to back up his statements, so you can confirm what he asserts for yourself. Jamie Galbraith is stuck in the left v. right frame and tends to get partisan, but he is insightful.
Other “debunkers” that can help you question conventional wisdom more effectively include Henry George (check out his “Progress and Poverty” at Google Books), Thorstein Verblen, Gunnar Myrdal, John Maynard Keynes (“Keynesianism” doesn’t include much of Keynes’ actual thinking), Hyman Minsky, and John Kenneth Galbraith. George, Verblen, Myrdal and Galbraith are very easy to understand. Keynes and Minsky can be extremely wonky, and Steve Keen actually does a pretty good job of making their work more accessible.
Here’s a link to Michael Hudson’s site (lots of good stuff there):
Here’s a link to Steve Keen’s latest post, which provides lectures from one of the courses he teaches about what’s wrong with mainstream economics (he has an eBook on the topic, as well):
Jeez, not one “neoliberal” thinker belongs in your list of people who see monetary and power-structure reality? Not even the guys who predicted the current mess or understand how business cycles are formed? How about Gore Vidal, Martin Van Creveld, Murray Rothbard, John Williams, Schiff, etc.? (I know you and Damon think the Austrians don’t “get it” fully, but they’ve been saying that the real power lies with the money masters like Morgans, Rothchilds, Rockefellers, Warburgs, etc. for many decades. )
Most of those economists/thinkers you mention (JK Galbraith? Really?) favor centralized planning/control to one degree or another and have no problem using force to attain it. Are you a believer in the non-aggression principle? Do you believe that wars end depressions b/c many of the people you mention do believe that? (BTW, I did enjoy that Keen article and will check out his lectures. Great recommendation!)
I guess I’m calling into question your belief in decentralized, community-based systems being the long-term solution. To me, that seems to be over-riding lesson from Damon’s videos along with a change in our philosophies about domination, predator/prey and interdependence.
First, my goal was to point people towards thinkers who question conventional wisdom. Neoliberalism is the current conventional wisdom, and I view the Chicago and Austrian schools as the main peddlers of that wisdom as it was Friedman, Hayek and Mises who architected it.
Second, a lot of neoliberal ideas have been transmitted into right wing groups, which mix and match them to suit their ideology. The John Birch Society, for example, would be blaming the Rockefellers and Rothschilds for all the evils in the world without Austrian School economics. There are certain animosities that run deeper than economics.
Third, I included the disclaimer that none of these people has the answer, but that they ask really good questions (JKG’s “Economics of Innocent Fraud” is a good example of this, and there’s no push for central planning).
“Most of those economists/thinkers you mention (JK Galbraith? Really?) favor centralized planning/control to one degree or another and have no problem using force to attain it. Are you a believer in the non-aggression principle? Do you believe that wars end depressions b/c many of the people you mention do believe that?”
Your questions assume facts not in evidence. While I have no problem believing that one or more of these people has noted a correlation between the end of depressions and the start of wars, that is not the same thing as recommending war as a policy for ending a depression. I can’t imagine JKG doing so. Neither can I imagine Keynes making that kind of policy recommendation.
“I guess I’m calling into question your belief in decentralized, community-based systems being the long-term solution. To me, that seems to be over-riding lesson from Damon’s videos along with a change in our philosophies about domination, predator/prey and interdependence.”
We have a purity test now? Time to start banning books and disappearing people we disagree with?
Again, the goal was to identify people who were particularly good at questioning conventional wisdom. Their answers are besides the point. The reason I could not recommend people like Mises, Hayek, Mises and Rothbard is that they proclaim that they have the answer and all others are wrong: their answer overwhelms their questions.
Another way to come at this is to describe what I’ve encountered while reading pretty much anything written by philosophers and economists. Inevitably, what I see is a two stage process. First, there is the “descriptive” stage in which the thinker describes how they view world as it is. Second, there is the “prescriptive” stage in which the thinker prescribes how the world must change to conform to his utopic vision. Where everybody screws up is in the second stage . . .
My recommendations were based on Doug still being in the “descriptive” stage of his thinking. I did not even think of those people’s prescriptions because I don’t think their descriptions are complete. What I admire is the process they used to arrive at their descriptions, which is much more open-ended. To me, Hayek, Friedman, Mises and Marx are like peas in a pod because once they arrived at their descriptions, their prescriptions became violently dogmatic, leaving no room for disagreement or debate.
You’re right about most “schools of thought” thinking they’re the masters. That does get to me. Intellectual bigotry is annoying.
That’s why I’m on the decentralization and non-aggression kick once we move to a different monetary system. Who knows what will work if we allow people to try multiple solutions? Imagine if, somehow, the US could adopt the Swedish notion of “lagom” into our culture on a mass scale. Things would assuredly change for the better.
Since you think you got Mises and the “Austrian School” pegged as a contributory root of the evil of Neoliberalism I thought you might enjoy this little nugget from “history” as recounted by Milton Friedman in his recollections of the Mont Pelerin Society meeting in Switzerland in ’47:
“Although all the participants shared the same basic values, they were by no means agreed on how to counter the attack on those values, or on the policies required to implement them. As a result, our sessions were marked by vigorous controversy over such issues as the role of religion and moral values in making possible and preserving a free society; the role of trade unions, and the appropriateness of government action to affect the distribution of income. I particularly recall a discussion of this issue, in the middle of which Ludwig von Mises stood up, announced to the assembly “You’re all a bunch of socialists,” and stomped out of the room, an assembly that contained not a single person who, by even the loosest standards, could be called a socialist.”
Tao, given how you feel about say a Mises or a Rothbard: “that they proclaim that they have the answer and all others are wrong”, do you think it is appropriate or even logical to lump their school of thought into the same boat with Neoliberals like Milton Freedman?
I am well aware of that quote from Friedman. Mises was a famously difficult personality. Friedman was a famously nice guy to be around. That doesn’t mean they didn’t work together towards a common cause. In fact, they did.
Impressive response time! For some reason it did not include an answer to my question. I agree about what you say about von Mises personality. However I also think he was a person who would never compromise his principles and was quite outspoken about them. Even though I can agree that his statement here is hyperbolic, I also think he was expressing a grain of truth as he saw.
Freedman goes on to say that he stayed away from the Mount Pelerin meetings for 10 years following this first meeting. Would you say they were “working together” during this time? Please enlighten me.
I will make an observation: an outside observer of this blog might state that I and you are both “working together” at this “organization” (Council on Renewal) at this time as evidenced by our posts. Would it be reasonable to conclude that we are working towards a common cause? Or even more strange, of the same “School of thought”?
As I listened to your recent videos, the new debunking presentations, a classic reference jumped to my mind, The Company Store. If I may, I recommend you use it instead of “casino” as an image for a predatory scrip-bound scam of value extraction and enslavement.
Here’s what I’m thinking.
The flamboyant Max Keiser started using “casino” to describe our present economy in order to distinguish old-school investing (buying into a business for its supposed inherent, future value as revealed by legit accounting, sober analysis and conservative projections) from the Wall Street scams being perpetrated now, which I won’t even articulate as you and everyone on this string get it too well. So, his term “casino gulag,” while terrific, is going in another direction than you are when you use the term casino. He’s referring to a house of rigged games of chance owned by predators; you’re referring to the chip-exchange aspect of the same place.
I know you know that, but in the recent interview you two used the same word differently, and I want your message to be as clear as possible. Though I love Max, he’s loud; he’s staked his claim to “casino” in a particular usage, and that’s why I’m recommending company store. You have a larger point to make. To put a fine point on it: Going into a casino is not a civil rights issue; it’s a choice. One most people can distance themselves from through high moralism: “Anyone stupid enough to enter a casino deserves what he gets.” That is emphatically not your message.
Being born into the dollar system, and into a burdensome share of the national debt, is much more like living one’s life in closed-system debt bondage the way generations of miners did merely by being born in a particular holler in West Virginia owned by particular coal company that also owned the only source to the basic needs of life, The Company Store. That is a civil rights issue. That’s why the practice was struck down decades ago, as a form of slavery.
The company store, as sung about in the song “Sixteen Tons,” is a peculiarly American enslavement tool, even though the truck system, if I recall correctly, came before. If it can be explained succinctly, contextualized in our own history, The Company Store scam might illuminate for people the system into which they’ve been born. Their dollar earnings were always just the fancy printed toilet paper of a cabal that issued it in exchange for the people’s labor, their life force, their productivity, their creativity, while the cabal bought up the known world with the people’s debt payments to them over the generations.
I don’t believe a fish really understands that it’s been born and lives its whole life in water. It’s just the way it’s always been. Without having lived in a coal holler, or run a nefarious coal company, I’ll bet as little as 32 years, two generations in a land of teenage pregnancy and black lung, is all you need to make The Company Store “the way it’s always been.” Truly, ours is the first American generation in 100 years to have the opportunity to wake up to the perfidy and do something about it.
Look. Your work is excellent. I doubt very much I’ve been helpful, but it’s critical that folks understand with as much clarity as you and your compatriots on this string and elsewhere can bring that they’ve been set up. Debt is a powerful, remote-control enslavement tool in which the debtor punishes himself, relieving the owner class from having to pay slave-drivers with cat-o-nine tails. Those that don’t understand the scam will, by design, service their debts out of crippling personal shame, in isolation. They have to be awakened to the fact that, under a fiat currency system, this was always going to happen: debt interest eventually goes exponential, collapsing the gag, as Mamet might say. We just happen to be the generation it’s happening to.
I think the Company Store accepting only Company Scrip is a great analogy for all the reasons you said. Who cares that the Owners are gambling with their fortunes when you are a wage slave? Their gambling losses are just one more burden to bear.
Right, right. I believe my maternal grandmother is the only person I know who set foot in one. But I wasn’t shooting from the hip either.
Debt Bondage, while precise and exact, is too generic and academic and doesn’t convey a compelling image into which First World humans will let themselves project. Feudalism, also correct, is too Medieval. In conversational English peonage is confined to the Southern Hemisphere aspect. Serfdom means Russia to most folks, with all the weird baggage that goes with it. Yes, those terms are what you’re talking about, but for Anglo-Americans there are psychological barriers of “olden times” and “foreignness” that readers will use to prevent it applying to them, no matter how apt.
My impulse was to look for an image, besides the imperfect casino, that would help modern Americans see that He Who Prints the Money You Are Compelled to Use Owns You–Always Has. And That’s Slavery.
The Company Store is the best I could come up with. If it can be explained succinctly, contextualized in our own history, several of the barriers of denial I mentioned may well fall away. (And the company store served both Coke and Pepsi–oh yeah, gotta give those miners the illusion of “choice.”)
We have to realize that the coming dollar death is an opportunity to reveal the central banking/debt money fraud, and that we’re in a race to reveal it as such before they switch scrips, rearrange the agencies and pronounce things “fixed,” with all the same enslaving mechanisms rebranded and humming along nicely, tuned up for another hundred years.
Mr. Vrabel, what is wrong with the picture painted in this post?
Working people view money as tokens representing their purchasing power. They are paid the tokens in exchange for their labor. If people are paid a living wage, their purchasing power not lost over time, and given wage increases to cover any increased cost of living, they will be content. If they also have extra tokens they can save for use either to capitalize their own business plans, save for retirement, or spend on leisure activities, they will be even more happy.
The tokens can be added to and withdrawn from the economy, so there are enough tokens to go around, that would be good. Credit can be tokens in advance to capitalize business, or spend for emergencies such as health care, and so on. If people do not have jobs, credit can be issued to insure they can live, until they get jobs. And if the private sector can not supply enough jobs, then projects to improve the standard of living can be initiated by the issuing of credit. And once the business is established any remaining credit tokens can be removed from the economic system. The system described works if the tokens are not counterfeited, and if the supply of products and demand for products, is accounted for in the adding and withdrawing of tokens in the economy, and the adding and withdrawing of credit in the economy, driven by the market. Would it matter in the system described if government or a “bank” is responsible for the issuance of tokens? No, not if the same metric is used to adjust total tokens in circulation, regardless of who adjusts them. Would too many workers and not enough jobs be a problem? Only until new jobs are created, either by the private sector, or the “government”. Such a system would work if “government” purpose was for defense, and maintaining the system to improve the quality of life for all citizens.
Would such a system work? Well, yes. It has worked for thousands of years, up to the present day, every time it has been applied.
Keep the fraud out of the system, prevent criminal racketeering that counterfeits tokens and creates credit in excess of that used to maintain the economy, and the system described can lead to optimum progress to insure an increasing standard of living for every one.
Stop wars of opportunity to steal resources from other countries, stop “government” from perpetuating the mythology that perpetual war creates perpetual peace, and hell on earth created by the criminals will end. And the problem of limited resources? That is a joke. We live in an infinite universe. Time to start mining on other worlds. THAT can be one of the new projects needed to employ some of the people without jobs.
The picture you paint is indeed the way money should work. But the problem with how you frame it is that you mention as sort of simple afterthoughts things like “keep the fraud out,” “prevent criminal racketeering,” “stop wars,” etc. These are the very essence of the problem.
Whoever controls your tokens has the most power in the system, which is the genesis of the fraud, racketeering, wars. So yes it matters greatly whether tokens are issued by a commonwealth type of government vs. an imperial government vs. a few private rich guys, i.e. banks. And history has shown that a commonwealth type government eventually morphs into an imperial government, so even that’s not a guaranteed solution.
The system description I give for local communities needs expansion to explain how the larger corrupting issues, for example fraud, racketeering, wars, can be avoided. To that I reference a Ludwig von Mises article conveniently posted at http://mises.org/MMMP/MMMP6.ASP. Near the end of the article he comments “systematic attempts to regulate purchasing power can only be made through international agreement.” Thus enters the domain of politics, and not purely monetary policy. The system in the thought experiment I outlined previously works because subjective calculation of “purchasing power” is absent. Real world, transparent, economic indicators would be used to compute, objectively, tokens, credit, and velocity, in the economy, with the emphasis on maintaining and improving the standard of living for everyone, and enabling the progress of civilization based on physical economy, for an increasing number of people. Politically this also entails an international non-aggression pack, prohibition of fractional reserve banking, the necessity of holding reserves, prohibition of derivatives, “gambling”, and so on, because ALL these activities render unstable “purchasing power”. Can wars be fought without funding? Can poverty exist if poverty is eliminated by credit issuance to do so? For example credit issued to maintain purchasing power for a project of tearing down the old buildings in cities, and building new buildings and infrastructure. Would we have poor education if government controlled schooling to condition subjects to be work slaves in accordance with the Prussian model (that our schooling system is based on), were eliminated.. specifically because it does NOT improve the quality of life or standard of living of people. Ron Paul is correct that we need to eliminate the federal reserve system, the board of “education”, and all the other societal control institutions and mechanisms put in place to serve the purpose of enabling Oligarchy control.
Thank you for your considered responses. I’ll just drop this statement I’d thought you’d enjoy today by Merkel. While she may have some German self-interest in her position, she has been the only big nation leader who’s even approached heroic or courageous status. I would imagine you could also mix a “spiritual world” interest in this quote in which she distinguishes the financial and political worlds (something that Obama is yet to do)…..
“Let me put it quite simply: in this regard there may be a contradiction between the interests of the financial world and the interests of the political world,” Ms Merkel said. “We cannot keep constantly explaining to our voters and our citizens why the taxpayer should bear the cost of certain risks and not those people who have earned a lot of money from taking those risks.”
Damon has creatively and accurately termed our struggle against debt bondage as a “civil rights” issue and I would add that the international banking cartel is committing crimes against humanity.
I kind of cringed when Max started the interview stating that “fiat” money has never worked and was glad when you astutely corrected him in recognizing the difference between “debt” and “asset” money. Fiat has nothing to do with it and the term simply confuses people as no two people agree on what fiat money actually entails. Tally sticks could be called fiat money and they served Great Britain well for almost 700 years (see The Secret of Oz).
Max asked an interesting question towards the end of the interview inquiring as to who is at the top of the pyramid and you identified the large capital pools (shadow banking) which no doubt manipulate markets on a daily basis to transfer wealth up the pyramid.
I suggest that there is another rung above them that includes the people who hold the private monopoly to create money – the big central banks, the IMF and the pinnacle, the BIS. The central banks are similar to franchises, for example, the privately owned and controlled Federal Reserve is a franchise and their client state is the United States which is financially subservient.
Carroll Quigley wrote in the “Tragedy and Hope, A History of the World in Our Time”:
“The names of some of these banking families are familiar to all of us and should be more so. They include Raring, Lazard, Erlanger, Warburg, Schroder, Seligman, the Speyers, Mirabaud, Mallet, Fould, and above all Rothschild and Morgan. Even after these banking families became fully involved in domestic industry by the emergence of financial capitalism, they remained different from ordinary bankers in distinctive ways: (1) they were cosmopolitan and international; (2) they were close to governments and were particularly concerned with questions of government debts, including foreign government debts…they were almost equally devoted to secrecy and the secret use of financial influence in political life.
The influence of financial capitalism and of the international bankers who created it was exercised both on business and on governments, but could have done neither if it had not been able to persuade both these to accept two “axioms” of its own ideology. Both of these were based on the assumption that politicians were too weak and too subject to temporary popular pressures to be trusted with control of the money system; accordingly, the sanctity of all values and the soundness of money must be protected in two ways: by basing the value of money on gold and by allowing bankers to control the supply of money. To do this it was necessary to conceal, or even to mislead, both governments and people about the nature of money and its methods of operation.
…the powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent private meetings and conferences. The apex of the system was to be the Bank for International Settlements in Basle, Switzerland, a private bank owned and controlled by the world’s central banks which were themselves private corporations. Each central bank, in the hands of men like Montagu Norman of the Bank of England, Benjamin Strong of the New York Federal Reserve Bank, Charles Rist of the Bank of France, and Hjalmar Schacht of the Reichsbank, sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world.”
We are seeing the culmination of this plan today as the central banks (franchises) are being consolidated into a new order that will include a global currency and the ultimate demise of nation states and elimination of private property for serfs – welcome to feudalism.
At the end of the interview Max asked for a solution and I agree with you, that first, a great awakening must occur; a realization that humanity is being enslaved in debt.
Then the solution will become self evident – nation states MUST create their own money, free from the usurious debt of the international banking cartel. Nothing else will do.
You’re correct Larry about the pyramid. But I want to expose the shadow system to the light of day. I don’t think they should enjoy their anonymity any longer.
It is revealing to study the last time The House of Morgan tried to overthrow the constitutional republic. The fascist plot in 1933 failed. The assassination attempt upon FDR killed others but he survived. At the time it was also revealed that the oligarchy of Wall Street had financed Hitler and Mussolini. Even in 1933 the “core” of the financial elite were powerful enough to “almost” bury the facts of the events. They were able to avoid charges of treason and none of the ringleaders even went to prison (although some of them subsequently died under mysterious circumstances). Here is a web site with resources that discuss the “first” time the Morgan banking dynasty was involved in the fascist takeover of the United States of America. It is now 77 years later. And the fascists are much better prepared this time. The Oligarchy Plot To Install A Fascist Dictatorship in the USA – in 1933!
Also in 1933 we saw a financial coup by the bankers via HJR 192 where it was declared to be “public policy” that gold and silver or any other “sovereign money” could not be used to pay your debts except FRNs which of course is debt based currency or in other words is a “promise to pay”. They then established and began to “collateralize” the country’s assets (ever heard the term “collateral damage”?) to fund this “bankruptcy” by creating fictional “strawmen” for every human being via the SSN and Birth Certificate and applied a value to these entities. Since they took away the ability of the people to pay their debts with “real money” (asset money) they had to put in place a remedy per the UCC for the people to “discharge” their debt until “real money” is available once again.
Damon, I have also sent your website to people that I know. Is it possible to download your lessons from YouTube? I would like to put them on a DVD and give them to people. Would you mind this? I too, am looking for some sort of plan to follow. I hope that you are not pegged as leader. You may already be on their radar. I have read of a data base system run by our government in old mushroom caves in PA. Don’t know if it is true but with the massiveness of this financial system I can believe it. Please, let us know what we can do to help. It has to start somewhere. Good Luck, Ron
LOL! You can bet Damon Vrabel is on the radar! Max Keiser, Alex Jones, David DeGraw, Gerald Celente, Ron Paul, John Williams, and too many others to mention all of them, certainly are! And that means all visitors to their web sites are on a list, also, somewhere! Probably more than one. Have you tried flying anywhere lately? Don’t be surprised if you too are on a no fly list! Remember, this is the INTERNET! Any of over 6 billion people can be reading your words at anytime. Easily! Do you really question is Mr. Vrabel on their radar?
“I just want to encourage caution regarding the appeal of easy, simple solutions. We’re in an unprecedented problem…we either fully nationalize and restructure the financial system, ala Indira Gandhi, or we’re going into the new global system. It’s that drastic.”
I agree that our solutions need to be drastic. However, I don’t see that phase change at the national level is going to happen and it certainly is not something that we ordinary people have much to say about. So instead of nationalizing the financial system, let’s “communitize” it and restructure it at the community level where we have a chance of actually being effective.
Any national-level solution is likely to leave our communities at the mercy of big business and distant government. We need a way to plan and invest locally, for thriving local economies and a sustainable future. Imagine a society in which communities everywhere gather to decide for themselves what their funding priorities should be — for sustainable agriculture and energy systems, for local self-reliance, for ensuring that everyone has enough to eat, a home, and satisfying work.
The Common Good Bank™ project aims to give us that, by creating the foundation for a community-based democratic economic system that can also compete effectively within the current economic system (and spread fast). The Common Good Bank design combines the spirit of a credit union with the power and growth potential of a stock savings bank.
Any geographic community can have its own democratically-guided virtual bank, simply as a cooperative depositor group within Common Good Bank. Deposits, investments, and profits will be tracked separately for each community. All profits from the community’s investments will go to schools and other nonprofits as decided by the members.
This is a solution that we can do NOW without having to convince our stubborn national government and all the powerful bank corporations to start doing the right thing. All we have to do is get several thousand people to buy in, to start our own bank for the common good.
Damon Vrabel is still trying to educate people. Gerald Celente at his site suggests “breaking the chains” (meaning buy local). David DeGraw suggests the “99%” solution where the majority of people rise up and take back the country from the 1% who have enslaved it. Alex Jones has some suggestions, but like DeGraw , not specific details. Max Keiser of course suggests bringing down some of the big corporations, like with his “everybody buy a silver coin and bring Morgan down”, or boycott Coca Cola. The thought being that would force the Elite to the negotiating table, because they would be getting hit in wallet. The problem as I see with ALL these suggestions is that the Oligarchy does not NEED us anymore. They can ignore everything we think and do because they already OWN just about everything. And by the way most of the analysts are saying we are heading towards WW3 next year or after. And that will really be a sea change in what to do. Ask yourself this. With unemployment checks and extensions being planned to discontinue at the end of this year, with more people than ever being thrown out of their homes, with food stamps for 40 million Americans being the ONLY thing between them and starvation, is there any time left to actually DO something about the problems? If one does not have gold and precious metals yet, and a food depot to last at least a year, and a position to defend their families against a rampant crime wave, how do they think they are going to survive what is coming? Much less talk (more talk!) about what to do?
Might I suggest that you get to know your neighbors well? And if you don’t like your neighbors now, maybe you could move somewhere that you will like your neighbors, and do it as soon as possible?
Why does this author focus on the failure after the 1972 change without mentioning what ultimately led to the 1972 predicament: the 1913 Federal Reserve Act?
Because people already know about that; what they don’t appear to understand is the true nature of the changes that have taken place – on an escalating schedule – since 1972, or maybe 1971, when the Inter-Alpha Group was founded.
Jesse Ventura is doing an interesting expose on TruTV of Bilderburg, the FED, and the evil doings of the Global Aristocracy. I think the show would be even scarier with some of Damon’s insights into the immediacy of the threat we’re facing and degree to which we’ve already lost our humanity: the psychological aspects. On the other hand, Jesse makes the consequences of economic corruption “accessible” to dummies such as myself. Perhaps, with a little schooling on the intricacies of economic slavery, he could be beneficial to the cause of universal enlightenment. (?) He certainly has a larger audience than we; with mass-media appeal. (You know we’re going to need car chases and fire-balls to get John Q’s attention!) Just a thought…………………………………………
I’ll try to contact Jesse V. by e-mail and alert him to the existence of http://www.csper.org and suggest an interview…………..or has this already been done (?)
of course all that assumes we want any monetary system at all in the future…I just want to leave open the possibility that perhaps we could pull off an entirely new system without money
A system without money? A sane system with money would use money only as tokens to represent the exchange of labor for purchasing power. People might want to keep the net tokens under their sole control, that would mean physical possession, or at least have a secure record of tokens accumulated. Credit records for future activities might also be secured at local utility banking centers. I suppose it might be possible to have a system without money, but it would involve a level of trust that simply does not exist today. In any event to get from here to there we need mark to market debt exposure, all insolvent financial institutions placed into receivership, debt jubilee for all derivatives and other contracts either too complex to resolve, or fraudulent in any shape or form. Then a return to a monetary standard, for example gold, re-valued to allow settling of all debt obligations. Some economists have said maybe $20,000 per ounce would be satisfactory. Then separation of the financial sector into finance, and utility banking. Finance would not use “money” but contracts, and conversion to money would only take place after the contract is settled. “Money” would not be a commodity, and not used for gambling by financial institutions.
Also, everybody who works in finance, as opposed to the “real” economy, would receive competitive exchange of their labor for tokens representing purchasing power, just like in the economy.
That means no more million dollar bonus for what is essentially computer programming. Too big to fail needs to be viewed as too big to continue. And finally, to instill trust again that government and politicians are no longer working for an oligarchy, but represent the people, we need to see LOTS of “financial terrorists” go to prison for a very long time. Maybe, after all those things happen, some system can be formed that does not use money. But used properly, money simply represents the exchange of labor contributing to society, for purchasing power in society. (Once upon a time, if you had your own family farm, and were otherwise independent, you did not need much at all from society).
Assume you get the money system of your choice, whether sound money, free banking, sovereign money, or (your preference here). M0 and M1 are now “officially” stable.
What about other money aggregates like M2 and M3? How does your money system account for those?
What about the secondary equity and bond markets? And the tertiary “derivatives” market?
What do you do about stock option grants and restricted stock grants, which essentially print money from thin air at the whim of a corporate executive? Remember, the price of a stock today is not what it is actually worth if the company were liquidated and proceeds of the sale were distributed, it is determined by guessing at the future performance of the company, which almost always assumes future growth at a rate that exceeds inflation. Essentially, stock price is determined by assuming that the company is actually a financial instrument that compounds interest in perpetuity. How are the grants of stock and options to employees/executives any different than fractional reserve lending in terms of practical effect?
And what do you do about the overall financialization of the real economy, which tasks business managers to run their business to grow forever, which is actually impossible?
“M0 and M1 are now “officially” stable.”
What a relief!!!
“What about other money aggregates like M2 and M3? How does your money system account for those?”
The same as it does now.
“What about the secondary equity and bond markets? And the tertiary “derivatives” market?”
If they don’t serve the Common Good, then their charters should forbid banks from engaging in them.
“What do you do about stock option grants and restricted stock grants, which essentially print money from thin air at the whim of a corporate executive?”
If they don’t serve the Common Good, corporate charters should forbid their issuance.
“Remember, the price of a stock today is not what it is actually worth if the company were liquidated and proceeds of the sale were distributed, it is determined by guessing at the future performance of the company, which almost always assumes future growth at a rate that exceeds inflation.”
That’s the risk you take when you gamble.
“Essentially, stock price is determined by assuming that the company is actually a financial instrument that compounds interest in perpetuity.”
That statement needs explanation.
“How are the grants of stock and options to employees/executives any different than fractional reserve lending in terms of practical effect?”
Fractional reserve lending involves money, stocks aren’t money. I don’t understand the question.
“And what do you do about the overall financialization of the real economy, which tasks business managers to run their business to grow forever, which is actually impossible?”
The “real” economy can and should, theoretically, grow forever; but corporate charters should be written to restrict a corporation’s size to that which best serves the Common Good by fulfilling a specific need. The corporate managers’ task is to manage that. Entrepreneurs, on the other hand, are free to grow as much as the market will bear. You’ll say: “But it’s not fair to corporations.” I say: “Who cares? They’re abstract entities. Screw ‘em!”
Life isn’t a board game. The rules of “Monopoly” don’t apply. Money should represent anything of universally agreeable value that we use as a convenient medium of exchange. Period! Usury through obfuscation is morally fraudulent and would be considered unlawful by an informed citizenry.
m2 and m3 are mostly non-existent as fractional-reserve banking is made illegal, or law is imposed which makes it illegal to use another’s debt to you as collateral. I think in general the world needs to be greatly simplified, which might mean no stock issuance at all, and ownership of companies can only be transferred, bought or sold through partnership arrangements and other individualized ownership arrangements. This would temper the modern bias towards bigness (bigmess?).
Ideally there would be something comparable to a judge or tribunal which watches for unnatural accumulations of wealth, market manipulations, and other possible economic cancers, and cuts the weeds out of the garden as quickly as possible. I’d prefer this solution to just making a hard and fast set of laws because it values continued vigilance instead of contentedness, and has the potential to thwart all problems as long as time is taken to understand economic processes and people look ahead in their analysis and actions. Such a tribunal could effect the long-term adjustments of which our current democracy seems incapable.
Ideally the judges/guardians, the nation and its economy, and the parasites who would feed on them, relate to one another the same way a gardener, his garden, and the insects and weeds all relate to one another.
Tao, you’ve asked a mighty question. What it illustrates is how deep reform must go; ie, it’s not enough simply to devise a new money.
While I do not have an answer for you as I sit here, I would point out that, before Standard Oil (oh, the damage that family has done) and the concept of infinite corporate lifespan (John D. bought the Delaware state legislature, if I recall), companies had to renew their charter at their respective state legislatures every 25 to 50 years. They underwent a process to certify the worthiness, soundness and need of the business they were engaged in and how they did it. Renewal wasn’t automatic and it wasn’t forever.
Now this is good and bad, of course. In the current era, most of us shudder at the thought of the immense graft this generation of legislative bottom-feeders and elected/appointed malignant narcissists could wring out of such a process. On the other hand, it’s my observation, and I would be happy to be corrected, that a corporation of infinite life whose sole objective is unending growth is a description, at the cellular level, of Cancer. At the human level, it’s a sociopath. Such an organization, and again I would be happy to be wrong, must develop a predatory relationship with the people of the society acting as its host, must focus it resources on avoiding by whatever means possible any limits or restrictions placed upon it, and head-off any future attempts to do so (regulatory capture). I am certain that a true history of International and American fin-corps in our era will demonstrate precisely how this was done. Step-by-step over decades. Likewise American agri-business, insurance and real estate–Eric Janssen’s FIRE economy.
This is a website and blog of big ideas, a rare thing. Money is the point of the wedge of the sort of renewal and reinvention that must happen, I’m afraid. So, Tao: excellent question.
JackKnife, while reading your post, I was reminded that what needs to be reformed is human nature. Game theory explains that as long as there are advantages to breaking the rules, rules will be broken. As individuals and groups accumulate advantages, they increase their ‘fitness’ from a Darwinian perspective. Given time and opportunity, the aggressive dominate.
Many have commented along similar lines:
“The condition upon which God hath given liberty to man is eternal vigilance; which condition if he break, servitude is at once the consequence of his crime and the punishment of his guilt.” — John Philpot Curran 1790.
“Eternal vigilance is the price of liberty” – Wendell Phillips 1852
“The only thing necessary for the triumph of evil is for good men to do nothing.” – Edmund Burke
One of the issues that works against us is population density (scale). When a group of 10 people are involved, everyone can keep an eye on each other. When millions are involved it seems inevitable that one group or another will dominate the masses.
“When a group of 10 people are involved, everyone can keep an eye on each other. When millions are involved it seems inevitable that one group or another will dominate the masses.”
That’s because corporations enjoy a higher lawyer:crook ratio than the masses’ prosecutor:citizen ratio. If one out of ten citizens were tasked to keep an eye on corporate behavior they wouldn’t be dominating the masses. It wouldn’t hurt to outlaw usury and deny personhood, either.
Isn’t civilization the process whereby societies deny time and opportunity to aggressive predators? If everybody shrugged their shoulders in the face of human nature we’d still be swinging from tree to tree eating bananas. I say we storm the Bastille!!!
Rick: Fair enough.
But too many of those quotations sound like condemnations of our sleeping masses, those being violated as they slumber.
The best way into my observation is to take the excellent Burke quotation, (paraphrase) “The only way for evil to win is for good folks to do nothing,” and to realize those violating the world population looked at it before you and I did, saw the truth in it, and said, “Gentlemen, Burke is right. Therefore it is incumbent upon us to figure out a way to make the world population do nothing.” AND THEN THEY DID!
It is emphatically not a case of fully enfranchised, fully awake humans the world over sitting on their hands in the face of a demonstrable evil they have not the courage to confront. Alex Jones’s greatest, most insightful observation is to name his enterprise InfoWar. Those millions if not billions of world citizens have been receiving carefully edited information, information edited to a determined goal; not in their interests nor in the nonpersonal interest of discovering capital-T Truth. You and I and Damon and the folks on this string understand that–and even our getting it expands daily as new things are revealed, or as we see through another facet of the Illusion. So as NOT to judge ourselves too harshly or our sleeping neighbors, we would all do well to recall our benighted state of mind the day before we realized there was an alternative to debt money, or the day before we read a “food safety” bill pending, or any of a hundred crimes and enslaving initiatives to which we are now vigilantly opposed. Was it a case of cowardice, or stupdity, that we were the way we were that day before?
Human nature needn’t be reformed so much as no longer constrained and channeled and narcotized, that it can become free and empowered to act according to the full humanity the violators have gone to such great pains to shrink, like little Bonsai trees. They exerted themselves massively and taken great risks over centuries to do what they’ve done, to make the average human appear and act as he does. Let us give credit where credit is due. The human condition is an enormity here on Earth right now. But every day more wake up. While Vrabel’s blog is mainly economic right now, the event of waking is best discussed, I think, in the other two branches of the his council on renewal, the spiritual and psychological ones.
With all that said, I value your comment, Rick, and the quotes you cited. Being awake you and I have to aspire to the standard they establish. Others, as best they can, to the degree they can, as they awaken.
At any one time in the history of humanity it has only been a tiny minority of people who have been to any degree awake. And in most cases the vast majority of folks have preferred it that way. A convenient lie is often preferrable to an inconvenient truth. You must have noticed how people resist hearing what they don’t want to hear. And how often have you heard it said that curiosity killed the cat?
Hitler very astutely pointed out in his book “Mein Kamph” that the bigger the lie is, the more indisposed people are to not believe it. I recently saw a great example of this in a European talk show video on Youtube. Film director David Lynch was shown videos of World Trade Center Building #7, which had not been struck by a plane, collapsing at freefall speed while various engineers pointed out that it would be impossible for such a collapse to be the result of anything but a controlled demolition. When asked for a reaction Lynch simply said it was too big to contemplate. He just wasn’t going to go there.
I have friends who are well educated and involved in the worlds of finance and business, but when I try to discuss our current monetary system with them they just tune it out. They’re not going there. It’s just too inconvenient. They in no way want to entertain ideas that might put them at odds with the system that they are part of and serve.
It seems to me that only seekers find truth, and that those who are seekers are those who have resisted becoming entangled with the world in such a way that would make the recognition of truth problematical when it presented itself.
At this point in time I find it difficult to believe that anything but a small minority of people will approach wakefulness. The majority have always seemed to prefer the world of ego and illusion. Each of us must pursue his own enlightenment and be satisfied with that. Yes we can be of help to others who are truly seeking, but as for those who aren’t, only they can decide whether to seek the light. Maybe after a complete collapse of their worlds people will be more open to other ideas. It is often that enlightenment follows personal calamity. Be that as it may, our enlightenment and action must not be contingent upon the actions or enlightenment of others.
And one more thing. Our means must be consistent with our ends. We must not use the same tools of force and fraud as our would-be masters do. If we do, we should certainly not expect a different result. Remember, government, being force, is more prone to enslave than to enlighten.
“Maybe after a complete collapse of their worlds people will be more open to other ideas. It is often that enlightenment follows personal calamity.”
That reminds me of the quote – “[Most] People don’t change when see the light. They change when they feel the heat!”
Having studied the “psychology of change” and implemented mitigation methods during various projects to alleviate its symptoms, which map closely to the Kubler-Ross model of grief/loss, I can tell you we’re screwed here in the U.S. Or, put less bluntly, we’re going to feel the heat and possibly a “Dark Age” before coming out of this as a nation (or fractured nation.)
Americans, in general and in comparison to other ppl from less wealthy countries, are either a) too busy reacting to their harried lifestyles (kids/chasing the Joneses), b) don’t have the capabilities/education/practice to smoothly adapt to change or c) just don’t care (sloth/narcissism). I’m continually blown away project after project, industry after industry, young and old at the lack of adaptability, willingness for self-introspection and overall courage to look in the mirror.
Some of my professional counselling friends tell me we’re in the middle of an addiction epidemic (drugs, ego, sex, excessive stimuli, etc) stemmed from a leadership and emotional intelligence deficiency. What’s worse is people are going through these daily self-inflicted traumas WITHOUT knowing they’re in trouble (lying to themselves) or seeking any help. They tell me, “People think just b/c you earn a paycheck that you’re all right. The bigger the paycheck, the more all right you must be.” Ugh.
Until people start feeling it in their wallets BIG TIME, then we won’t see real change. Our goals here should be modest – awareness, awareness, awareness.
Very insightful comment. I’d argue that the real problem is that our social institutions are all designed to divide and conquer, to atomize us all into indiviudal, sociopathic consumers who are easily controlled and manipulated, who don’t know how to trust one another or even think about joining in asserting a common cause (or, if we do, the common cause gets hijacked, a la the Tea Party).
Also, I’d argue that we’re already in a “Dark Age” of sorts, courtesy of my favorite bogeyman, neoliberalism. Michael Hudson observes something similar here (Neoliberalism and the Counter-Enlightenment):
Krugman has commented on what he sees as a “Great Forgetting” in the economics field (I agree with the observation, not his recommendation for addressing it), and I’m seeing one in the field of the law, as well. Everything that the Enlightenment brought western civilization is being systematically dismantled. The only question is, when things get bad enough that everybody wakes up to the world as it really is, will they fight back to regain what they’ve already lost, or will they finish the job of destroying what’s left of what the Enlightenment brought them?
I’ll keep an open mind and read that 34 page social democratic rant. I do agree that economic systems dictate most people’s behavior. Incentives matter.
Another simple argument I’ve heard is this is the natural progression of empires where the monopolists and their govt shills anesthetize the people with luxury, entitlements and frivolous distractions to the point of collapse. Sort of like many 2nd generation children of wealthy parents.
Sidenote – does it ever bother you that all your favorite economists consistently do poorly at economics, e.g. predicting future trends? Granted, Kruggie did call for the creation another bubble in housing to offset the one just burst in tech. That was an accurate call:-)
If I have “favorite economists,” they would be Steve Keen and Michael Hudson. Steve Keen actually called the current financial crisis and has been recognized for doing so. Hudson actually did, too (see link below to a 2006 article in Harper’s entitled “The New Road to Serfdom: An Illustrated Guide to the Coming Real Estate Collapse). I view Hudson as a great economic historian, so if you can look past his social democratic leanings, I think you’ll find something of value there. (Hudson’s latest post includes some Krugman-bashing, and rightly so.)
Krugman is somebody that I consider a willing accomplice of the Washington Consensus, and I think his solutions (e.g., QE2) for the current economic situation are wrong-headed. That being said, he strikes me more as a pointy-headed academic than a bought-and-paid for shill like Brad Delong (D) or Greg Mankiw (R). I had more respect for him before he started carrying water for Obama during the “healthcare reform” debate and the financial “reform” debate, but I still read his blog (not his op-ed pieces), only with a healthy dose of kosher salt.
Basically, I’m willing to read/hear what any independent thinker has to write/say about our current socio-economic situation unless and until I have reason to believe that they’re bought and paid for.
(FYI – it looks like the article is now behind a pay wall, but I grabbed it before they did that. If I can find it, I can email it to you. I can be reached at taojonesing at gmail).
You mentioned in your reply to Ranallo that Michael Hudson and Steve Keen both divined our recent mortgage inspired financial debacle. I find it very germane to the discussion of the general dearth of economic enlightenment that so few saw what was so obvious.
After all, anyone who had sat through Economics 101 should have known that you could not have double-digit price rises in the median price of homes while median income remained flat. The fundamental law of price is the law of supply and demand. The only way that prices can rise is as a result of increased demand, barring a shortage of supply. Now it should be obvious to any college freshman who has taken an introductory course in economics, in this situation, that there was no real viable demand fueling the rapid rise in home prices.
One needn’t know anything about the actual mechanics of liars loans, bundled securities, credit default swaps, or any of the other financial machinations in play to see that the housing bubble was just that, a bubble driven by hot air of some kind. And since all hot-air bubbles must fall at some point, the denouement should have been clearly predicted by any freshman who had stayed awake during that introductory economics class.
So the relevant question is why did so many ‘experts’ sporting the letters ‘PhD’ after their names fail to make the call? It seems that an understanding of this phenomenon would be somewhat illuminating.
So many PhD economists got it wrong because they were paid to get it wrong. The PhD economists who got it right– people like Nouriel Roubini, Steve Keen and Dean Baker– were ridiculed and marginalized by their peers.
The better question is why is it that the PhD economists who got it right offer no real solutions? In the MK interview, Damon rightly notes that Steve Keen fully understands debt-money but offers no alternatives, only ways to control the potential damage.
I think the reason is that economists, particularly mainstream economists at the top of the orthodoxy, know that they will lose their livelihoods and, ultimately, be “disappeared” from history.
I know of two economists who have been disappeared from history, albeit in very different ways.
First, there’s Henry George, whose observations regarding land rents and speculation led to the reformation of classical economics into neoclassical economics. Before NCE, economics were understood as the interaction between capital, labor and rent. NCE eliminated rent from the discussion, and thus George’s criticisms were mooted. See this interesting discussion of the history. The thumbnail discussions of the early neoclassical economists are fascinating (especially that of Pareto about 8 pages in):
Keynes is the second economist that has been “disappeared,” primarily through the bait-and-switch tactic of applying his name to something that only partly resembles his recommendations (the so-called neoclassical Keynesian “synthesis”). In the last few years, we’ve had a lot of people asserting that the financial crisis proves the failure of “Keynesianism,” but the fact is that our economic policy has been Chicago School monetarism for the last thirty years. Bernanke is not a Keynesian but a Friedmaniac. Within a decade, though, everybody will be convinced that Bernanke and Friedman were Keynesians, which is ridiculous, but when you repeat a lie often enough, it becomes the truth.
I don’t know if implementing what Keynes actually suggested really would have resulted in the euthanasia of the rentier class (the class that employs economists), but the rentier class sure went through a whole lot of effort over a long period of time to discredit Keynes. By the time the Chicago School of Ponzinomics is done ravaging our economy, everybody will “know” that it “Keynesianism” was to blame, and Keynes will finally be forgotten.
The bottom line is that any orthodox economist that promotes policies that would eliminate the rentier class will be cast out of the rentier’s Garden, and no heterodox economist who promotes such policies will be allowed in. What Steve Keen doesn’t understand is that even suggesting mechanisms to manage or control boom-bust cycles won’t be tolerated. The rentiers benefit the most during both sides of the cycle, which is why they ultimately want to see a new orthodoxy like the Austrian School, which pretends that such cycles are entirely natural and not manipulated or controlled by anyone.
This last post of yours again leaves me scratching my head. You again fail to mention the many economic thinkers who also predicted the current predicament like: Ron Paul, Thomas Woods, Lew Rockwell, Peter Schiff, I could go on. Yes, they are what you call “Austrians”. And a significant proportion of them, who are like me and view involuntary exchanges as a form of theft, would see your above statement:
“they ultimately want to see a new orthodoxy like the Austrian School, which pretends that such cycles are entirely natural and not manipulated or controlled by anyone.” ..
as a real mystery. Do you actually believe this and/or are you able to put together a rational basis for such a statement? In fact for those of us who are in the free market “government” camp we don’t know whether to laugh at this point or feel embarrassed for you.
Are you even vaguely aware that in a free market for adjudication services, every entity that has obtained wealth through involuntary exchanges will be subject to demands for arbitration/restitution by adjudication entities presenting torts that “they” cannot manipulate away through government pull? Do you actually think “they” want hundreds of thousands of tort claims by the victims of the Federal Reserve beneficiary families, just to cite one small example. No way. “They” would start world war III or start a global pandemic before they would stand around and let that happen. Since your wording and command of other facts is quite articulate, I am being led to conclude that your motives here are somewhat veiled. Please can you enlighten me to the mystery of the rational basis of such a statement above. From where I sit it looks absurd, UNLESS you are being paid to be here. If you were then you would be one of the first to accuse others of being shills here, which I think I noticed you claiming earlier so that is lining up that way too. Its not proof, but it is getting me to wonder. Also your difficult (from my perspective) to defend conclusions from von Mises participation in Mont Pelerin Society again leave me scratching my head.
I think I have been clear in the past about my “solution” to the “problem”, the problem that led most of us to us being here, and the solution being non-monopoly adjudication/enforcement/security services, in short a free market in EVERYTHING, ESPECIALLY and starting with a free market in the things “they” absolutely do NOT want free markets in: as I briefly explained above to cite one small example.
Are you revealing yourself as an advocate of the wielding of the club of (governmental) involuntary exchange upon “them” when history and common sense would lead me to conclude that “they” will be the ones ending up wielding the control of such a club in a new form like they always have? Please, am I getting this wrong? Explain yourself? And also just what is it you are advocating as the “solution” to the “problem”?
The first few paragraphs of Hudson’s May 2006 Harpers article
“Never before have so many Americans gone so deeply into debt so
willingly. Housing prices have swollen to the point that we’ve taken
to calling a mortgage—by far the largest debt most of us will
ever incur—an “investment.” Sure, the thinking goes, $100,000 borrowed
today will cost more than $200,000 to pay back over the next thirty
years, but land, which they are not making any more of, will appreciate
even faster. In the odd logic of the real estate bubble, debt has come
to equal wealth.
And not only wealth but freedom—an even stranger paradox. After all,
debt throughout most of history has been little more than a slight variation
on slavery. Debtors were medieval peons or Indians bonded to Spanish
plantations or the sharecropping children of slaves in the postbellum South.
Few Americans today would volunteer for such an arrangement, and therefore
would-be lords and barons have been forced to develop more sophisticated
enticements.”
And the last few paragraphs of Hudson’s May 2006 Harpers article:
“Free markets are based on choice. But more and more homeowners are
discovering that what they got for their money is fewer and fewer
choices. A real estate boom that began with the promise of “economic
freedom” almost certainly will end with a growing number of workers
locked in to a lifetime of debt service that absorbs every spare penny. Indeed,
a study by The Conference Board found that the proportion of households
with any discretionary income whatsoever had already declined between 1997
and 2002, from 53 percent to 52 percent. Rising interest rates, rising fuel costs,
and declining wages will only tighten the squeeze on debtors.
But homeowners are not the only ones who will pay. The overall economy
likely will shrink as well. That $200 billion that flowed into the “real”
economy in 2004 is already spent, with no future capital gains in the works
to fuel more such easy money. Rising debt-service
payments will further divert income from new consumer
spending. Taken together, these factors will
further shrink the “real” economy, drive down those
already declining real wages, and push our debtridden
economy into Japan-style stagnation or worse.
Then only the debt itself will remain, a bitter
monument to our love of easy freedom.”
Yes, I will agree most everyone you meet will avoid discussing the ramifications of our current “mess” because what are the solutions? I don’t think there are any that continue the status quo so we’re all collectively fine with continued can kicking until the crash.
That’s the $64 trillion dollar question, when and how does it all fall apart? And what happens after the crash? And the answer is: there is no ‘knowable’ answer until after “it” happens.
Sure sound money and a sound economic model are good topics for discussion, but you must have a government that will implement these measures in place first. So what is a good model for a post crash government for the USA (and by proxy the rest of the Western democracies)?
The first argument I’ll guess most reading this would make, is a return the roots of American republicanism as outlined in the U.S.’s constitution. A counter I would make is the founding of the USA was based upon an elitist aristocracy who first wished freedom from their homeland and its major corporation, the British East India Co. to pursue their version of life, liberty, and the pursuit of happiness with those rights of lesser freeman, women, indentured servants, and slaves quite down the list in order of importance. A good read for this argument is here
Myself, I’ll take the 18th century elites over the elites of today if given a choice as I believe the 18th century version had better educations and morals than the current batch, but in the end, their ideals were not that democratic.
If America’s original model is flawed, what about Switzerland’s? After all they formed their confederation in the 13th century; it encompasses different ethnic groups speaking different languages, yet is still running strong today, and defied both Napoleon and Hitler. It’s a direct democratic system where local power trumps central and referendums of the populace have the final word, i.e. the people decide directly, not through representatives. They maintain a large and well trained militia, yet have no designs upon conquest. I think this is the best model for post crash America, but instead of having 50 states, states will need to join up in geographical sectors to limit bureaucracy and the military will need to be disbanded except for homeland defense. I, on the other hand, don’t think a direct democracy will work initially in the USA because the populace is not educated enough for it.
How about Soviet style communism? Take away the individual profit motive and what do you get, “I pretend to work, and you pretend to pay me.” That and the USSR has proved this model unworkable over time.
One last ism is fascism, or technitronic corporatism. I’ll contend we’re currently living in a fascist-lite state, which leads me to believe this is the course TPTB will implement. My guess is the Barack Obama’s election to the US presidency was made to happen to say: “See we elected a black President, and what did he do to fix our mess, nothing.” If this guess is accurate, we’ll next have a woman like Sarah Palin or Hillary Clinton installed in the presidency so “they” can say: “Next we elected a woman and what happened? Collapse.” With the goal of course being to bring in a Hitler-type strong man to implement the police state, until “Big Brother” is segued into “Brave New World.”
Yes, I will agree most everyone you meet will avoid discussing the ramifications of our current “mess” because what are the solutions? I don’t think there are any that continue the status quo so we’re all collectively fine with continued can kicking until the crash.
That’s the $64 trillion dollar question, when and how does it all fall apart? And what happens after the crash? And the answer is: there is no ‘knowable’ answer until after “it” happens.
Sure sound money and a sound economic model are good topics for discussion, but you must have a government that will implement these measures in place first. So what is a good model for a post crash government for the USA (and by proxy the rest of the Western democracies)?
The first argument I’ll guess most reading this would make, is a return the roots of American republicanism as outlined in the U.S.’s constitution. A counter I would make is the founding of the USA was based upon an elitist aristocracy who first wished freedom from their homeland and its major corporation, the British East India Co. to pursue their version of life, liberty, and the pursuit of happiness with those rights of lesser freeman, women, indentured servants, and slaves quite down the list in order of importance. A good read for this argument is here: http://cyberjournal.org/authors/fresia/#toc Myself, I’ll take the 18th century elites over the elites of today if given a choice as I believe the 18th century version had better educations and morals than the current batch, but in the end, their ideals were not that democratic.
If America’s original model is flawed, what about Switzerland’s? After all they formed their confederation in the 13th century; it encompasses different ethnic groups speaking different languages, yet is still running strong today, and defied both Napoleon and Hitler. It’s a direct democratic system where local power trumps central and referendums of the populace have the final word, i.e. the people decide directly, not through representatives. They maintain a large and well trained militia, yet have no designs upon conquest. I think this is the best model for post crash America, but instead of having 50 states, states will need to join up in geographical sectors to limit bureaucracy and the military will need to be disbanded except for homeland defense. I, on the other hand, don’t think a direct democracy will work initially in the USA because the populace is not educated enough for it.
How about Soviet style communism? Take away the individual profit motive and what do you get, “I pretend to work, and you pretend to pay me.” That and the USSR has proved this model unworkable over time.
One last ism is fascism, or technitronic corporatism. I’ll contend we’re currently living in a fascist-lite state, which leads me to believe this is the course TPTB will implement. My guess is the Barack Obama’s election to the US presidency was made to happen to say: “See we elected a black President, and what did he do to fix our mess, nothing.” If this guess is accurate, we’ll next have a woman like Sarah Palin or Hillary Clinton installed in the presidency so “they” can say: “Next we elected a woman and what happened? Collapse.” With the goal of course being to bring in a Hitler-type strong man to implement the police state, until “Big Brother” is segued into “Brave New World.”
I saw the video a couple of days ago. I wish we had politicians like Nigel Farage in the U.S. I’ve seen speeches by him before. The EU is a neoliberal experiment, and it is worthy of the scorn he heaps on it.
Tim; thanks for the video links. I’m a subscriber now and go there daily.
To you, Tao, and the others here who talk in terms of branded schools of economic thought:
I had an hour-long argument with a friend and close associate who is also conversant in the various “schools” of economics regarding the effectiveness of labels in the discussion of issues. In the end, I had to admit their usage was convenient short-hand for complex theoretical positions, but only when the participants were of like mind and agreed on the basic assumptions thereof but provoked senseless arguments when said labels were used to express detailed analysis in a specific context. I don’t pretend to understand the tenets of any “school” but it’s got to be obvious that such branded theories, especially those with capitalized proper names, must have an expiration date. As I learn and evolve my beliefs change (daily lately) and what I thought was true yesterday might be seen as folly today. Can it not be said that these branded theories are perishables, to be discarded after a week or two? The originators of such theories deserve the benefit of further reflection, no?
Given that the economic matrix changes with every new banking regulation, court ruling, and hiccup of the stock market isn’t it reasonable to assume the observer’s perspective would be altered to reflect that change? If so, then no “school” of thought can answer the questions posed by an ever-changing reality in anything but the most generalized of terms. Applying old thoughts to new realities can only result in misunderstanding, leading to argument, leading to demonization, and finally culminating in catastrophic intellectual debate. ;<)
We ended our discussion with agreement that it was permissible to use labels, but only with great caution to avoid generalities in doing so. We're still good friends, though we disagree on many issues. Our viewpoints evolve as we learn from each other. I've never learned as much, or as fast, as I've learned from the geniuses here on this here forum so keep it coming! Make me "get it" ! My mind is an electro-chemical shop-vac for intellectual refuse but the stuff I glean from the filter bag is priceless (small tools, rare screws, etc).
I’ll admit to using the brands as a shorthand way of referring to a the various economic belief system (that’s what any branded school of economics provides, kind of like a religion). This is easy to do because I do not subscribe to any of those schools or belief systems. Why? Because each and every one of them springs from a common ancestor that was not meant to describe how the world and economies actually work but to persuade the masses that what certain people were doing would benefit everyone.
People like Hayek, Mises and Rothbard understood full well that their real function was to persuade people that their belief system was correct, not to accurately describe how the world really works. I’ll give you three examples. First, Hayek said that central planning by a government can never work while “overlooking” the fact that every corporation, some of which are larger than some nations economically, engages in central planning. Second, we have this howler from Mises: bureaucracy can never arise in private enterprise. Oh, really? Third, in a confidential memo to the Volcker Fund (a primary funder of Hayek, Friedman and the neoliberal movement in general) we have Rothbard describing the need to engage in Leninist propaganda tactics to push the neoliberal point of view (which he calls libertarian-individualist).
I have no problem accepting that each of these men believed in what they were selling– which was their common neoliberal belief system– but there can be no doubt that they were salesmen who routinely engaged in puffery if not outright consumer fraud. To them, however, the ends justified the means.
I fully understand that some true believers are indignant that I’d lump in the Austrians with Milton Friedman and the Chicago School of Ponzinomics, but the fact is that these guys were in complete alignment as to their politics (i.e., the desired ends) and disagreed only about certain aspects of economics (i.e., the desired means to that end). And I’d argue that much of the disagreement about the economics was a sham because the Austrians had to know that, politically, the interventionism of the neoclassical-Keynesian synthesis could not be discarded unless and until inteventionism was proven to be a complete and utter failure, which is the job of the Chicago School of Ponzinomics. The fact that these men were aligned politically should make any true believer (from either branded school) question his adopted belief system.
I’ve done it before, but I’ll pinpoint what Austrian true believers need to question the most: (1) the Austrian Business Cycle Theory, and (2) private “free” banking as a solution to business cycles.
Ah Ha! Now I get it ! Those aren’t schools – they’re religions. It all makes sense. Economists then, are in reality, evangelical consumers in sack cloth robes just as comedians are philosophers in sack cloth robes. So, if there’s a Promised Land for consumers, do banksters wear sack cloth robes, or silk suits? We won’t know until we get there, right? OK, I’ll take it on faith.
I too am an economic agnostic but still, I think the first thing we should do in the coming Age of Enlightenment is to round up all the Austrians and question them on the rack to confess their heresy, or be drawn and quartered on Reality TV for all to see. All this divisiveness has to stop or we’ll never be free .<)
Might it not be more profitable just to discuss specific economic ideas and leave off of the use of labels altogether, as labels tend to circumscribe thought and to mean different things to different people? I find that labels distract from the actual examination of ideas and tend to put those who use them into camps who then set about the defending of their ‘schools of thought’ attached to these labels. In that respect the discourse does tend to devolve to the level of religion which is most often about doctrines and prophets, i.e., Von Mises, Keynes, Marx, or whomever. When this happens we get more heat that light.
Having said this, it seems to me that one can find certain truths from a wide variety of sources, including all of those mentioned above, without having to uncritically accept all that is said by any one of them. For example, can we not observe for ourselves that economics has to do with human action, as stated by Von Mises, without elevating him to the status of an infallible authority? And can we not deduce from this realization that all of men’s actions in the economic realm flow from subjective individual judgements? And can we not also see that Marx was correct when he told us that political institutions tend to be molded to serve the interests of the ruling elites? And can we not then deduce from this that government, which is force, will most likely always be the servant of certain elites?
Given these rudiments, can we not then discuss their ramifications, searching for whatever illumination we may find and forget about the labels, personalities, and schools which only seem to lead to dissention and faction? I am personally very anxious to hear the discussion of specific economic ideas in detail, but find a plethora of, what are to me, vague labels and generalizations of no value.
Agreed. Labels just distract especially since we’re all in different professional fields and have different academic knowledge bases. Words are just too relative especially at this level of discussion.
To that end, I’ve been a part of some public/private organizations that have actually achieved sustainable models, didn’t have cost overruns and delivered on their goals without driving their own self interests into perpetuity. So, while “socialism” certainly doesn’t work for large populations where the bureaucrats don’t live with their decisions and receive information quickly enough to adapt to reality, it can have applicability within local settings.
At the same time, I’ve run into natural monopolies in small towns (and cable companies) where public and private merged forming a predatory suction pump of value for its inhabitants. The choice for those ppl was “deal with it” or leave. Granted, I’d argue that it’s the govt’s role to promote freedom by allowing competition…but that’s another debate.
I vote for leaving labels with the pundits and demagogues.
“And can we not also see that Marx was correct when he told us that political institutions tend to be molded to serve the interests of the ruling elites?”
I disagree; most constitutions I’ve read tend to serve the interests of the nation as a whole and even the Russian constitution looks like a recipe for heaven-on-Earth. I believe that politicians break or bend the mold to suit their own interests, but not publicly.
“And can we not then deduce from this that government, which is force, will most likely always be the servant of certain elites?”
Government is government. Force is force. Citizens have individual force in the form of guns. Government has organized force in the form of armies, with more guns. Turnips have force in the form of gravity. Throughout history governments have been overthrown by their citizens so you can’t say that governments have a monopoly on force. Governments often do have a monopoly on ignorance however and turnips are often overturned ;<)
So much for congressional oversight of the Fed. The money power will always subvert any governmental oversight or control of its interests…something to be considered by those of you looking to government solutions.
By the way, they got rid of this pesky congressman in the recent election. It would be interesting to know how the money power was involved. I can’t believe they weren’t.
When I spoke of governments serving elites, I was not speaking of who governments claim to serve or the intentions of some of those who helped to establish them. Your citing of the Russian Revolution and its claimed utopian aims is precisely to my point. Intellectuals and others around the world supported this promise of a workers’ paradise only to be bitterly disillusioned. The rhetoric was beautiful but the reality was a nightmare. This historical example ought to give those entertaining new government schemes at least a moment’s pause.
It was George Washington who told us, “Government is not eloquence or reason, but force. It is a fearful servant and a terrible master.” Like all of our nation’s founders he was well aware of the many tragic lessons of history. That is why the founders tried to limit government to the preservation of liberety. But they also knew, as did Santayana, that those who are ignorant of history are bound to repeat it. Their pescience has certainly been born out.
Having paused for the obligatory moment I feel compelled to re-affirm my belief in our Founders’ vision of government’s proper place in the world of man; greatly favoring the “fearful servant” model. Ever hopeful, I attribute our current trend toward economic slavery to the unforeseen consequences of a commercially-sponsored news media.
Ascribing prescience to wise, but mortal, men goes a step too far in the direction of ancestor worship and my admiration for their wisdom doesn’t stretch to deification.
The fact is – we’re NOT ignorant of history. We DO know better. The failure of unbridled corporatism is self-evident. So let’s fix it ! We’re not powerless. The public IS becoming aware of the growing return to feudalism. The polls show a growing distrust for politicians, bankers, and the commercially-sponsored media while increasingly they go to the internet for the truth. These trends are undeniably pointing to the eventual de-centralization of our most vital institutions. The sheep are getting tired of being pushed toward the cliff if you know what I mean and I think you do. All we need to do is keep doing what we’re doing and follow in the path of our beloved Founders until the Constitution contains words like “Corporation”; “Media”; “Broker/Dealers”; and “Internet” and defines their relationship to the Common Good.
We need to pick the Beast apart one Corporate Charter at a time until it fears us. Let’s start with “personhood”.
I exploded and cleaned up a copy of the Federal Reserve System flow chart last year for instructional purposes and uploaded it to PhotoBucket for anyone who could use it:
I don’t know how accurate it is but it’s posted on Wikipedia in thumbnail size – my eyes weren’t so good at the time. Can anyone point precisely to the dysfunctional block or broken link causing the entire system to go so horribly wrong?
The first recorded instance of paper fiat money appears in Marco Polo’s writings of his travels in Asia in the 13th century. He records how the Great Kahn of China, by creating paper money and declaring it legal tender by fiat (fiat money), transferred the bulk of all real wealth, including precious metals and jewels, into his own possession. Polo describes the Kahn as living in unparalleled wealth and splendour. From that time to the present fiat money has been used, without exception, to transfer real wealth from the creators of that wealth (the people) to the creators of the intrinsically worthless fiat money.
The problem does not lie in one of the blocks of your Federal Reserve chart. The Fed is just the window dressing supplied by the creators of the Fed (banksters) to give their counterfeiting scheme an aura of legitimacy. All of the operatives shown on the chart are appointed either by bankers or by politicians whom they control.
They, the banksters, have known for centuries that if you control the money you control the government, and have said so. This is why the authors of the U. S. Constitution wrote into that document that only gold and silver be made legal tender in all of the United States. That should solve the problem, right? But then we see that although that Constitutional provision still stands, fiat money, in all of its modern incarnations, has become the exclusive legal tender in all of this land. And we also see that all of our elected ‘servants’ put their hands on a Bible and swear to defend and protect the Constitution of the United States. Well, it appears that not even the highest law of the land can contain the banksters and all of those bought by their ‘money’ and ‘credit’, and they are many. And as for ‘the people’ my experience has been that far too many are about as informed as those you see on Jay Leno’s “Jay Waliking” segments.
I find it incredulous that there are still people with any grasp of history advocating various fiat money schemes thinking that it will be different because they and their friends are advocating this new and improved monopoly money. I can only quote Albert Einstein here: “Insanity consists of trying the same thing over and over again and expecting a different result”.
Forget the chart. It’s totally bogus from top to bottom and only intended as a visual aid for elementary school use anyway ( instilling the myth early-on). My object was to compose a reality-based update but plainly, that’s not going to happen. Thanks for the history lesson – I missed fifth grade and appreciate your filling me in.
Your point is far more interesting. Assuming as you infer, that fiat money is the Devil’s trident, what is the enlightened alternative? …………Tally sticks? Pigs? Gold? Wives?
You seem to fear the evils of banking yet apparently have no respect for governments’ ability to regulate them. I have to ask: ……..“Are we simply doomed, no matter what we do?”
Do you have any suggestions for a plan that satisfies our basic economic needs for an equitable system of trade, or are we condemned to an eternity of economic slavery? Is slavery the natural plight of mankind? If the answer is “Yes” then why are you here? If the answer is “No” you must have a solution and I for one am dying to hear it; preferably in your own words. The dead thinkers you usually quote weren’t facing foreclosure and their advice loses relevance in the present context.
Let me just quote a couple more dead thinkers. I think that James Madison summed up the problem at hand when he said, “The reason men form governments is that men are not angels. The problem is that governments are made up of men”. So how do we escape this dilemma?
The second quote is from Thomas Edison. After having tried some several thousand different substances as filaments for his proposed electric lightbulb, Edison was asked, “Aren’t you tired of failing?” Edison replied, “I haven’t failed. I have already discovered many things that will not work.”
History has shown me some of the things that have not worked. I am still seeking answers as to what will work. That is one reason I frequent this blog. But as for trying things that have already been tried and failed, I would just suggest that there is no education in the second kick of a mule.
I knew you couldn’t reply without more historical quotes – so let’s work with that.
You say: “………there is no education in the second kick…..” ; yet the revered T. Edison (RIP) himself said: “I haven’t failed………I have already discovered many things that will not work.” You dare to contradict the Master of Invention? He’s dead – he can’t be wrong.
As for Madison, he was wrong about banking from the git-go and statements such as : “The reason men form governments is that men are not angels. (Duhhhh !) The problem (what problem?) is that governments are made up of men”. Jefferson thought governments should be made of laws. Isn’t that what the Constitution was for? Quote me some more quotes on that one.
“So how do we escape this dilemma?”
What dilemma? More quotes please.
I’d like to pontificate a little on my own here. Criticism comes naturally to human beings. As children incapable of offering a better solution we ridicule every imperfection as a sign we know better than our parents. Growing up, we face a constant uphill struggle against out-dated traditions. As adults, refusing to admit we haven’t solved anything, we continue to criticize, thinking it makes us look smarter. Creating solutions, on the other hand, requires holding out new concepts for public inspection and certain criticism. It’s too risky for the meek, but successful inventors incorporate public criticism into their revised models and eventually produce something equivalent to a functional and affordable “light bulb”. Successful inventors have thick skin and routinely toss off negative feedback but focus their efforts toward overcoming constructive criticism.
This forum could and should become the feedback channel for such constructive feedback. I hereby urge the intellectuals lurking herein to spew forth your wildest dreams and subject yourself to the multitude of nay-sayers in the hopes of lighting even one candle of light. Damon did it on the CSPER home page but all we’re seeing in the blogs is fear and negativity. Lots of smoke but little flame. Where’s the support for Napolitano taking a stand on a MSM news channel to enforce the EXISTING Constitution? Janet Tavikoli made some profound statements indicting Wall Street and the FED on C-SPAN so the problem is being exposed but, so far, no one is proposing corrective alternatives. If we don’t take the lead on leadership in that regard, who will? Looking back is all well and good but it doesn’t guide the future. For that we need action. Action in this context (to me, at least) means reaching some kind of consensus on the issue of a possible and workable monetary system that isn’t privately held and publicizing a workable means to achieve that goal.
The point I was trying to communicate through Edison’s quote and the metaphor of being kicked twice by the same mule was that when a certain strategy is demonstrated to be wanting one must search for alternatives. Isn’t it obvious that when Edison failed at one attempt he examined another rather than repeat the failed one? I am surprised that you haven’t grasped my meaning here. It seems more than obvious.
Now here is another quote you may not like, pertaining to the value of history: “The stupid man refuses to learn from his mistakes, whereas the smart man does. But the wise man learns from the mistakes of others.” It is not necessary to relearn the lessons of history. True progress depends upon our learning from the experiences of those who have gone before us, otherwise we are doomed to constantly repeat the same errors over and over. However, this presupposes that we study and contemplate history.
But that does not mean that we should hold our ancestors in uncritical awe. After nearly a thousand years of languishing in limbo with virtually no progress in the sciences, man began to finally awaken and move ahead again during the Renaissance and the Enlightenment…but not before he was able to evercome a worship of ancient authority.
It was not until these more modern times that folks discovered that flies have six legs. Nobody had ever checked because Aristotle, who was held in such high esteem, had said that flies have four legs. He also said that the Earth was the center of the solar system, that heavier objects fell faster than lighter ones, and many other things that were incorrect. Only when people like Galileo decided to look for themselves were these errors exposed. Yes, Galileo challenged the wisdom of predecessors, but all subsequent scientific progress is indebted to his critical attitude.
The dilemma that Madison brought to our attention was that although man had made great strides in the sciences, his spiritual progress remained problematical. And so how was a government made up of spiritually flawed people supposed to correct the problems of those same spiritually flawed people. To paraphrase another quote: “The flawed shall lead the flawed and they both shall fall in the ditch.”
The relevant question seems to me to be how can we make a moral society out of immoral people. And even more to the point, how can one make anyone moral but oneself? Is not the lesson of history abundantly clear that morality can not be legislated? And is this not the dilemma of which Madison was only too aware?
Hi Damon. At the end of the day, if we do what Ben Still suggests, have the government print the money then we would have the necessary foundation to revolutionize the way we as a free society progress. Without the implementation of interest free currency everything we do is ultimately stunted as those who are in complete control of the money supply can thwart any progress by manipulating our economy with more inflation or contraction and recession. So, shouldnt it be obvious that the first essential step to change things in any meaningful way requires that the population clearly understands that our money system is broken and that all we need to do to fix it is to eliminate the banks from issuing the money and putting that power back into the proper hands of the congress which is clearly defined in the constitution. Lets keep things simple as possible at this point in time and try to dig as deeply into the root as possible on the first dig. People like yourself can show us how to transition ourselves into this “new” way of banking. I do agree with you that any change will need to come from the bottom up and although we are very divided the grassroot issue we can all agree on is that the banking system is broke and needs to fixed. Focusing on how we get our money, where it comes from and who controls it seems to be the best thing we can do first going forward, dont you think?
Remember Damon, most people dont vote, they understand that the game is rigged, the numbers clearly favor us!
Exploring the sarcasm behind the ironic choice of Supreme Court Of The United States as Person Of The Year; ……………….(as if it needed explanation). The Citizens United vs Federal Election Commission decision lays open the bare bones of the 200 year old argument between the advocates of Thomas Jefferson and Alexander Hamilton. Is it judicial activism; a call for legislative action; or tired bureaucrats’ last, dying wish for a benevolent kleptocracy to make their decisions for them?
Few would deny that we’re currently experiencing a Global Financial Crises and most can agree it’s not due to environmental calamity such as flood, drought, locusts, or earthquakes. Economists can’t agree on what exactly DID cause it but it’s commonly agreed that some fundamental changes need to be made or civilization, as we know it, will suffer a complete breakdown. You can blame un-regulated free-market capitalism, over-centralization, global banking cartels, government corruption, financial colonialism, the two-party system, or global warming myths; but those are only symptoms of the basic flaw underlying all sovereign and international economic systems in practice today – the idea that institutions should have rights and privileges above and beyond those of the individuals that comprise it. Banks use this rationale to leverage capital and they call it fractional reserve lending; a prime suspect in our current banking predicament. Governments (such as our own) use this idea to justify their self-serving agendas on the speculative grounds of “public mandate”. International corporations use this idea to justify fraud and usury under the guise of “serving the stockholder”. The idea I’m referring to is the insane, but popular, notion that “associations” are somehow endowed with “personhood” above and beyond the normal personhood bestowed on its individual members.
The incorporation of multiple individuals into a viable legal entity constitutes the creation of a “Fictitious Person” for the purpose of executing legal contracts. Corporations are not really persons, however – they’re a legal fiction. They don’t exist outside the realm of business contracts. The Constitution neither sanctions nor forbids the creation of corporations; therefore “fictitious persons” are exempt from any Constitutional consideration. Being outside the jurisdiction of Constitutional law, corporations are therefore free to grant “themselves” whatever rights and privileges they deem most advantageous (profitable). And they did. And their advantages (money) now exceed those of the federal government itself.
Big corporations have come to love our government so much they decided to buy it. They made our government bigger because corporations thrive on bigness and what organization can better administer the Human Resources and Security divisions of a global banking cartel than the up-and-running sovereign infrastructure of a global sea power.
While amateur economic theoreticians follow the money going forward, let us amateur historians follow the money trail back to the origins of the Corporate Beast; just for fun.
The presumably-liberal opinion of Bob Burnett puts it this way in the Huffington Post: http://www.huffingtonpost.com/bob-burnett/2010-person-of-the-year-t_b_802991.html?utm_source=DailyBrief&utm_campaign=123110&utm_medium=email&utm_content=FeatureTitle&utm_term=Daily+Brief
“In the Citizens United decision Roberts aggressively advanced the conservative agenda along three fronts:
“First, the decision to hear this case was an extraordinary example of judicial activism. Professor Dworkin observed, Citizens United “did not challenge the constitutionality of the Bipartisan Campaign Reform Act.” But the five conservative justices — Chief Justice Roberts, Justices Samuel Alito, Anthony Kennedy, Antonin Scalia, and Clarence Thomas — decided on their own initiative, after a rehearing they themselves called for, that they wanted to declare the act unconstitutional anyway.” [Emphasis added] Justice Kennedy, who wrote the majority opinion, explained that the conservative justices called for the rehearing because they had dissented on the most pertinent precedent, McConnell v. FEC, and had continued to complain about it.
“Second, the Citizens United decision strengthened the conservative contention that corporations have “personhood” and, therefore, enjoy the same rights as ordinary individuals, including the right of free speech. (For a compelling account of how the bizarre notion that corporations enjoy the same constitutional rights as human beings has evolved, see radio host Thom Hartmann’s book, Unequal Protection.)
“Third, the Citizens United decision allowed corporations to spend unlimited funds in political contests. It was this aspect that caused President Obama to observe, during his January 27, 2010, State of the Union Address, “The Supreme Court reversed a century of law that I believe will open the floodgates for special interests — including foreign corporations – -to spend without limit in our elections.” The decision granted corporations more rights than those of human beings.”
- all of which ignores the fact that US citizenship is not required to buy stock in American corporations and foreign corporations can charter banks in the US and sell stock to US investors, simply by filling out the proper paperwork. Multi-national corporations have NO nationality, they’re “citizens of the world” – loyal to nobody but themselves. Any talk of “foreign corporations” is therefore meaningless, because they’re ALL foreign. And contrary to Obama’s observation, SCOTUS only confirmed “a century of law”.(See: Santa Clara County vs Federal Election Commission)
And the presumably-conservative opinion of Bradley Smith in the National Review is:
“The Court held that 2 U.S.C. Section 441a, which prohibits all corporate political spending, is unconstitutional. Foreign nationals, specifically defined to include foreign corporations, are prohibited from making “a contribution or donation of money or other thing of value, or to make an express or implied promise to make a contribution or donation, in connection with a Federal, State or local election” under 2 U.S.C. Section 441e, which was not at issue in the case. Foreign corporations are also prohibited, under 2 U.S.C. 441e, from making any contribution or donation to any committee of any political party, and they prohibited from making any “expenditure, independent expenditure, or disbursement for an electioneering communication.”
- which also ignores the fact that US citizenship is not required to buy stock in American corporations and foreign corporations can charter banks in the US and sell stock to US investors, simply by filling out the proper paperwork. Multi-national corporations have NO nationality, they’re “citizens of the world” – loyal to nobody but themselves. Any talk of “foreign corporations” is still meaningless, because they’re ALL foreign.
The presumably-unbiased Wikipedia presentation of the case;
contains this passage:
“Justice Scalia joined the opinion of the Court, but wrote a separate concurrence, joined by Justice Alito and by Justice Thomas in part. Scalia addressed Justice Stevens’ dissent, specifically with regard to the notion that the court’s decision was not supported by the original understanding of the First Amendment. Scalia stated that Stevens dissent was “in splendid isolation from the text of the First Amendment. It never shows why “the freedom of speech” that was the right of Englishmen did not include the freedom to speak in association with other individuals, including association in the corporate form.” He further considered the dissent’s exploration of the Framers’ views about the “role of corporations in society” to be misleading, and even if valid, irrelevant to the text. Scalia principally argued that the first amendment was written in “terms of speech, not speakers” and that “Its text offers no foothold for excluding any category of speaker”.”
Which, to me, pinpoints EXACTLY the most important, but as-yet unresolved, issue of the “personhood” of the speaker referred to therein. Our Founders, by omission, left “corporate” legal status dangling in the original Constitution. Our Founders presumably kicked the “corporation” can down the road for consideration by later generations because nobody at the time could foresee the consequences of chartering them into existence. In Citizens United, the SCOTUS decision was obviously based on judicial history and legal precedent; – not economic history. That’s SCOTUS’ job and they did as they were instructed to by the Constitution. OUR job is to provide SCOTUS with a Constitutional Amendment clarifying the definition of “person” as a human being, and “corporation” as a legal fiction by which humans can amass inhuman amounts of capital for infrastructure projects as needed for the Common Good. An appropriate Amendment would mandate uniform and transparent accounting principles be applied to any corporate entity acting as a “fictitious persons” with clearly enumerated prohibitions from participation in the affairs of American adults. Corporate charters should be written to specifically define their status as a public utility , limiting their size and scope to satisfy specific areas of endeavor; – not to micro-manage or limit profitability, but to establish limits. (Good bye TBTF.)
Our Founders weren’t dumb. They debated the issue of economic systems furiously in the Federalist Papers but never reached consensus because the status quo at the time, and the outspoken opinion of Alexander Hamilton (whom nobody liked and fortunately was shot in a duel before he could obligate our fledgling Union to any world trade organizations or interplanetary monetary funds) favored the English version of legalized banking usury. Jefferson, always the dedicated Revolutionary in every sense, thought we could do better than that and fought an up-hill intellectual battle with proponents of the deeply-entrenched European economic model (laissez faire, “free-market”; ……you know; the one that survived slave-revolts). After 200 years of our own economic slavery, with intermittent boom/bust Hamiltonian joy-rides, it might be apropos to re-think some of Jefferson’s egalitarian ideas; to whit:
“If the American People ever allow the banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers occupied. The issuing power of money should be taken from the bankers and restored to Congress and the people to whom it belongs. I sincerely believe the banking institutions having the issuing power of money are more dangerous to liberty than standing armies.
“We are completely saddled and bridled, and the bank is so firmly mounted on us that we must go where they ill guide.
“The dominion which the banking institutions have obtained over the minds of our citizens…must be broken, or it will break us.”
“The incorporation of a bank and the powers assumed by legislation doing so have not, in my opinion, been delegated to the United States by the Constitution. They are not among the powers specially enumerated.”
“The Bank of the United States is one of the most deadly hostility existing, against the principles and form of our Constitution. An institution like this, penetrating by its branches every part of the Union, acting by command and in phalanx, may, in a critical moment, upset the government. I deem no government safe which is under the vassalage of any self-constituted authorities, or any other authority than that of the nation, or its regular functionaries. What an obstruction could not this bank of the United States, with all its branch banks, be in time of war! It might dictate to us the peace we should accept, or withdraw its aids. Ought we then to give further growth to an institution so powerful, so hostile?”
and the ever-so-timely:
“Certainly no nation ever before abandoned to the avarice and jugglings of private individuals to regulate according to their own interests, the quantum of circulating medium for the nation — to inflate, by deluges of paper, the nominal prices of property, and then to buy up that property at pennies to the pound, having first withdrawn the floating medium which might endanger a competition in purchase. Yet this is what has been done, and will be done, unless stayed by the protecting hand of the legislature. The evil has been produced by the error of their sanction of this ruinous machinery of banks; and justice, wisdom, duty, all require that they should interpose and arrest it before the schemes of plunder and spoilation desolate the country.” –Thomas Jefferson to William C. Rives in 1819
By way of contrasting opinion, I quote Alexander Hamilton:
“In the general course of human nature, A power over a man’s subsistence amounts to a power over his will.”
“The voice of the people has been said to be the voice of God; and, however generally this maxim has been quoted and believed, it is not true to fact. The people are turbulent and changing, they seldom judge or determine right.”
“A national debt, if it is not excessive, will be to us a national blessing.”
Catherine Austin Fitts summarizes the reality of our economic system better than anyone I’ve heard to date. It’s just one more reason to turn off your TV and tune in to what’s really going on right before your eyes.
The only thing I would add is a follow-up to her observation that corporations now constitute an entirely independent shadow government with financial sovereignty over our “nominal” government:
Corporations that are permitted to write their own Corporate Charters are not going to be nearly as democratic as corporations whose Charters were written by We, The People.
The only way we’ll ever restore trust in government is to pigeonhole all corporate entities doing business in the USA , especially banks, into a conceptual box labeled “Public Utility – for the common good”.
If corporate charters were written by adults (ie: un-sponsored congressmen) we wouldn’t have these self-destructive financial shenanigans going on. Congressionally-authored corporate charters should start with “getting real” about “personhood”.
We desperately need to de-centralize monetary power and get it back in the hands of the VOTER. Regulation doesn’t work. We’ve proven that again and again. We have to define WHAT these corporations ARE. Only then can we regulate them in terms of their desired function in society.
It’s way past time for an Art. 5 Constitutional Convention. Why aren’t we party-ing?
This video certainly lays out the symptoms of our current malaise in admirable detail. But it also reveals the conundrum that I discussed with you some little while back…the one that Madison pointed to as a central dilemma of human society and its governments.
Ms. Fitts points to ‘transparancy’ as a possible solution to the widespread corruption infecting our current society. But just a few minutes earlier she related how, when giving a speech to a group of people whose mission it was to seek spiritual improvement, that she had revealed to them the vast amounts of illicit drug money being laundered through many of our major financial institutions. And when she asked this group if they would put an end to this illegal and socially deleterious activity, if they could, by pushing a button, only one person raised his or her hand. When Ms. Fitts asked the audience why they would choose not to end this criminal activity, they told her they thought ending the money laundering necessary to the drug trade might adversely effect their finances. And this is a group professing to be spiritual seekers.
So here is a dramatic illustration of what I was attempting to convey to you in some of my earlier posts. The transparancy was certainly there in the situation just described, as Ms. Fitts acquainted her audience with the facts of the matter, but virtually all of the seekers of enlightenment in question would choose to ignore illegal and immoral activities if it served their selfish interests.
What good is it to pass new laws and reconfigure the legal landscape when the people themselves would have no compunction about ignoring these arrangements when it suited their selfish interests. Wouldn’t the manipulation of legal externalities simply amount to putting lipstick on a pig? How can we hope to build a moral society made up of immoral citizens? The problem that we face is not a legal one and will not be solved by legal manipulation. It is a moral problem that we face. How do we deal with this reality?
Backatcha Tim:
There are a whole big bunch of possible reasons a bunch of spiritual seekers would condone the laundering of drug money by financial institutions: 1, they’re Libertarians and don’t see it as their “business” to interfere in the folly of druggies, their dealers, or the banks that deal with them; 2, drug use is not a spiritual issue but a health issue, and none of their business; 3, laundering money is a moral issue for the banks only if the banks think drug use is immoral regardless of illegality; 4, they might think drugs are cool – they’re not psychologists, they’re spiritualists; 5, they might think that imposing their beliefs on anyone else by force is, in itself, immoral; 6, they might think their money, however ill-begotten, is better spent by themselves in the promotion of spirituality.
As to how we build a moral society; I don’t know – define morality. I thought the object of the Constitution was to create a FREE society, in which one could pursue life, liberty, etc. so long as it didn’t infringe someone else’s right to the same. I don’t remember the Constitution saying anything about the DEA, or banks’ obligation to question the source of deposits.
The audience in question was probably making a statement about the spiritual immorality of victimless crimes and decided they didn’t want to be financially victimized by government any more than they already were by the IRS.
It is a *moralistic-government* problem that we face; and the solution is to join our spiritual brethren at the Evangelical Church of the Blessed T. Jefferson…………………… ………………………..ya’ll sing along now;
“A wise and frugal government,
which shall leave men free
to regulate their own pursuits
of industry and Improvement,
and shall not take from the mouth of labor
the bread it has earned –
this is the sum of good government. “
Thomas Jefferson
I think that Mr. Jefferson, and all honest people, know that the Constitution and the laws to flow from it presume a moral basis. After all, law presumably flows from a set of values, i.e., a moral code. When the people in question readily admit that their prime consideration for not being concerned about gaining from illicit drug profits is financial self interest, it seems to me more than just a little disingenuous on your part to hang the fig leaf of ‘libertarianism’ over their deeds. After all, it is one thing to let others act self-destructively and entirely another thing to profit by their misfortune.
What is morality? Well, the philosopher Kant defined immorality as treating others as means rather than ends. In other words exploiting others for your own self interest. I think Jefferson, who despised the exploitation of men by their fellow men, would have no problem with Kant’s definition. By your reasoning one should not at all be concerned by the banksters putting so many in debt, as it is not your business if other people want go into debt, or, for that matter remain ignorant of how they are being exploited.
Actually, there are many who use debt knowing full well that it is inflationary and does financial harm to their neighbors. The wealth of savers is confiscated by borrowers and lenders due to our inflationary credit system. But, hey, it’s legal. Why not take advantage of a little leverage. Am I my brother’s keeper? Hell no, I’m a libertarian and that excuses me from any such troublesome notions as morality.
I am sending you a link to a video of a talk given at Yale recently in which the speaker documents the massive cooperation given to the Nazis during WW II by the citizens of various occupied countries. He makes the point that the Nazis had to do very little of the inhumane dirty work in many instances as there were so many locals willing to do it for them in order to personally profit. Perhaps this example speaks more to my point.
Do you really believe that a just society can be constructed by people without moral conviction? And as for what is morality in a positive sense, how about, “Love thy neighbor as thyself”. All great spiritual teachers have professed this principle. It seems abundantly clear to me that only when this principle of brotherly love is put into practice will we achieve the world we long for, and not one second before. Without love all the laws that can be written are in vain. And all talk of reform is just a clanging cymbal.
Tim, Tim, Tim; your nanny-state deviations are killing me.
First of all; the Constitution and the laws to flow from it presume a legal basis, not a moral basis. If the states have a moral basis, that’s their Constitutional right, not the Federal government’s, to enact.
Secondly; one should be VERY concerned by the banksters’ putting so many in debt if they do so by fraudulently misleading consumers to believe values could never decline and interest would remain the same. That’s theft by fraud and deprives the victim of his right to life, liberty, etc. Likewise, drug dealers, by misrepresenting their product, are guilty of fraud and should be prosecuted for that. It is the prosecution of the victims that I find morally objectionable. In the case of Ms Fitts informal poll 99 out of 100 spiritualists agreed they didn’t want to be penalized for the crimes of criminals they never met. I don’t know if the spirituals in question interpreted the red light to mean stopping the initial drug sales, or the stopping of drug money deposits, or stopping the loss to their bank accounts. In any case it’s immaterial to the issue of Constitutionality and why shouldn’t they profit from others’ own self-destruction, so long as they’re not destroying the ignorant bastards themselves?
Thirdly; mortgage lenders and Nazi sympathizers have a lot in common: it’s only a matter of price. I, personally, only worked for a corporation for a short time, in my youth, and have been self-employed or worked for sole proprietors ever since. I regard corporate employment as slavery and refuse to participate. If everybody felt the same we wouldn’t be having this discussion, would we.
Hugo Chavez is busy building a “just” society right now; care to join him? Or would you rather decide what’s “just” for a society?
I’ll settle for a free society. Just throw in a pinch of sanity regarding the status of fictitious persons within it. Free men will find love all around them; slaves can’t respect themselves, much less love another. BTW: I love you. You make me laugh sometimes but you make me think, too.
Don’t you find it just a tad ironic that you would refer to my “nanny state deviations” when the whole thrust of my argument has been against the apotheosis of states and laws and has been directed to the morality of the individuals who create and support these man-made concepts? But, of course, we see here a rather bald example of what students of disputation call the setting up of a ‘straw man’, wherein the person employing said technique substitutes an argument that was never made and thus evades the argument that was made.
Next you tell us that the Constitution, which is a legal document, presumes a legal basis. So you are saying that the basis for law is law itself? The reason that we state laws is that we state laws? The cause of a phenomenon is the phenomenon itself? Really? Does not the concept of a cause or basis presume prior, actuating conditions?
Pardon me for my ignorance, but it has always been my distinct impression that laws, be they those stated in the Ten Commandments of Moses or the Constitution of the United States, are the encoding of certain moral precepts. Many of these precepts can be found in both of the documents just mentioned. Obviously, such proscriptions as “Thou shalt not steal”, “Thou shalt not kill”, and “Thou shalt not bear false witness” are part and parcel to the principles contained in the Constitution which seeks to restrain these immoral encroachments of man upon man and to promote mutual respect…in short, caring for your neighbor as you would for yourself.
The need to provide justification for the legal pronouncements of the Constitution and a basis for it is evidenced by the use of such ideas as ‘self-evident truths’, borrowed by Jefferson from Euclid, and God-given rights, i.e., “endowed by their creator with certain inalienable rights…”, also borrowed by Jefferson – this time from our Judeo-Christian heritage, as opposed to our Greek heritage as in the case of Euclid. The founders, such as Jefferson, were well-read and steeped in these two major cultural streams, the Greek and the Hebrew, flowing into the river of western culture. And they realized that the the Constitution of the government they were about to create must be founded upon accepted moral principles rooted in their shared cultural experience. To simply say that this document we are writing is legal and will be implemented by the force of government, which we are also creating, because we, who are men just like you, say so, would have been slightly lacking in authority and the drafters of the document, being intelligent men, certainly knew this, even if you don’t.
And finally, how am I to understand a man who discounts the idea of morality and at the same time thunders on about the many things he believes should or should not be. Morality and ethics are the fields of thought that deal with the shoulds and oughts or the should-nots and ought-nots in life. And, William, your posts to this blog are all about the shoulds and oughts as you see them. When you rail against theft and fraud and speak about what one should do, as you do in your latest post, you are moralizing, whether you want to admit it or not.
If you are going to reply to me that you are only concerned with what is legal and not what is moral, I must reply to you that most of what Hitler did while in power was done with legal sanction, while most of what the founders of the United States did in overthrowing their own British government was illegal. The founders revolted against the law of their land because they felt the law, as it stood, was immoral and they sought to replace the existing law and government with a new law and government that was, in their eyes, moral. They, like you and I, were moralists. If you have any notions at all as to what might be right or wrong, you are, by definition, a moralist.
I must confess, William, I find it very tedious having to explain to you things that are so basic only to be responded to with the sorts of specious sophistries you have been offering up. You seem to be an intelligent man and this inclines me to believe that perhaps you are being less than candid with me in our discussions. Is it perhaps that winning an argument is more important to you than an open search for truth? Only you can know that. As for me, I must move on, as I have come to see the futility of further dialog between us.
Not to be deterred; there IS a place for morality in society, but not the sort morality that flows down from federal authority but the sort that percolates up from the roots of society. I’m out of my league here engaging in philosophical debate but the mechanic in me finds it impossible to produce a one-size-fits-all model of moral society that lends itself to bureaucratic administration. If the Federal government were to try defining morality in terms of the absolutes you’re referring to, the machinery of government would absolutely lock up.
Just for instance: “Thou shalt not kill.” While it might work for some classes of conscientious objectors, it won’t work if you have a Hitler at the gates. So it would have to be moral for soldiers, but immoral for everyone else. That’s a cheap shot, I know; but I hope you get the idea. It’s just not that simple.
In my original post I was operating in a head-space context of de-centralizing the corporate nature of our entire economy without bombing every damn factory they ever built. Again, I’m trying to construct a new economic system based on the moral value of RESPONSIBILITY. We can’t demand morality from our corporations because, being fictitious persons, they have no more idea what morality is than they know what mortality is. As they currently exist, their only moral obligation is to serve the “stockholder” by making money. To make a corporation act morally would require the government (us) to micro-manage every day-to-day operating decision at every level with prohibitive tons of regulatory rules. So, since fictitious persons have no moral compass, the only practical solution would be to carefully craft a corporate charter with 10, 100, or 1,000 Commandments and “Thou shalt not’s” to substitute for our humanely intuitive sense of right and wrong. Yes ! An entirely artificial, man-made, fictitious morality code written specifically for fictitious persons.
Employees of all corporations would subsequently be obligated by law to observe the provisions of their corporations’ charter. Joe Worker could no longer say “I was only following orders from above.” Management and workers alike would be subject to the same moral code, and that fictitious code would demand no more nor less than that of real citizens. Penalties for fraudulent acts would apply equally and corporate employees could be individually prosecuted as easily as individual con men.
I think the imposition of a fictitious moral code on fictitious persons would do a lot to restore our innate sense of morality and unity as a culture. And again, without throwing out the baby with the bath water.
So yes, I really AM for morality, but it has to be applied sparingly and in the right places. Each application according to the NATURE of the corporation and its function as a public utility.
Sorry I can’t write more plainly, please try to follow the logic and point out ways to say it better without condemning me as as a libertine. I’m only trying to design a workable ECONOMY.
Again, we seem to be talking past one another. You keep talking about ‘governments’ and I keep talking about people. Let me try taking a different tack by simply saying that there is no such thing as a ‘government’. Yes, that’s what I said – there’s no such thing as a government. You say, “Whoa, hold on there. What the hell are you talking about?” And I say, “If there is such a thing as a government, then point to it and show it to me”. You can’t point to anything that is a government. You can point to pieces of paper that men have written words on and called a constitution, you can point to a piece of cloth called a flag, you can point to buildings that men have built and called ‘government buildings’, but you cannot point to a government, because a government is not a thing like a person, but is only an idea within the mind of a person. It is a concept or a myth.
But the tendency is to reify our myths, which is to say we treat them as if they were real things. This phenomenon of treating ideas as if they were real objective things is known to philosophers as the fallacy of ‘reification’. It is the same with corporations, which are even defined as ‘legal fictions’.
So we conjure up these notions such as governments and corporations and then go about treating them as if they were real objective things existing outside of ourselves. Some folks, like patriotic flag-worshippers, even worship these man-made notions. This, of course, is the very definition of idolatry, which is the worship of our own creations.
But the simple truth, William, is that these ideas are simply conjurings of our own imaginations and it is only we, as ‘people’ who think, act, and will. It is utter nonsense to talk about ‘governments’ or ‘corporations’ acting, willing, or being moral. Only we the people can do these things. We simply delude ourselves when we seek to evade personal responsibility by placing that resposibility on an imaginary scapegoat that we call goverment or corporation. It’s a bit like saying, “The devil did it”.
So we create these imaginary entities we call governments and corporations and agree that they should have such powers that we as individuals do not possess, such as using force against our neighbors and evading personal liability, and then pretend to be surprised when various individuals use these powers for their own selfish purposes.
But, to reiterate, there are no such things as governments. Goverments are not things but ideas issuing from the minds of and exploited by people. It’s just us people, William. And that’s why it all boils down to personal morality and responsibility. Governments can’t act morally because they are not willing, acting entities, but simply our own ideas. It is only we, the people, who can act morally or immorally. And I can only decide for myself to act morally. I cannot decide whether or not you or anybody else acts morally. It is folly to imagine that governments can either act morally themselves or cause people to act morally. Only people can act or be at cause. N’est-ce pas?
Possibly more relevant to the debunking of the money is a new term I picked up in The Daily Bell; http://www.thedailybell.com/
refering to the “Anglosphere” in reference to international banking, I assume they’re referring to the central banks of US, Japan, EU, UK, etc. as opposed to the central banks of two BRIC economies, Russia and China, whom recently took steps to divorce themselves from the Anglosphere’s death-spiraling-collapse by bypassing dollars as their own bilateral medium of exchange; thereby hedging against the dollar’s potential defunctability. See: http://www.commodityonline.com/news/China-Russia-trade-agreement-End-of-Dollar-era-34036-3-1.html
This blog has some decent conversations. I’d like to add a few names to to list of people who need our voices and actions of support.
Tom Linzey is an attorney that is involved in some great things. http://activism101.ning.com/profiles/blogs/interview-with-environmental
“Thomas Linzey, the CELDF democracy school organizer who helped the Ecuadorian people write rights for nature into their Constitution and ran the Spokane Community Bill of Rights Ballot Initiative last November has a new book out about the Democracy School process called Be The Change: How to Get What You Want in Your Community. I continue to believe Thomas is one of the most inspirational and potentially powerful community activists in the world.”
Chris Hedges
William K. Black
Lawrence Lessig
George Lakoff
Naomi Klein
Russ Feingold
Bernie Sanders
As you say, “its about power and control.” ThePowersThatBe are not willing to share power with the masses. They ARE willing to spend billions to protect their trillions. They spend billions on the Media Matrix, and billions more on what I would call a counter insurgency effort against anyone who threatens to slow them down.
Max is on to something with AdBusters, but a 1000 fold increase in their activity would be required to make a dent in mass consciousness.
It is nice to talk about how things should be, but how about a road map / action plan for getting there?
in terms of road map, I hope to deliver something, though I doubt it’s going to be what people want to see. my sense is people want a new money plan. there are plenty of those already. I’m in most agreement with Nathan Martin’s Freedom Vision. but the problem is, as you say, the roadmap of how to get there. that’s a Machiavellian chess game against the most powerful interests in the world. that’s the hard part. in fact as I say in this interview, I think it’s impossible without a bottom-up spiritual awakening.
Well, it seems perfectly obvious how to spark a bottom-up spiritual awakening…
First, crank up the AdBuster activity.
Second, write a stirring call to arms that fits on a 3×5 card and
Third, pass it out to all the people living in tent cities in the USA today.
And finally, make a movie starring Keanu Reeves as a long term unemployed AdBuster guy who visits your website and ‘Gets It’.
Feel free to use this as a template.
Mr. Zimmer,
A suggestion to get from here to there. Start at local community level. Opt out of federal system. What happens if a local “community bank” designed as a utility service is formed? It’s purpose to handle interface with the fiat system outside the local community. All settlements are paid in gold (can’t be counterfeited, and retains value). All bank members convert their cash to gold. They all stop paying interest and taxes to the federal system. You say they all go to jail? Maybe. But as the local communities grow in number, going to jail for violating the “legal tender” laws, for not paying “taxes”, for not participating in usury any more, for not helping maintain the fiat power system any more, might be preferable to being killed in violent uprising against the government condoned criminal class.
Starting at the local community level is correct. However, the history of the Liberty Dollar
http://en.wikipedia.org/wiki/Liberty_Dollar
shows that a precious metal based ‘competing currency’ will draw down the weight of the FBI and Secret Service on your head, and they will confiscate your gold as well.
I think a LETS (Local Exchange Trading System) is better
http://www.letslinkuk.net/home/theory.htm
mainly because it does not need any gold or other ‘money’ to get started. All it needs is the local community members who trust each other and have something to offer. (In today’s hyper-specialized world, having something to offer is less likely than in the past but what else can we do?)
In any event, the United Police States of America will make sure your tax burden is paid in full. You can be a debt slave at home, or in prison; enjoy what freedom of choice you have left.
I used to like Jim Kunstler’s rants about how the FedGov will not be able to answer the phones in the near future, much less imprison the uppity. But people like Damon have got me thinking TPTB will find a way.
I’ve discussed things with Kunstler and his mistake is in thinking the fed govt and politicians are in charge. Even if he’s correct that the US govt will break down (I think the fascist stage will come first), you can see how that would play into the hands of the power structure I laid out in lessons 4 and 5.
Mr. Vrabel,
you comment in the lessons there are different factions in the power structure, and neither the FEDs or politicians are in charge. Given that, do you see any possibility of ANY of the power structure factions supporting a “slave” rebellion?
If not, then logically any slaves who do fight back will be killed. Under these conditions, what are the options?
Greetings Damon:
I just discovered your web site and work yesterday through a link via either http://www.brasschecktv.com or http://www.realecontv.com . Both are sites offering alternative (truth) views and should be contacted if you are not already connected with them. Also check out http://www.thedailybell.com for a potential guest editorial or interview.
Your teaching modules, Renaissance 2.0 and Debunking Money, are the most succinct and lucid presentations of the complex global capital system which has enslaved most of the population, and which is the real enemy of those cherishing freedom. I am forwarding your teachings and web site to all my contacts. I agree with you that any true change must originate with each of us at the local and state levels, and that the people of America and the world must awaken spiritually, psycologically and economically NOW! May God guide you, Max and all who choose to open their hearts and minds to enlightenment and freedom.
Damon,
Just passing thru. Good stuff, so far…
I’d like to read what you think about the U.S. petrodollar and it’s, by-force, impact on the empire, world and the coming currency wars.
Also, I’d like to read your opinion of how the empire’s wealth is distributed. If you accept “empire” as a fact, the next question is how its administered. I posit its administration has been to serve the interests of international capital, exclusively. It is this point, I think, which has the most resonance with the average Joe. Like, Rome, it would have fallen in 100 years if the spoils of war were given away to corporations in Gaul but the costs shifted to the Roman treasury.
This seems most apparent to me, others, is easy to teach. Once that lesson is absorbed, I’ve noticed the next about the Fed (or rather the regulation of banks and the top tiers) begin to make more sense.
I get the most head nods when I discuss the use the of the U.S. Military to serve international capital, at the expense of the U.S. Treasury.
Whether war or peace, you can at least administer war (or other distasteful decisions) in the interest of your citizens.
you’re generally correct. we’ve been the muscle for international capital. that served us materially through the 20th century (while destroying the republic in the process), but it’s going to come back to bite us BIG time in the 21st.
Thank u for lesson 6 part 2!
I’ve been saying this for years. BIG/SCALE v. SMALL/EFFECTIVE. I’d love to contribute some anti-trust framework (Teddy R v. silent Holder) into your concepts.
The fascism of size is such a problem.
I’ve also been telling people who like Paul Krugman or Milton Friedman or whatever the case may be, the arguments have been going back and forth for decades with no change, except they all serve the same master.
When I tell people that Paul Krugman fits the NEW YORK times perfectly, they don’t get what I’m saying. They think it’s because I think he’s liberal and the Times is liberal, therefore, that’s obvious. They have no clue I’m speaking on a different level. Krugman serves New York banking as much as anyone thru his bigness of debt solutions. Bush serves them when he goes to war. After all, it was the NYTimes that pushed this country from 55% opposed to war to 55% in favor.
Oh, the establishment Damon…. how they all serve the same poisonous master. The silly NYTimes readers who think they’re radical liberals who oppose banks and neocons have no idea they’re in the HEART of both….
you got it! The only success I’ve had in terms of getting some people to see through the left vs. right fog is explaining how Wall St benefits more from welfare than the poor. That intrigues people enough to listen to my explanation. Then it’s a matter of whether they can comprehend it or not. It’s what I explain in lesson 6.2 of Renaissance 2.0 and lesson 3 of Debunking Money…the government has been taken private.
Excerpt from Common Good Bank Project website
http://commongoodbank.com/2010/10/general/create-money-as-debt
“…We CAN create money as debt, but MUST we? Can we also create money some other way? Yes and No. We can lend, spend, reward, or gift money into existence but the creation is always accompanied by a debt.
Money represents the right to goods and services. Those goods and services have to come from somewhere — that is, someone has to provide them. Therefore money also represents an obligation to deliver goods and services. Who is obligated to deliver those goods and services varies.
If I as an individual issue money, who will deliver the value that it represents? I must not obligate someone else to deliver that value — that would be a kind of theft or fraud. Likewise, I must not obligate myself beyond my ability to deliver. That too would be irresponsible. If I issue money, then I must acknowledge (implicitly or explicitly) that *I* am obligated to deliver that much value to society. It is a debt.
Likewise, a community or nation cannot obligate the rest of society to deliver goods and services. A community or nation can create money responsibly only by obligating ITSELF to create the value that the money represents. Even if we as a society create money, for example, as a reward to an individual for work they have already done or as a grant to a nonprofit, the money is a promise that the rest of society will provide that much value (goods and services) to the individual or organization, on demand. It is a debt.
Money is a promise of goods and services. Money is always debt, by its very nature. We MUST create money as debt — and only as our own debt to society. Anything else is irresponsible.”
Thoughts?
If some sort of money system is used as an exchange for goods and services in order to live your life, whether it is paper currency, gold, silver, whatever, then money will always be the problem. It will end up with someone controlling the money supply and will end up in the concentrated hands of a very few. Money is the ultimate control over human life. I Used to think that if you work hard, you will be rewarded, but that is no longer the case. My eyes opened once I read the book, “creature from Jeckyll Island” by G. Edward Griffin. He does a good job of explaining the Federal Reserve and exposes what it is. Once you understand the Fed, then you can have a much better understanding of what Damon is trying to explain in his video series. I have given this much thought. He is correct in saying that we need a human awakening to what is happening to us ALL. They built up an incredible matrix where people live in servitude to the masters and have conditioned the mind to learn to love being a slave. You cannot escape the matrix until you realize what has happened to you as a human being. Once enough humans wake up, if ever, then we have a chance at wiping out the evil that enslaves us all. Then we can come to the round table and figure out a system where all human life is valued, live in peace, respect each other as being different, but yet realize that we all come from the same strand of DNA and we all contribute something to our survival on this planet.
However, I am very aware that this is wishful thinking on my behalf and will never happen. Truly, evil rules on this planet. For now, we need an army of people waking up by spreading the truth and exposing the elitists agenda for all human modern day slavery. You can take some control back, don’t buy cheap shit from the likes of Wal-Mart, don’t feed your body with crappy corporate food and big pharma drugs, and as difficult as it is, don’t buy corporate made shit. Corporate needs large profit margins to expand and exist, so try not to support it. Rather, support local vendors and if you eat out, eat at local restaurants. Barter as many services as you can.
Todd, yes money always has an obligation. The question is who controls and benefits from it, who is it a debt too, and does it have interest attached. As I try to explain in lesson 1, it’s the fact that the debt money system is entirely controlled by a tiny group of private capital holders at the top and an interest-bearing debt to everyone else that is the problem.
But I think we should have an asset component to the monetary system–fiat money issued based on infrastructure projects, i.e. expanding the supply-side of the economy. It would be an asset to the people and therefore an obligation of the government. Getting such money into the system is the only way to start winding down the debt dollars and reduce the pain of the coming austerity since the people have no permanent money.
Damon said: “Getting such money into the system is the only way…”
Whoa now, statements such as these put my hackles up just a tad friend.
“The people I distrust most are those who want to improve our lives but have only one course of action.” Frank Herbert
Asset based, debt based, commodity based. . . Surely you agree that any financial instruments that we use, as long as they have been emancipated from the control matrix (a.k.a. Corporate/State hierarchy marriage) and are directed democratically with equal representation are the ways in which we may “leave the farm.”
This is why I have chosen to represent Common Good Bank. It does not claim that federal reserve notes are the only instruments through which we may conduct business, but simply that they are the most powerful at this time within the USA context. If one or more of our community divisions were to decide that they wanted to issue an asset based community currency then CGB would use every avenue at it’s disposal to properly represent these communities and empower them with the federal reserve notes needed to activate the communities mutual credit capabilities.
Interest bearing debt instruments are not really the problem. The problem is that these instruments are hoarded by the private capital pools. http://commongoodbank.com/2009/10/general/the-evil-interest-fallacy
Forgot to check the notify box
Damon,
I’ve asked this question now 3 times and have yet to get an answer, so I’ll ask again.
Can we put the speculative banks through bankruptcy – NOT to “teach them a lesson” but the write the debt off, so it doesn’t end up having to be paid for BY US – if we bring back Glass-Steagall? Wouldn’t that give us the opportunity to seperate people’s savings (which needs protection) from speculative debt (which needs to be written off)?
I for one am NOT from simply dismantling the society and going “every man for himself”. This is dangerous for all of us, and anyone who thinks they can take on the US military with a few shotguns and a big tub of dried beans needs their head examined.
As far as money is concerned, we can use it as a convenient form of credit, provided that the PHYSICAL PRODUCTIVITY of the society is protected by the vigilance of the people and their representatives. Otherwise, you have monetarism – which allows the few at the top to liquidate the physical economy of all societies while passing out worthless pieces of paper so that people don’t notice they no longer have any factories, infrastructure, or jobs doing anything real until it is too late.
So, please…answer question about Glass-Steagall? It is a good question.
Thank you.
hi Kylie, sorry I’ve missed your previous questions…it has become difficult for me to keep up with the comments on some previous posts. Frankly I need a forum integrated with this blog so we could have better conversations. Unfortunately wordpress doesn’t offer that.
Glass-Steagall is certainly an absolute minimum. However, I’d recommend FAR more in terms of restructuring the financial system. As long as we have a system that’s 100% controlled by private global capital and 100% based on interest-bearing debt to them, it would only be a matter of time before their concentrated power would takeover government again and repeal Glass-Steagall again.
In terms of bankruptcy, I don’t think Glass-Steagall would solve the problem we’re already in. It would have to be a far more powerful general breakup of all large financial institutions into component parts. I think the only way to do it in a way that protects the small guy would be to take them into government receivership, i.e. nationalization, as I think Bill Black has proposed, and then put guys like him in charge of the process (people with NO connection to Wall St who aren’t sucked in by their fratboy schmarm). As long as it stays in the courts hands, the law requires them to serve the big guys and screw the little guy as they writedown debt.
I don’t mean to be negative. I just want to encourage caution regarding the appeal of easy, simple solutions. We’re in an unprecedented problem…we either fully nationalize and restructure the financial system, ala Indira Gandhi, or we’re going into the new global system. It’s that drastic.
Off topic: Over the Peak has managed to set up an interesting forum on WordPress, if you’re interested in investigating something similar. http://overthepeak.com/wordpress/
Thanks, your presentations are immensely informative.
Good find, some interesting off topic discussions have gone private via email. We really need a forum.
a constitutional amendment isn’t out of the question. We’ve have many for far less important and pressing issues. Aim high..
Check out this documentary, “The Secret of Oz” – http://topdocumentaryfilms.com/the-secret-of-oz/
This paints a very solid picture of where we are today monetarily and maps reasonably well with Damon’s videos. They don’t mention the “senior capital pools” but do get the point that all money is debt. Plus they throw in the Wizard of Oz allegory that demonstrates how people have been fighting the banksters forever. Ellen Brown, who posts here occasionally, makes a few appearances.
Their solution is to get rid of the current system with help of the govt then have the govt control money supply by issuing “greenbacks”. If recessions occur in this environment, the govt will inflate money supply. They also talk about how Sweden issued money to community banks who lent it out locally, which decentralized power and made banks act like utilities. The author/producer of this documentary has never heard of Austrian Business Cycle Theory and firmly believes in the Friedman/Schwartz analysis of the Great Depression (like Bernanke), which doesn’t account for the huge inflationary Fed practices before 1929 that blew up the bubble in the first place.
These “greenback” and monetarism solutions bring up questions like:
1. When has any govt ever maintained “rational” spending levels for long periods of time? Monarchs, religious empires, dictators and extreme nationalists always seem to sprout when they have control of the purse strings.
2. What’s wrong with PRICE deflation like the US had in the 1800′s? (Not money supply contraction but price deflation as seen in the technology industry today.)
I get very nervous about putting so much power into the hands of Congress/”the few”, who inevitably use that power for empire building and control. I guess the case could be made for state govt money supply controls and competing currencies, which would provide a check on spending and allow the best run currency to win out over time. This solution would increase the price of transactions possibly but would be outweighed by the savings of less interest payments.
Great work Damon!
I’m a fan of Bill Still’s film.
fyi, what I call “senior capital pools” = what Bill calls “banksters.”
I think sovereign, fiat money (what Bill/Ellen call the greenback system) is a necessary component to a solution but can’t be the only source of money in the system. I like Nathan Martin’s Freedom Vision which has 1) sovereign money as the base, 2) state banking power, and 3) retail banking. (of course all that assumes we want any monetary system at all in the future…I just want to leave open the possibility that perhaps we could pull off an entirely new system without money)
re #1: I think most of those things you mention demonstrating poor money management were in fact funded by private bankers just like our government is today. There is a massive difference between a top-down imperial government accountable to bankers vs. bottom-up commonwealth government accountable to the people. Your concerns about irresponsible government are valid…any realistic fiat money plan would involve strict definitions tying money creation to value creation vs. the random whim of a politician.
re #2: My guess is Bill would be fine with price deflation. He is referring to money supply contraction.
Competing currencies is a bad idea. That would be freedom for the moneyed elite and continued servitude for the masses who would be whipsawed in worse ways than they are today under the regulation of the Fed. “Best currency would win out” is appealing free market language that in reality means “millions of little people would become destitute if they were in the losing currencies.” The people should agree to a commonwealth currency…a people’s currency rather than a few elite currencies fighting for the next monopoly. At this point, who could possibly compete with electronic digits from JPM Chase? That’s quickly becoming the next monopoly currency. Only government reasserting sovereignty will stop that. Unfortunately I think Ron Paul’s ideas for competing currencies are well-intentioned but very ill-advised given the current power structure.
Thank you Damon.
I decided to go hava look at a “One dollar bill”, and yep it’s right there in plain sight. Firstly, it is clearly marked as a “Federal Reserve Note”, not US “money” or “capital”, and it also clearly states that “this note is legal tender for all DEBTS, public and private”.
Also, on the “reverse side” of the note, there is a pyramid, with a great eye at the top with the latin, “Annuit coeptis” literally translated as “He approves (or has approved) [our] undertaking(s)” (wickipedia). Also from wiki: “The Eye over it [the pyramid] and the motto Annuit Cœptis allude to the many signal interpositions of providence in favor of the American cause.” The other motto, “Novus ordo seclorum” , is latin for “New Order of the Ages”. Interestingly, the phrase also appears on the coat of arms of the Yale School of Management, Yale University’s business school.
Thank you, once again,
~PDV
The state as part of any social solution? I don’t believe so. The USA is the worlds best example of a nation that had laws to keep its government small, and now it is the worlds biggest and most well armed state.
How will it look if financial power shifts from private corporations plus the state to just the state?
A government that works in the interests of ordinary people is a contradiction.
That’s my critical stuff. On a positive note, I think we need to get into a state free society based on voluntarism. In terms of currency, I like the idea of the digital coin, where everyone generates their own currency totally free of a monopoly.
Damon,
I really enjoyed the Max interview. I plan on watching the whole series soon. I’m curious about your education, i.e., how you came to these ideas, this understanding regarding money. What have you read that you would recommend?
Hi Doug, I had to deprogram myself from my education and everything I’ve read to see reality. As far as I know, there’s nothing in print that correctly explains it. I erased what I was taught, then started from scratch with an understanding of how money is created, and then everything flows quite naturally from that.
I’m asked this question a lot. It has a subtle, embedded assumption that we can’t perceive reality on our own, that someone must have a source or some referenced “authority” to have a viewpoint. We must overcome that. It’s the way we’ve been enslaved…trained to think that we can’t be firsthand perceivers of reality but must be secondhand receivers of it.
Damon, you make a very good point here. The proverbial powers-that-be do not want the people to think for themselves and come to an understanding of reality on their own. A quick scan of the arrogance of the elite reveals as much. A lot could be said on this topic (scientism, et al.).
You did mention Steve Keen and Michael Hudson and I’ve learned a lot from them as well. Keep up the good work!
@Doug,
Unfortunately, Damon is correct. There is no “authority” that can provide you the answers. Fortunately, what really matters is asking the right questions, and doing so constantly. Reality is not static, but dynamic.
The first step in asking the right questions is recognizing that economics are politics. Nothing more. Nothing less. At the end of the nineteenth century, “political economy” was rebranded as economics to market political falsehoods as scientific facts. These falsehoods benefit the major capital pools Damon describes, to the detriment of everybody else. They learned long ago that you can determine outcomes by defining the rules of the game, and he who owns the gold, makes the rules.
There are three modern economists who make a living off of debunking their profession: Michael Hudson; Steve Keen; and Jamie Galbraith. None of them presents as complete a picture as Damon, but Michael Hudson is the one who comes the closest and does so in layman’s terms. Steve Keen is a total wonk, but that means he provides sources to back up his statements, so you can confirm what he asserts for yourself. Jamie Galbraith is stuck in the left v. right frame and tends to get partisan, but he is insightful.
Other “debunkers” that can help you question conventional wisdom more effectively include Henry George (check out his “Progress and Poverty” at Google Books), Thorstein Verblen, Gunnar Myrdal, John Maynard Keynes (“Keynesianism” doesn’t include much of Keynes’ actual thinking), Hyman Minsky, and John Kenneth Galbraith. George, Verblen, Myrdal and Galbraith are very easy to understand. Keynes and Minsky can be extremely wonky, and Steve Keen actually does a pretty good job of making their work more accessible.
Here’s a link to Michael Hudson’s site (lots of good stuff there):
http://michael-hudson.com/
Here’s a link to Steve Keen’s latest post, which provides lectures from one of the courses he teaches about what’s wrong with mainstream economics (he has an eBook on the topic, as well):
http://www.debtdeflation.com/blogs/2010/11/11/my-lectures-on-behavioural-finance/
@Tao
Written like a true MIT EE grad;-)
Jeez, not one “neoliberal” thinker belongs in your list of people who see monetary and power-structure reality? Not even the guys who predicted the current mess or understand how business cycles are formed? How about Gore Vidal, Martin Van Creveld, Murray Rothbard, John Williams, Schiff, etc.? (I know you and Damon think the Austrians don’t “get it” fully, but they’ve been saying that the real power lies with the money masters like Morgans, Rothchilds, Rockefellers, Warburgs, etc. for many decades. )
Most of those economists/thinkers you mention (JK Galbraith? Really?) favor centralized planning/control to one degree or another and have no problem using force to attain it. Are you a believer in the non-aggression principle? Do you believe that wars end depressions b/c many of the people you mention do believe that? (BTW, I did enjoy that Keen article and will check out his lectures. Great recommendation!)
I guess I’m calling into question your belief in decentralized, community-based systems being the long-term solution. To me, that seems to be over-riding lesson from Damon’s videos along with a change in our philosophies about domination, predator/prey and interdependence.
First, my goal was to point people towards thinkers who question conventional wisdom. Neoliberalism is the current conventional wisdom, and I view the Chicago and Austrian schools as the main peddlers of that wisdom as it was Friedman, Hayek and Mises who architected it.
Second, a lot of neoliberal ideas have been transmitted into right wing groups, which mix and match them to suit their ideology. The John Birch Society, for example, would be blaming the Rockefellers and Rothschilds for all the evils in the world without Austrian School economics. There are certain animosities that run deeper than economics.
Third, I included the disclaimer that none of these people has the answer, but that they ask really good questions (JKG’s “Economics of Innocent Fraud” is a good example of this, and there’s no push for central planning).
“Most of those economists/thinkers you mention (JK Galbraith? Really?) favor centralized planning/control to one degree or another and have no problem using force to attain it. Are you a believer in the non-aggression principle? Do you believe that wars end depressions b/c many of the people you mention do believe that?”
Your questions assume facts not in evidence. While I have no problem believing that one or more of these people has noted a correlation between the end of depressions and the start of wars, that is not the same thing as recommending war as a policy for ending a depression. I can’t imagine JKG doing so. Neither can I imagine Keynes making that kind of policy recommendation.
“I guess I’m calling into question your belief in decentralized, community-based systems being the long-term solution. To me, that seems to be over-riding lesson from Damon’s videos along with a change in our philosophies about domination, predator/prey and interdependence.”
We have a purity test now? Time to start banning books and disappearing people we disagree with?
Again, the goal was to identify people who were particularly good at questioning conventional wisdom. Their answers are besides the point. The reason I could not recommend people like Mises, Hayek, Mises and Rothbard is that they proclaim that they have the answer and all others are wrong: their answer overwhelms their questions.
Another way to come at this is to describe what I’ve encountered while reading pretty much anything written by philosophers and economists. Inevitably, what I see is a two stage process. First, there is the “descriptive” stage in which the thinker describes how they view world as it is. Second, there is the “prescriptive” stage in which the thinker prescribes how the world must change to conform to his utopic vision. Where everybody screws up is in the second stage . . .
My recommendations were based on Doug still being in the “descriptive” stage of his thinking. I did not even think of those people’s prescriptions because I don’t think their descriptions are complete. What I admire is the process they used to arrive at their descriptions, which is much more open-ended. To me, Hayek, Friedman, Mises and Marx are like peas in a pod because once they arrived at their descriptions, their prescriptions became violently dogmatic, leaving no room for disagreement or debate.
Purity test! LOL! Good one.
You’re right about most “schools of thought” thinking they’re the masters. That does get to me. Intellectual bigotry is annoying.
That’s why I’m on the decentralization and non-aggression kick once we move to a different monetary system. Who knows what will work if we allow people to try multiple solutions? Imagine if, somehow, the US could adopt the Swedish notion of “lagom” into our culture on a mass scale. Things would assuredly change for the better.
Keep up the informative posts.
Hi Tao:
Since you think you got Mises and the “Austrian School” pegged as a contributory root of the evil of Neoliberalism I thought you might enjoy this little nugget from “history” as recounted by Milton Friedman in his recollections of the Mont Pelerin Society meeting in Switzerland in ’47:
“Although all the participants shared the same basic values, they were by no means agreed on how to counter the attack on those values, or on the policies required to implement them. As a result, our sessions were marked by vigorous controversy over such issues as the role of religion and moral values in making possible and preserving a free society; the role of trade unions, and the appropriateness of government action to affect the distribution of income. I particularly recall a discussion of this issue, in the middle of which Ludwig von Mises stood up, announced to the assembly “You’re all a bunch of socialists,” and stomped out of the room, an assembly that contained not a single person who, by even the loosest standards, could be called a socialist.”
Tao, given how you feel about say a Mises or a Rothbard: “that they proclaim that they have the answer and all others are wrong”, do you think it is appropriate or even logical to lump their school of thought into the same boat with Neoliberals like Milton Freedman?
@Sun Shines,
I am well aware of that quote from Friedman. Mises was a famously difficult personality. Friedman was a famously nice guy to be around. That doesn’t mean they didn’t work together towards a common cause. In fact, they did.
Hi Tao:
Impressive response time! For some reason it did not include an answer to my question. I agree about what you say about von Mises personality. However I also think he was a person who would never compromise his principles and was quite outspoken about them. Even though I can agree that his statement here is hyperbolic, I also think he was expressing a grain of truth as he saw.
Freedman goes on to say that he stayed away from the Mount Pelerin meetings for 10 years following this first meeting. Would you say they were “working together” during this time? Please enlighten me.
I will make an observation: an outside observer of this blog might state that I and you are both “working together” at this “organization” (Council on Renewal) at this time as evidenced by our posts. Would it be reasonable to conclude that we are working towards a common cause? Or even more strange, of the same “School of thought”?
Excellent work, Vrabel.
As I listened to your recent videos, the new debunking presentations, a classic reference jumped to my mind, The Company Store. If I may, I recommend you use it instead of “casino” as an image for a predatory scrip-bound scam of value extraction and enslavement.
Here’s what I’m thinking.
The flamboyant Max Keiser started using “casino” to describe our present economy in order to distinguish old-school investing (buying into a business for its supposed inherent, future value as revealed by legit accounting, sober analysis and conservative projections) from the Wall Street scams being perpetrated now, which I won’t even articulate as you and everyone on this string get it too well. So, his term “casino gulag,” while terrific, is going in another direction than you are when you use the term casino. He’s referring to a house of rigged games of chance owned by predators; you’re referring to the chip-exchange aspect of the same place.
I know you know that, but in the recent interview you two used the same word differently, and I want your message to be as clear as possible. Though I love Max, he’s loud; he’s staked his claim to “casino” in a particular usage, and that’s why I’m recommending company store. You have a larger point to make. To put a fine point on it: Going into a casino is not a civil rights issue; it’s a choice. One most people can distance themselves from through high moralism: “Anyone stupid enough to enter a casino deserves what he gets.” That is emphatically not your message.
Being born into the dollar system, and into a burdensome share of the national debt, is much more like living one’s life in closed-system debt bondage the way generations of miners did merely by being born in a particular holler in West Virginia owned by particular coal company that also owned the only source to the basic needs of life, The Company Store. That is a civil rights issue. That’s why the practice was struck down decades ago, as a form of slavery.
The company store, as sung about in the song “Sixteen Tons,” is a peculiarly American enslavement tool, even though the truck system, if I recall correctly, came before. If it can be explained succinctly, contextualized in our own history, The Company Store scam might illuminate for people the system into which they’ve been born. Their dollar earnings were always just the fancy printed toilet paper of a cabal that issued it in exchange for the people’s labor, their life force, their productivity, their creativity, while the cabal bought up the known world with the people’s debt payments to them over the generations.
I don’t believe a fish really understands that it’s been born and lives its whole life in water. It’s just the way it’s always been. Without having lived in a coal holler, or run a nefarious coal company, I’ll bet as little as 32 years, two generations in a land of teenage pregnancy and black lung, is all you need to make The Company Store “the way it’s always been.” Truly, ours is the first American generation in 100 years to have the opportunity to wake up to the perfidy and do something about it.
Look. Your work is excellent. I doubt very much I’ve been helpful, but it’s critical that folks understand with as much clarity as you and your compatriots on this string and elsewhere can bring that they’ve been set up. Debt is a powerful, remote-control enslavement tool in which the debtor punishes himself, relieving the owner class from having to pay slave-drivers with cat-o-nine tails. Those that don’t understand the scam will, by design, service their debts out of crippling personal shame, in isolation. They have to be awakened to the fact that, under a fiat currency system, this was always going to happen: debt interest eventually goes exponential, collapsing the gag, as Mamet might say. We just happen to be the generation it’s happening to.
I hope I haven’t wasted your time.
As Always, My Best To You,
JackKnife.
I think the Company Store accepting only Company Scrip is a great analogy for all the reasons you said. Who cares that the Owners are gambling with their fortunes when you are a wage slave? Their gambling losses are just one more burden to bear.
you’re correct, but I’m not sure most people younger than 50 or 60 would know what a company store is. I’ve never known one.
Right, right. I believe my maternal grandmother is the only person I know who set foot in one. But I wasn’t shooting from the hip either.
Debt Bondage, while precise and exact, is too generic and academic and doesn’t convey a compelling image into which First World humans will let themselves project. Feudalism, also correct, is too Medieval. In conversational English peonage is confined to the Southern Hemisphere aspect. Serfdom means Russia to most folks, with all the weird baggage that goes with it. Yes, those terms are what you’re talking about, but for Anglo-Americans there are psychological barriers of “olden times” and “foreignness” that readers will use to prevent it applying to them, no matter how apt.
My impulse was to look for an image, besides the imperfect casino, that would help modern Americans see that He Who Prints the Money You Are Compelled to Use Owns You–Always Has. And That’s Slavery.
The Company Store is the best I could come up with. If it can be explained succinctly, contextualized in our own history, several of the barriers of denial I mentioned may well fall away. (And the company store served both Coke and Pepsi–oh yeah, gotta give those miners the illusion of “choice.”)
We have to realize that the coming dollar death is an opportunity to reveal the central banking/debt money fraud, and that we’re in a race to reveal it as such before they switch scrips, rearrange the agencies and pronounce things “fixed,” with all the same enslaving mechanisms rebranded and humming along nicely, tuned up for another hundred years.
Dvrabel: Well at least I hope you got around to hearing Tennessee Ernie Ford’s great singing of that song!
Mr. Vrabel, what is wrong with the picture painted in this post?
Working people view money as tokens representing their purchasing power. They are paid the tokens in exchange for their labor. If people are paid a living wage, their purchasing power not lost over time, and given wage increases to cover any increased cost of living, they will be content. If they also have extra tokens they can save for use either to capitalize their own business plans, save for retirement, or spend on leisure activities, they will be even more happy.
The tokens can be added to and withdrawn from the economy, so there are enough tokens to go around, that would be good. Credit can be tokens in advance to capitalize business, or spend for emergencies such as health care, and so on. If people do not have jobs, credit can be issued to insure they can live, until they get jobs. And if the private sector can not supply enough jobs, then projects to improve the standard of living can be initiated by the issuing of credit. And once the business is established any remaining credit tokens can be removed from the economic system. The system described works if the tokens are not counterfeited, and if the supply of products and demand for products, is accounted for in the adding and withdrawing of tokens in the economy, and the adding and withdrawing of credit in the economy, driven by the market. Would it matter in the system described if government or a “bank” is responsible for the issuance of tokens? No, not if the same metric is used to adjust total tokens in circulation, regardless of who adjusts them. Would too many workers and not enough jobs be a problem? Only until new jobs are created, either by the private sector, or the “government”. Such a system would work if “government” purpose was for defense, and maintaining the system to improve the quality of life for all citizens.
Would such a system work? Well, yes. It has worked for thousands of years, up to the present day, every time it has been applied.
Keep the fraud out of the system, prevent criminal racketeering that counterfeits tokens and creates credit in excess of that used to maintain the economy, and the system described can lead to optimum progress to insure an increasing standard of living for every one.
Stop wars of opportunity to steal resources from other countries, stop “government” from perpetuating the mythology that perpetual war creates perpetual peace, and hell on earth created by the criminals will end. And the problem of limited resources? That is a joke. We live in an infinite universe. Time to start mining on other worlds. THAT can be one of the new projects needed to employ some of the people without jobs.
The picture you paint is indeed the way money should work. But the problem with how you frame it is that you mention as sort of simple afterthoughts things like “keep the fraud out,” “prevent criminal racketeering,” “stop wars,” etc. These are the very essence of the problem.
Whoever controls your tokens has the most power in the system, which is the genesis of the fraud, racketeering, wars. So yes it matters greatly whether tokens are issued by a commonwealth type of government vs. an imperial government vs. a few private rich guys, i.e. banks. And history has shown that a commonwealth type government eventually morphs into an imperial government, so even that’s not a guaranteed solution.
The system description I give for local communities needs expansion to explain how the larger corrupting issues, for example fraud, racketeering, wars, can be avoided. To that I reference a Ludwig von Mises article conveniently posted at http://mises.org/MMMP/MMMP6.ASP. Near the end of the article he comments “systematic attempts to regulate purchasing power can only be made through international agreement.” Thus enters the domain of politics, and not purely monetary policy. The system in the thought experiment I outlined previously works because subjective calculation of “purchasing power” is absent. Real world, transparent, economic indicators would be used to compute, objectively, tokens, credit, and velocity, in the economy, with the emphasis on maintaining and improving the standard of living for everyone, and enabling the progress of civilization based on physical economy, for an increasing number of people. Politically this also entails an international non-aggression pack, prohibition of fractional reserve banking, the necessity of holding reserves, prohibition of derivatives, “gambling”, and so on, because ALL these activities render unstable “purchasing power”. Can wars be fought without funding? Can poverty exist if poverty is eliminated by credit issuance to do so? For example credit issued to maintain purchasing power for a project of tearing down the old buildings in cities, and building new buildings and infrastructure. Would we have poor education if government controlled schooling to condition subjects to be work slaves in accordance with the Prussian model (that our schooling system is based on), were eliminated.. specifically because it does NOT improve the quality of life or standard of living of people. Ron Paul is correct that we need to eliminate the federal reserve system, the board of “education”, and all the other societal control institutions and mechanisms put in place to serve the purpose of enabling Oligarchy control.
Hi Robert:
“Real world, transparent, economic indicators would be used to compute, objectively”
Transparent to WHO, and HOW and who gets to compute?
Thankfully most of us today know the unemployment and inflation rate Uncle Sam reports are anything but “transparent”.
Damon,
Thank you for your considered responses. I’ll just drop this statement I’d thought you’d enjoy today by Merkel. While she may have some German self-interest in her position, she has been the only big nation leader who’s even approached heroic or courageous status. I would imagine you could also mix a “spiritual world” interest in this quote in which she distinguishes the financial and political worlds (something that Obama is yet to do)…..
“Let me put it quite simply: in this regard there may be a contradiction between the interests of the financial world and the interests of the political world,” Ms Merkel said. “We cannot keep constantly explaining to our voters and our citizens why the taxpayer should bear the cost of certain risks and not those people who have earned a lot of money from taking those risks.”
Damon has creatively and accurately termed our struggle against debt bondage as a “civil rights” issue and I would add that the international banking cartel is committing crimes against humanity.
I kind of cringed when Max started the interview stating that “fiat” money has never worked and was glad when you astutely corrected him in recognizing the difference between “debt” and “asset” money. Fiat has nothing to do with it and the term simply confuses people as no two people agree on what fiat money actually entails. Tally sticks could be called fiat money and they served Great Britain well for almost 700 years (see The Secret of Oz).
Max asked an interesting question towards the end of the interview inquiring as to who is at the top of the pyramid and you identified the large capital pools (shadow banking) which no doubt manipulate markets on a daily basis to transfer wealth up the pyramid.
I suggest that there is another rung above them that includes the people who hold the private monopoly to create money – the big central banks, the IMF and the pinnacle, the BIS. The central banks are similar to franchises, for example, the privately owned and controlled Federal Reserve is a franchise and their client state is the United States which is financially subservient.
Carroll Quigley wrote in the “Tragedy and Hope, A History of the World in Our Time”:
We are seeing the culmination of this plan today as the central banks (franchises) are being consolidated into a new order that will include a global currency and the ultimate demise of nation states and elimination of private property for serfs – welcome to feudalism.
At the end of the interview Max asked for a solution and I agree with you, that first, a great awakening must occur; a realization that humanity is being enslaved in debt.
Then the solution will become self evident – nation states MUST create their own money, free from the usurious debt of the international banking cartel. Nothing else will do.
Larry
You’re correct Larry about the pyramid. But I want to expose the shadow system to the light of day. I don’t think they should enjoy their anonymity any longer.
It is revealing to study the last time The House of Morgan tried to overthrow the constitutional republic. The fascist plot in 1933 failed. The assassination attempt upon FDR killed others but he survived. At the time it was also revealed that the oligarchy of Wall Street had financed Hitler and Mussolini. Even in 1933 the “core” of the financial elite were powerful enough to “almost” bury the facts of the events. They were able to avoid charges of treason and none of the ringleaders even went to prison (although some of them subsequently died under mysterious circumstances). Here is a web site with resources that discuss the “first” time the Morgan banking dynasty was involved in the fascist takeover of the United States of America. It is now 77 years later. And the fascists are much better prepared this time.
The Oligarchy Plot To Install A Fascist Dictatorship in the USA – in 1933!
Also in 1933 we saw a financial coup by the bankers via HJR 192 where it was declared to be “public policy” that gold and silver or any other “sovereign money” could not be used to pay your debts except FRNs which of course is debt based currency or in other words is a “promise to pay”. They then established and began to “collateralize” the country’s assets (ever heard the term “collateral damage”?) to fund this “bankruptcy” by creating fictional “strawmen” for every human being via the SSN and Birth Certificate and applied a value to these entities. Since they took away the ability of the people to pay their debts with “real money” (asset money) they had to put in place a remedy per the UCC for the people to “discharge” their debt until “real money” is available once again.
Damon, I have also sent your website to people that I know. Is it possible to download your lessons from YouTube? I would like to put them on a DVD and give them to people. Would you mind this? I too, am looking for some sort of plan to follow. I hope that you are not pegged as leader. You may already be on their radar. I have read of a data base system run by our government in old mushroom caves in PA. Don’t know if it is true but with the massiveness of this financial system I can believe it. Please, let us know what we can do to help. It has to start somewhere. Good Luck, Ron
Ron,
LOL! You can bet Damon Vrabel is on the radar! Max Keiser, Alex Jones, David DeGraw, Gerald Celente, Ron Paul, John Williams, and too many others to mention all of them, certainly are! And that means all visitors to their web sites are on a list, also, somewhere! Probably more than one. Have you tried flying anywhere lately? Don’t be surprised if you too are on a no fly list! Remember, this is the INTERNET! Any of over 6 billion people can be reading your words at anytime. Easily! Do you really question is Mr. Vrabel on their radar?
Hi Ron:
If Damon is ok with it, you can use a firefox plugin: “unplug” to download any of his youtube content you like. What is Damon’s policy on this?
Damon, you write in a comment here:
I agree that our solutions need to be drastic. However, I don’t see that phase change at the national level is going to happen and it certainly is not something that we ordinary people have much to say about. So instead of nationalizing the financial system, let’s “communitize” it and restructure it at the community level where we have a chance of actually being effective.
Any national-level solution is likely to leave our communities at the mercy of big business and distant government. We need a way to plan and invest locally, for thriving local economies and a sustainable future. Imagine a society in which communities everywhere gather to decide for themselves what their funding priorities should be — for sustainable agriculture and energy systems, for local self-reliance, for ensuring that everyone has enough to eat, a home, and satisfying work.
The Common Good Bank™ project aims to give us that, by creating the foundation for a community-based democratic economic system that can also compete effectively within the current economic system (and spread fast). The Common Good Bank design combines the spirit of a credit union with the power and growth potential of a stock savings bank.
Any geographic community can have its own democratically-guided virtual bank, simply as a cooperative depositor group within Common Good Bank. Deposits, investments, and profits will be tracked separately for each community. All profits from the community’s investments will go to schools and other nonprofits as decided by the members.
This is a solution that we can do NOW without having to convince our stubborn national government and all the powerful bank corporations to start doing the right thing. All we have to do is get several thousand people to buy in, to start our own bank for the common good.
It’s not simple or easy, but it’s possible.
Damon Vrabel is still trying to educate people. Gerald Celente at his site suggests “breaking the chains” (meaning buy local). David DeGraw suggests the “99%” solution where the majority of people rise up and take back the country from the 1% who have enslaved it. Alex Jones has some suggestions, but like DeGraw , not specific details. Max Keiser of course suggests bringing down some of the big corporations, like with his “everybody buy a silver coin and bring Morgan down”, or boycott Coca Cola. The thought being that would force the Elite to the negotiating table, because they would be getting hit in wallet. The problem as I see with ALL these suggestions is that the Oligarchy does not NEED us anymore. They can ignore everything we think and do because they already OWN just about everything. And by the way most of the analysts are saying we are heading towards WW3 next year or after. And that will really be a sea change in what to do. Ask yourself this. With unemployment checks and extensions being planned to discontinue at the end of this year, with more people than ever being thrown out of their homes, with food stamps for 40 million Americans being the ONLY thing between them and starvation, is there any time left to actually DO something about the problems? If one does not have gold and precious metals yet, and a food depot to last at least a year, and a position to defend their families against a rampant crime wave, how do they think they are going to survive what is coming? Much less talk (more talk!) about what to do?
Might I suggest that you get to know your neighbors well? And if you don’t like your neighbors now, maybe you could move somewhere that you will like your neighbors, and do it as soon as possible?
Damon,
Have you read this? If you have the chance to read and comment, I’d love to hear your thoughts.
http://www.economicpopulist.org/content/junk-economics-and-middle-class-where-we-went-wrong
Sincerely,
Kylie
Why does this author focus on the failure after the 1972 change without mentioning what ultimately led to the 1972 predicament: the 1913 Federal Reserve Act?
Because people already know about that; what they don’t appear to understand is the true nature of the changes that have taken place – on an escalating schedule – since 1972, or maybe 1971, when the Inter-Alpha Group was founded.
Here’s an updated version of the history of bailouts from the 5th edition of “The Creature from Jekyll Island” by G. Edward Griffin.
http://lib.store.yahoo.net/lib/realityzone/creature5thchap3.pdf
Jesse Ventura is doing an interesting expose on TruTV of Bilderburg, the FED, and the evil doings of the Global Aristocracy. I think the show would be even scarier with some of Damon’s insights into the immediacy of the threat we’re facing and degree to which we’ve already lost our humanity: the psychological aspects. On the other hand, Jesse makes the consequences of economic corruption “accessible” to dummies such as myself. Perhaps, with a little schooling on the intricacies of economic slavery, he could be beneficial to the cause of universal enlightenment. (?) He certainly has a larger audience than we; with mass-media appeal. (You know we’re going to need car chases and fire-balls to get John Q’s attention!) Just a thought…………………………………………
I’ll try to contact Jesse V. by e-mail and alert him to the existence of http://www.csper.org and suggest an interview…………..or has this already been done (?)
http://www.thezeitgeistmovement.com/ Maybe there is another option to money.
A system without money? A sane system with money would use money only as tokens to represent the exchange of labor for purchasing power. People might want to keep the net tokens under their sole control, that would mean physical possession, or at least have a secure record of tokens accumulated. Credit records for future activities might also be secured at local utility banking centers. I suppose it might be possible to have a system without money, but it would involve a level of trust that simply does not exist today. In any event to get from here to there we need mark to market debt exposure, all insolvent financial institutions placed into receivership, debt jubilee for all derivatives and other contracts either too complex to resolve, or fraudulent in any shape or form. Then a return to a monetary standard, for example gold, re-valued to allow settling of all debt obligations. Some economists have said maybe $20,000 per ounce would be satisfactory. Then separation of the financial sector into finance, and utility banking. Finance would not use “money” but contracts, and conversion to money would only take place after the contract is settled. “Money” would not be a commodity, and not used for gambling by financial institutions.
Also, everybody who works in finance, as opposed to the “real” economy, would receive competitive exchange of their labor for tokens representing purchasing power, just like in the economy.
That means no more million dollar bonus for what is essentially computer programming. Too big to fail needs to be viewed as too big to continue. And finally, to instill trust again that government and politicians are no longer working for an oligarchy, but represent the people, we need to see LOTS of “financial terrorists” go to prison for a very long time. Maybe, after all those things happen, some system can be formed that does not use money. But used properly, money simply represents the exchange of labor contributing to society, for purchasing power in society. (Once upon a time, if you had your own family farm, and were otherwise independent, you did not need much at all from society).
A question for all.
Assume you get the money system of your choice, whether sound money, free banking, sovereign money, or (your preference here). M0 and M1 are now “officially” stable.
What about other money aggregates like M2 and M3? How does your money system account for those?
What about the secondary equity and bond markets? And the tertiary “derivatives” market?
What do you do about stock option grants and restricted stock grants, which essentially print money from thin air at the whim of a corporate executive? Remember, the price of a stock today is not what it is actually worth if the company were liquidated and proceeds of the sale were distributed, it is determined by guessing at the future performance of the company, which almost always assumes future growth at a rate that exceeds inflation. Essentially, stock price is determined by assuming that the company is actually a financial instrument that compounds interest in perpetuity. How are the grants of stock and options to employees/executives any different than fractional reserve lending in terms of practical effect?
And what do you do about the overall financialization of the real economy, which tasks business managers to run their business to grow forever, which is actually impossible?
“M0 and M1 are now “officially” stable.”
What a relief!!!
“What about other money aggregates like M2 and M3? How does your money system account for those?”
The same as it does now.
“What about the secondary equity and bond markets? And the tertiary “derivatives” market?”
If they don’t serve the Common Good, then their charters should forbid banks from engaging in them.
“What do you do about stock option grants and restricted stock grants, which essentially print money from thin air at the whim of a corporate executive?”
If they don’t serve the Common Good, corporate charters should forbid their issuance.
“Remember, the price of a stock today is not what it is actually worth if the company were liquidated and proceeds of the sale were distributed, it is determined by guessing at the future performance of the company, which almost always assumes future growth at a rate that exceeds inflation.”
That’s the risk you take when you gamble.
“Essentially, stock price is determined by assuming that the company is actually a financial instrument that compounds interest in perpetuity.”
That statement needs explanation.
“How are the grants of stock and options to employees/executives any different than fractional reserve lending in terms of practical effect?”
Fractional reserve lending involves money, stocks aren’t money. I don’t understand the question.
“And what do you do about the overall financialization of the real economy, which tasks business managers to run their business to grow forever, which is actually impossible?”
The “real” economy can and should, theoretically, grow forever; but corporate charters should be written to restrict a corporation’s size to that which best serves the Common Good by fulfilling a specific need. The corporate managers’ task is to manage that. Entrepreneurs, on the other hand, are free to grow as much as the market will bear. You’ll say: “But it’s not fair to corporations.” I say: “Who cares? They’re abstract entities. Screw ‘em!”
Life isn’t a board game. The rules of “Monopoly” don’t apply. Money should represent anything of universally agreeable value that we use as a convenient medium of exchange. Period! Usury through obfuscation is morally fraudulent and would be considered unlawful by an informed citizenry.
m2 and m3 are mostly non-existent as fractional-reserve banking is made illegal, or law is imposed which makes it illegal to use another’s debt to you as collateral. I think in general the world needs to be greatly simplified, which might mean no stock issuance at all, and ownership of companies can only be transferred, bought or sold through partnership arrangements and other individualized ownership arrangements. This would temper the modern bias towards bigness (bigmess?).
Ideally there would be something comparable to a judge or tribunal which watches for unnatural accumulations of wealth, market manipulations, and other possible economic cancers, and cuts the weeds out of the garden as quickly as possible. I’d prefer this solution to just making a hard and fast set of laws because it values continued vigilance instead of contentedness, and has the potential to thwart all problems as long as time is taken to understand economic processes and people look ahead in their analysis and actions. Such a tribunal could effect the long-term adjustments of which our current democracy seems incapable.
Ideally the judges/guardians, the nation and its economy, and the parasites who would feed on them, relate to one another the same way a gardener, his garden, and the insects and weeds all relate to one another.
Would it be feasible to make a thorough understanding of economics and the monetary system a prerequisite to nomination for public office?
Tao, you’ve asked a mighty question. What it illustrates is how deep reform must go; ie, it’s not enough simply to devise a new money.
While I do not have an answer for you as I sit here, I would point out that, before Standard Oil (oh, the damage that family has done) and the concept of infinite corporate lifespan (John D. bought the Delaware state legislature, if I recall), companies had to renew their charter at their respective state legislatures every 25 to 50 years. They underwent a process to certify the worthiness, soundness and need of the business they were engaged in and how they did it. Renewal wasn’t automatic and it wasn’t forever.
Now this is good and bad, of course. In the current era, most of us shudder at the thought of the immense graft this generation of legislative bottom-feeders and elected/appointed malignant narcissists could wring out of such a process. On the other hand, it’s my observation, and I would be happy to be corrected, that a corporation of infinite life whose sole objective is unending growth is a description, at the cellular level, of Cancer. At the human level, it’s a sociopath. Such an organization, and again I would be happy to be wrong, must develop a predatory relationship with the people of the society acting as its host, must focus it resources on avoiding by whatever means possible any limits or restrictions placed upon it, and head-off any future attempts to do so (regulatory capture). I am certain that a true history of International and American fin-corps in our era will demonstrate precisely how this was done. Step-by-step over decades. Likewise American agri-business, insurance and real estate–Eric Janssen’s FIRE economy.
This is a website and blog of big ideas, a rare thing. Money is the point of the wedge of the sort of renewal and reinvention that must happen, I’m afraid. So, Tao: excellent question.
JackKnife, while reading your post, I was reminded that what needs to be reformed is human nature. Game theory explains that as long as there are advantages to breaking the rules, rules will be broken. As individuals and groups accumulate advantages, they increase their ‘fitness’ from a Darwinian perspective. Given time and opportunity, the aggressive dominate.
Many have commented along similar lines:
“The condition upon which God hath given liberty to man is eternal vigilance; which condition if he break, servitude is at once the consequence of his crime and the punishment of his guilt.” — John Philpot Curran 1790.
“Eternal vigilance is the price of liberty” – Wendell Phillips 1852
“The only thing necessary for the triumph of evil is for good men to do nothing.” – Edmund Burke
One of the issues that works against us is population density (scale). When a group of 10 people are involved, everyone can keep an eye on each other. When millions are involved it seems inevitable that one group or another will dominate the masses.
“When a group of 10 people are involved, everyone can keep an eye on each other. When millions are involved it seems inevitable that one group or another will dominate the masses.”
That’s because corporations enjoy a higher lawyer:crook ratio than the masses’ prosecutor:citizen ratio. If one out of ten citizens were tasked to keep an eye on corporate behavior they wouldn’t be dominating the masses. It wouldn’t hurt to outlaw usury and deny personhood, either.
Isn’t civilization the process whereby societies deny time and opportunity to aggressive predators? If everybody shrugged their shoulders in the face of human nature we’d still be swinging from tree to tree eating bananas. I say we storm the Bastille!!!
Rick: Fair enough.
But too many of those quotations sound like condemnations of our sleeping masses, those being violated as they slumber.
The best way into my observation is to take the excellent Burke quotation, (paraphrase) “The only way for evil to win is for good folks to do nothing,” and to realize those violating the world population looked at it before you and I did, saw the truth in it, and said, “Gentlemen, Burke is right. Therefore it is incumbent upon us to figure out a way to make the world population do nothing.” AND THEN THEY DID!
It is emphatically not a case of fully enfranchised, fully awake humans the world over sitting on their hands in the face of a demonstrable evil they have not the courage to confront. Alex Jones’s greatest, most insightful observation is to name his enterprise InfoWar. Those millions if not billions of world citizens have been receiving carefully edited information, information edited to a determined goal; not in their interests nor in the nonpersonal interest of discovering capital-T Truth. You and I and Damon and the folks on this string understand that–and even our getting it expands daily as new things are revealed, or as we see through another facet of the Illusion. So as NOT to judge ourselves too harshly or our sleeping neighbors, we would all do well to recall our benighted state of mind the day before we realized there was an alternative to debt money, or the day before we read a “food safety” bill pending, or any of a hundred crimes and enslaving initiatives to which we are now vigilantly opposed. Was it a case of cowardice, or stupdity, that we were the way we were that day before?
Human nature needn’t be reformed so much as no longer constrained and channeled and narcotized, that it can become free and empowered to act according to the full humanity the violators have gone to such great pains to shrink, like little Bonsai trees. They exerted themselves massively and taken great risks over centuries to do what they’ve done, to make the average human appear and act as he does. Let us give credit where credit is due. The human condition is an enormity here on Earth right now. But every day more wake up. While Vrabel’s blog is mainly economic right now, the event of waking is best discussed, I think, in the other two branches of the his council on renewal, the spiritual and psychological ones.
With all that said, I value your comment, Rick, and the quotes you cited. Being awake you and I have to aspire to the standard they establish. Others, as best they can, to the degree they can, as they awaken.
At any one time in the history of humanity it has only been a tiny minority of people who have been to any degree awake. And in most cases the vast majority of folks have preferred it that way. A convenient lie is often preferrable to an inconvenient truth. You must have noticed how people resist hearing what they don’t want to hear. And how often have you heard it said that curiosity killed the cat?
Hitler very astutely pointed out in his book “Mein Kamph” that the bigger the lie is, the more indisposed people are to not believe it. I recently saw a great example of this in a European talk show video on Youtube. Film director David Lynch was shown videos of World Trade Center Building #7, which had not been struck by a plane, collapsing at freefall speed while various engineers pointed out that it would be impossible for such a collapse to be the result of anything but a controlled demolition. When asked for a reaction Lynch simply said it was too big to contemplate. He just wasn’t going to go there.
I have friends who are well educated and involved in the worlds of finance and business, but when I try to discuss our current monetary system with them they just tune it out. They’re not going there. It’s just too inconvenient. They in no way want to entertain ideas that might put them at odds with the system that they are part of and serve.
It seems to me that only seekers find truth, and that those who are seekers are those who have resisted becoming entangled with the world in such a way that would make the recognition of truth problematical when it presented itself.
At this point in time I find it difficult to believe that anything but a small minority of people will approach wakefulness. The majority have always seemed to prefer the world of ego and illusion. Each of us must pursue his own enlightenment and be satisfied with that. Yes we can be of help to others who are truly seeking, but as for those who aren’t, only they can decide whether to seek the light. Maybe after a complete collapse of their worlds people will be more open to other ideas. It is often that enlightenment follows personal calamity. Be that as it may, our enlightenment and action must not be contingent upon the actions or enlightenment of others.
And one more thing. Our means must be consistent with our ends. We must not use the same tools of force and fraud as our would-be masters do. If we do, we should certainly not expect a different result. Remember, government, being force, is more prone to enslave than to enlighten.
@Tim
“Maybe after a complete collapse of their worlds people will be more open to other ideas. It is often that enlightenment follows personal calamity.”
That reminds me of the quote – “[Most] People don’t change when see the light. They change when they feel the heat!”
Having studied the “psychology of change” and implemented mitigation methods during various projects to alleviate its symptoms, which map closely to the Kubler-Ross model of grief/loss, I can tell you we’re screwed here in the U.S. Or, put less bluntly, we’re going to feel the heat and possibly a “Dark Age” before coming out of this as a nation (or fractured nation.)
Americans, in general and in comparison to other ppl from less wealthy countries, are either a) too busy reacting to their harried lifestyles (kids/chasing the Joneses), b) don’t have the capabilities/education/practice to smoothly adapt to change or c) just don’t care (sloth/narcissism). I’m continually blown away project after project, industry after industry, young and old at the lack of adaptability, willingness for self-introspection and overall courage to look in the mirror.
Some of my professional counselling friends tell me we’re in the middle of an addiction epidemic (drugs, ego, sex, excessive stimuli, etc) stemmed from a leadership and emotional intelligence deficiency. What’s worse is people are going through these daily self-inflicted traumas WITHOUT knowing they’re in trouble (lying to themselves) or seeking any help. They tell me, “People think just b/c you earn a paycheck that you’re all right. The bigger the paycheck, the more all right you must be.” Ugh.
Until people start feeling it in their wallets BIG TIME, then we won’t see real change. Our goals here should be modest – awareness, awareness, awareness.
@Ranallo,
Very insightful comment. I’d argue that the real problem is that our social institutions are all designed to divide and conquer, to atomize us all into indiviudal, sociopathic consumers who are easily controlled and manipulated, who don’t know how to trust one another or even think about joining in asserting a common cause (or, if we do, the common cause gets hijacked, a la the Tea Party).
Also, I’d argue that we’re already in a “Dark Age” of sorts, courtesy of my favorite bogeyman, neoliberalism. Michael Hudson observes something similar here (Neoliberalism and the Counter-Enlightenment):
http://michael-hudson.com/2010/05/neoliberalism-and-the-counter-enlightenment/
Krugman has commented on what he sees as a “Great Forgetting” in the economics field (I agree with the observation, not his recommendation for addressing it), and I’m seeing one in the field of the law, as well. Everything that the Enlightenment brought western civilization is being systematically dismantled. The only question is, when things get bad enough that everybody wakes up to the world as it really is, will they fight back to regain what they’ve already lost, or will they finish the job of destroying what’s left of what the Enlightenment brought them?
@Tao
I’ll keep an open mind and read that 34 page social democratic rant. I do agree that economic systems dictate most people’s behavior. Incentives matter.
Another simple argument I’ve heard is this is the natural progression of empires where the monopolists and their govt shills anesthetize the people with luxury, entitlements and frivolous distractions to the point of collapse. Sort of like many 2nd generation children of wealthy parents.
Sidenote – does it ever bother you that all your favorite economists consistently do poorly at economics, e.g. predicting future trends? Granted, Kruggie did call for the creation another bubble in housing to offset the one just burst in tech. That was an accurate call:-)
@Ranallo,
You read too much into things.
If I have “favorite economists,” they would be Steve Keen and Michael Hudson. Steve Keen actually called the current financial crisis and has been recognized for doing so. Hudson actually did, too (see link below to a 2006 article in Harper’s entitled “The New Road to Serfdom: An Illustrated Guide to the Coming Real Estate Collapse). I view Hudson as a great economic historian, so if you can look past his social democratic leanings, I think you’ll find something of value there. (Hudson’s latest post includes some Krugman-bashing, and rightly so.)
Krugman is somebody that I consider a willing accomplice of the Washington Consensus, and I think his solutions (e.g., QE2) for the current economic situation are wrong-headed. That being said, he strikes me more as a pointy-headed academic than a bought-and-paid for shill like Brad Delong (D) or Greg Mankiw (R). I had more respect for him before he started carrying water for Obama during the “healthcare reform” debate and the financial “reform” debate, but I still read his blog (not his op-ed pieces), only with a healthy dose of kosher salt.
Basically, I’m willing to read/hear what any independent thinker has to write/say about our current socio-economic situation unless and until I have reason to believe that they’re bought and paid for.
Hudson article:
http://www.harpers.org/archive/2006/05/0081029
(FYI – it looks like the article is now behind a pay wall, but I grabbed it before they did that. If I can find it, I can email it to you. I can be reached at taojonesing at gmail).
Tao,
You mentioned in your reply to Ranallo that Michael Hudson and Steve Keen both divined our recent mortgage inspired financial debacle. I find it very germane to the discussion of the general dearth of economic enlightenment that so few saw what was so obvious.
After all, anyone who had sat through Economics 101 should have known that you could not have double-digit price rises in the median price of homes while median income remained flat. The fundamental law of price is the law of supply and demand. The only way that prices can rise is as a result of increased demand, barring a shortage of supply. Now it should be obvious to any college freshman who has taken an introductory course in economics, in this situation, that there was no real viable demand fueling the rapid rise in home prices.
One needn’t know anything about the actual mechanics of liars loans, bundled securities, credit default swaps, or any of the other financial machinations in play to see that the housing bubble was just that, a bubble driven by hot air of some kind. And since all hot-air bubbles must fall at some point, the denouement should have been clearly predicted by any freshman who had stayed awake during that introductory economics class.
So the relevant question is why did so many ‘experts’ sporting the letters ‘PhD’ after their names fail to make the call? It seems that an understanding of this phenomenon would be somewhat illuminating.
@Tim,
So many PhD economists got it wrong because they were paid to get it wrong. The PhD economists who got it right– people like Nouriel Roubini, Steve Keen and Dean Baker– were ridiculed and marginalized by their peers.
The better question is why is it that the PhD economists who got it right offer no real solutions? In the MK interview, Damon rightly notes that Steve Keen fully understands debt-money but offers no alternatives, only ways to control the potential damage.
I think the reason is that economists, particularly mainstream economists at the top of the orthodoxy, know that they will lose their livelihoods and, ultimately, be “disappeared” from history.
I know of two economists who have been disappeared from history, albeit in very different ways.
First, there’s Henry George, whose observations regarding land rents and speculation led to the reformation of classical economics into neoclassical economics. Before NCE, economics were understood as the interaction between capital, labor and rent. NCE eliminated rent from the discussion, and thus George’s criticisms were mooted. See this interesting discussion of the history. The thumbnail discussions of the early neoclassical economists are fascinating (especially that of Pareto about 8 pages in):
http://homepage.ntlworld.com/janusg/coe/cofe00.htm
Keynes is the second economist that has been “disappeared,” primarily through the bait-and-switch tactic of applying his name to something that only partly resembles his recommendations (the so-called neoclassical Keynesian “synthesis”). In the last few years, we’ve had a lot of people asserting that the financial crisis proves the failure of “Keynesianism,” but the fact is that our economic policy has been Chicago School monetarism for the last thirty years. Bernanke is not a Keynesian but a Friedmaniac. Within a decade, though, everybody will be convinced that Bernanke and Friedman were Keynesians, which is ridiculous, but when you repeat a lie often enough, it becomes the truth.
I don’t know if implementing what Keynes actually suggested really would have resulted in the euthanasia of the rentier class (the class that employs economists), but the rentier class sure went through a whole lot of effort over a long period of time to discredit Keynes. By the time the Chicago School of Ponzinomics is done ravaging our economy, everybody will “know” that it “Keynesianism” was to blame, and Keynes will finally be forgotten.
The bottom line is that any orthodox economist that promotes policies that would eliminate the rentier class will be cast out of the rentier’s Garden, and no heterodox economist who promotes such policies will be allowed in. What Steve Keen doesn’t understand is that even suggesting mechanisms to manage or control boom-bust cycles won’t be tolerated. The rentiers benefit the most during both sides of the cycle, which is why they ultimately want to see a new orthodoxy like the Austrian School, which pretends that such cycles are entirely natural and not manipulated or controlled by anyone.
Hi Tao:
This last post of yours again leaves me scratching my head. You again fail to mention the many economic thinkers who also predicted the current predicament like: Ron Paul, Thomas Woods, Lew Rockwell, Peter Schiff, I could go on. Yes, they are what you call “Austrians”. And a significant proportion of them, who are like me and view involuntary exchanges as a form of theft, would see your above statement:
“they ultimately want to see a new orthodoxy like the Austrian School, which pretends that such cycles are entirely natural and not manipulated or controlled by anyone.” ..
as a real mystery. Do you actually believe this and/or are you able to put together a rational basis for such a statement? In fact for those of us who are in the free market “government” camp we don’t know whether to laugh at this point or feel embarrassed for you.
Are you even vaguely aware that in a free market for adjudication services, every entity that has obtained wealth through involuntary exchanges will be subject to demands for arbitration/restitution by adjudication entities presenting torts that “they” cannot manipulate away through government pull? Do you actually think “they” want hundreds of thousands of tort claims by the victims of the Federal Reserve beneficiary families, just to cite one small example. No way. “They” would start world war III or start a global pandemic before they would stand around and let that happen. Since your wording and command of other facts is quite articulate, I am being led to conclude that your motives here are somewhat veiled. Please can you enlighten me to the mystery of the rational basis of such a statement above. From where I sit it looks absurd, UNLESS you are being paid to be here. If you were then you would be one of the first to accuse others of being shills here, which I think I noticed you claiming earlier so that is lining up that way too. Its not proof, but it is getting me to wonder. Also your difficult (from my perspective) to defend conclusions from von Mises participation in Mont Pelerin Society again leave me scratching my head.
I think I have been clear in the past about my “solution” to the “problem”, the problem that led most of us to us being here, and the solution being non-monopoly adjudication/enforcement/security services, in short a free market in EVERYTHING, ESPECIALLY and starting with a free market in the things “they” absolutely do NOT want free markets in: as I briefly explained above to cite one small example.
Are you revealing yourself as an advocate of the wielding of the club of (governmental) involuntary exchange upon “them” when history and common sense would lead me to conclude that “they” will be the ones ending up wielding the control of such a club in a new form like they always have? Please, am I getting this wrong? Explain yourself? And also just what is it you are advocating as the “solution” to the “problem”?
The first few paragraphs of Hudson’s May 2006 Harpers article
“Never before have so many Americans gone so deeply into debt so
willingly. Housing prices have swollen to the point that we’ve taken
to calling a mortgage—by far the largest debt most of us will
ever incur—an “investment.” Sure, the thinking goes, $100,000 borrowed
today will cost more than $200,000 to pay back over the next thirty
years, but land, which they are not making any more of, will appreciate
even faster. In the odd logic of the real estate bubble, debt has come
to equal wealth.
And not only wealth but freedom—an even stranger paradox. After all,
debt throughout most of history has been little more than a slight variation
on slavery. Debtors were medieval peons or Indians bonded to Spanish
plantations or the sharecropping children of slaves in the postbellum South.
Few Americans today would volunteer for such an arrangement, and therefore
would-be lords and barons have been forced to develop more sophisticated
enticements.”
And the last few paragraphs of Hudson’s May 2006 Harpers article:
“Free markets are based on choice. But more and more homeowners are
discovering that what they got for their money is fewer and fewer
choices. A real estate boom that began with the promise of “economic
freedom” almost certainly will end with a growing number of workers
locked in to a lifetime of debt service that absorbs every spare penny. Indeed,
a study by The Conference Board found that the proportion of households
with any discretionary income whatsoever had already declined between 1997
and 2002, from 53 percent to 52 percent. Rising interest rates, rising fuel costs,
and declining wages will only tighten the squeeze on debtors.
But homeowners are not the only ones who will pay. The overall economy
likely will shrink as well. That $200 billion that flowed into the “real”
economy in 2004 is already spent, with no future capital gains in the works
to fuel more such easy money. Rising debt-service
payments will further divert income from new consumer
spending. Taken together, these factors will
further shrink the “real” economy, drive down those
already declining real wages, and push our debtridden
economy into Japan-style stagnation or worse.
Then only the debt itself will remain, a bitter
monument to our love of easy freedom.”
Yes, I will agree most everyone you meet will avoid discussing the ramifications of our current “mess” because what are the solutions? I don’t think there are any that continue the status quo so we’re all collectively fine with continued can kicking until the crash.
That’s the $64 trillion dollar question, when and how does it all fall apart? And what happens after the crash? And the answer is: there is no ‘knowable’ answer until after “it” happens.
Sure sound money and a sound economic model are good topics for discussion, but you must have a government that will implement these measures in place first. So what is a good model for a post crash government for the USA (and by proxy the rest of the Western democracies)?
The first argument I’ll guess most reading this would make, is a return the roots of American republicanism as outlined in the U.S.’s constitution. A counter I would make is the founding of the USA was based upon an elitist aristocracy who first wished freedom from their homeland and its major corporation, the British East India Co. to pursue their version of life, liberty, and the pursuit of happiness with those rights of lesser freeman, women, indentured servants, and slaves quite down the list in order of importance. A good read for this argument is here
http://cyberjournal.org/authors/fresia/#toc
Myself, I’ll take the 18th century elites over the elites of today if given a choice as I believe the 18th century version had better educations and morals than the current batch, but in the end, their ideals were not that democratic.
If America’s original model is flawed, what about Switzerland’s? After all they formed their confederation in the 13th century; it encompasses different ethnic groups speaking different languages, yet is still running strong today, and defied both Napoleon and Hitler. It’s a direct democratic system where local power trumps central and referendums of the populace have the final word, i.e. the people decide directly, not through representatives. They maintain a large and well trained militia, yet have no designs upon conquest. I think this is the best model for post crash America, but instead of having 50 states, states will need to join up in geographical sectors to limit bureaucracy and the military will need to be disbanded except for homeland defense. I, on the other hand, don’t think a direct democracy will work initially in the USA because the populace is not educated enough for it.
How about Soviet style communism? Take away the individual profit motive and what do you get, “I pretend to work, and you pretend to pay me.” That and the USSR has proved this model unworkable over time.
One last ism is fascism, or technitronic corporatism. I’ll contend we’re currently living in a fascist-lite state, which leads me to believe this is the course TPTB will implement. My guess is the Barack Obama’s election to the US presidency was made to happen to say: “See we elected a black President, and what did he do to fix our mess, nothing.” If this guess is accurate, we’ll next have a woman like Sarah Palin or Hillary Clinton installed in the presidency so “they” can say: “Next we elected a woman and what happened? Collapse.” With the goal of course being to bring in a Hitler-type strong man to implement the police state, until “Big Brother” is segued into “Brave New World.”
Or maybe I just listen to too much Alan Watt.
Yes, I will agree most everyone you meet will avoid discussing the ramifications of our current “mess” because what are the solutions? I don’t think there are any that continue the status quo so we’re all collectively fine with continued can kicking until the crash.
That’s the $64 trillion dollar question, when and how does it all fall apart? And what happens after the crash? And the answer is: there is no ‘knowable’ answer until after “it” happens.
Sure sound money and a sound economic model are good topics for discussion, but you must have a government that will implement these measures in place first. So what is a good model for a post crash government for the USA (and by proxy the rest of the Western democracies)?
The first argument I’ll guess most reading this would make, is a return the roots of American republicanism as outlined in the U.S.’s constitution. A counter I would make is the founding of the USA was based upon an elitist aristocracy who first wished freedom from their homeland and its major corporation, the British East India Co. to pursue their version of life, liberty, and the pursuit of happiness with those rights of lesser freeman, women, indentured servants, and slaves quite down the list in order of importance. A good read for this argument is here: http://cyberjournal.org/authors/fresia/#toc Myself, I’ll take the 18th century elites over the elites of today if given a choice as I believe the 18th century version had better educations and morals than the current batch, but in the end, their ideals were not that democratic.
If America’s original model is flawed, what about Switzerland’s? After all they formed their confederation in the 13th century; it encompasses different ethnic groups speaking different languages, yet is still running strong today, and defied both Napoleon and Hitler. It’s a direct democratic system where local power trumps central and referendums of the populace have the final word, i.e. the people decide directly, not through representatives. They maintain a large and well trained militia, yet have no designs upon conquest. I think this is the best model for post crash America, but instead of having 50 states, states will need to join up in geographical sectors to limit bureaucracy and the military will need to be disbanded except for homeland defense. I, on the other hand, don’t think a direct democracy will work initially in the USA because the populace is not educated enough for it.
How about Soviet style communism? Take away the individual profit motive and what do you get, “I pretend to work, and you pretend to pay me.” That and the USSR has proved this model unworkable over time.
One last ism is fascism, or technitronic corporatism. I’ll contend we’re currently living in a fascist-lite state, which leads me to believe this is the course TPTB will implement. My guess is the Barack Obama’s election to the US presidency was made to happen to say: “See we elected a black President, and what did he do to fix our mess, nothing.” If this guess is accurate, we’ll next have a woman like Sarah Palin or Hillary Clinton installed in the presidency so “they” can say: “Next we elected a woman and what happened? Collapse.” With the goal of course being to bring in a Hitler-type strong man to implement the police state, until “Big Brother” is segued into “Brave New World.”
Or maybe I just listen to too much Alan Watt.
http://www.realecontv.com/videos/europe/whats-that-sinking-sound-.html
@Tim,
I saw the video a couple of days ago. I wish we had politicians like Nigel Farage in the U.S. I’ve seen speeches by him before. The EU is a neoliberal experiment, and it is worthy of the scorn he heaps on it.
Here’s another one from him: http://www.youtube.com/watch?v=bypLwI5AQvY
Tim; thanks for the video links. I’m a subscriber now and go there daily.
To you, Tao, and the others here who talk in terms of branded schools of economic thought:
I had an hour-long argument with a friend and close associate who is also conversant in the various “schools” of economics regarding the effectiveness of labels in the discussion of issues. In the end, I had to admit their usage was convenient short-hand for complex theoretical positions, but only when the participants were of like mind and agreed on the basic assumptions thereof but provoked senseless arguments when said labels were used to express detailed analysis in a specific context. I don’t pretend to understand the tenets of any “school” but it’s got to be obvious that such branded theories, especially those with capitalized proper names, must have an expiration date. As I learn and evolve my beliefs change (daily lately) and what I thought was true yesterday might be seen as folly today. Can it not be said that these branded theories are perishables, to be discarded after a week or two? The originators of such theories deserve the benefit of further reflection, no?
Given that the economic matrix changes with every new banking regulation, court ruling, and hiccup of the stock market isn’t it reasonable to assume the observer’s perspective would be altered to reflect that change? If so, then no “school” of thought can answer the questions posed by an ever-changing reality in anything but the most generalized of terms. Applying old thoughts to new realities can only result in misunderstanding, leading to argument, leading to demonization, and finally culminating in catastrophic intellectual debate. ;<)
We ended our discussion with agreement that it was permissible to use labels, but only with great caution to avoid generalities in doing so. We're still good friends, though we disagree on many issues. Our viewpoints evolve as we learn from each other. I've never learned as much, or as fast, as I've learned from the geniuses here on this here forum so keep it coming! Make me "get it" ! My mind is an electro-chemical shop-vac for intellectual refuse but the stuff I glean from the filter bag is priceless (small tools, rare screws, etc).
I’ll admit to using the brands as a shorthand way of referring to a the various economic belief system (that’s what any branded school of economics provides, kind of like a religion). This is easy to do because I do not subscribe to any of those schools or belief systems. Why? Because each and every one of them springs from a common ancestor that was not meant to describe how the world and economies actually work but to persuade the masses that what certain people were doing would benefit everyone.
People like Hayek, Mises and Rothbard understood full well that their real function was to persuade people that their belief system was correct, not to accurately describe how the world really works. I’ll give you three examples. First, Hayek said that central planning by a government can never work while “overlooking” the fact that every corporation, some of which are larger than some nations economically, engages in central planning. Second, we have this howler from Mises: bureaucracy can never arise in private enterprise. Oh, really? Third, in a confidential memo to the Volcker Fund (a primary funder of Hayek, Friedman and the neoliberal movement in general) we have Rothbard describing the need to engage in Leninist propaganda tactics to push the neoliberal point of view (which he calls libertarian-individualist).
I have no problem accepting that each of these men believed in what they were selling– which was their common neoliberal belief system– but there can be no doubt that they were salesmen who routinely engaged in puffery if not outright consumer fraud. To them, however, the ends justified the means.
I fully understand that some true believers are indignant that I’d lump in the Austrians with Milton Friedman and the Chicago School of Ponzinomics, but the fact is that these guys were in complete alignment as to their politics (i.e., the desired ends) and disagreed only about certain aspects of economics (i.e., the desired means to that end). And I’d argue that much of the disagreement about the economics was a sham because the Austrians had to know that, politically, the interventionism of the neoclassical-Keynesian synthesis could not be discarded unless and until inteventionism was proven to be a complete and utter failure, which is the job of the Chicago School of Ponzinomics. The fact that these men were aligned politically should make any true believer (from either branded school) question his adopted belief system.
I’ve done it before, but I’ll pinpoint what Austrian true believers need to question the most: (1) the Austrian Business Cycle Theory, and (2) private “free” banking as a solution to business cycles.
Ah Ha! Now I get it ! Those aren’t schools – they’re religions. It all makes sense. Economists then, are in reality, evangelical consumers in sack cloth robes just as comedians are philosophers in sack cloth robes. So, if there’s a Promised Land for consumers, do banksters wear sack cloth robes, or silk suits? We won’t know until we get there, right? OK, I’ll take it on faith.
I too am an economic agnostic but still, I think the first thing we should do in the coming Age of Enlightenment is to round up all the Austrians and question them on the rack to confess their heresy, or be drawn and quartered on Reality TV for all to see. All this divisiveness has to stop or we’ll never be free .<)
Might it not be more profitable just to discuss specific economic ideas and leave off of the use of labels altogether, as labels tend to circumscribe thought and to mean different things to different people? I find that labels distract from the actual examination of ideas and tend to put those who use them into camps who then set about the defending of their ‘schools of thought’ attached to these labels. In that respect the discourse does tend to devolve to the level of religion which is most often about doctrines and prophets, i.e., Von Mises, Keynes, Marx, or whomever. When this happens we get more heat that light.
Having said this, it seems to me that one can find certain truths from a wide variety of sources, including all of those mentioned above, without having to uncritically accept all that is said by any one of them. For example, can we not observe for ourselves that economics has to do with human action, as stated by Von Mises, without elevating him to the status of an infallible authority? And can we not deduce from this realization that all of men’s actions in the economic realm flow from subjective individual judgements? And can we not also see that Marx was correct when he told us that political institutions tend to be molded to serve the interests of the ruling elites? And can we not then deduce from this that government, which is force, will most likely always be the servant of certain elites?
Given these rudiments, can we not then discuss their ramifications, searching for whatever illumination we may find and forget about the labels, personalities, and schools which only seem to lead to dissention and faction? I am personally very anxious to hear the discussion of specific economic ideas in detail, but find a plethora of, what are to me, vague labels and generalizations of no value.
@Tao/Tim/Freedom Fighters,
Is this “Pile on Tao Week”?:-)
Agreed. Labels just distract especially since we’re all in different professional fields and have different academic knowledge bases. Words are just too relative especially at this level of discussion.
To that end, I’ve been a part of some public/private organizations that have actually achieved sustainable models, didn’t have cost overruns and delivered on their goals without driving their own self interests into perpetuity. So, while “socialism” certainly doesn’t work for large populations where the bureaucrats don’t live with their decisions and receive information quickly enough to adapt to reality, it can have applicability within local settings.
At the same time, I’ve run into natural monopolies in small towns (and cable companies) where public and private merged forming a predatory suction pump of value for its inhabitants. The choice for those ppl was “deal with it” or leave. Granted, I’d argue that it’s the govt’s role to promote freedom by allowing competition…but that’s another debate.
I vote for leaving labels with the pundits and demagogues.
“And can we not also see that Marx was correct when he told us that political institutions tend to be molded to serve the interests of the ruling elites?”
I disagree; most constitutions I’ve read tend to serve the interests of the nation as a whole and even the Russian constitution looks like a recipe for heaven-on-Earth. I believe that politicians break or bend the mold to suit their own interests, but not publicly.
“And can we not then deduce from this that government, which is force, will most likely always be the servant of certain elites?”
Government is government. Force is force. Citizens have individual force in the form of guns. Government has organized force in the form of armies, with more guns. Turnips have force in the form of gravity. Throughout history governments have been overthrown by their citizens so you can’t say that governments have a monopoly on force. Governments often do have a monopoly on ignorance however and turnips are often overturned ;<)
http://hken.ibtimes.com/articles/85424/20101124/china-russia-drop-dollar.htm
http://www.realecontv.com/page/765.html
http://www.realecontv.com/videos/china/gold—chinas-end-game.html
Interesting. I’d say its a good move by the Chinese but of course not so good for us Americans and the crippled dollar.
http://www.realecontv.com/videos/central-banks/we-still-dont-have-answers-to-these-questions.html
So much for congressional oversight of the Fed. The money power will always subvert any governmental oversight or control of its interests…something to be considered by those of you looking to government solutions.
By the way, they got rid of this pesky congressman in the recent election. It would be interesting to know how the money power was involved. I can’t believe they weren’t.
William,
When I spoke of governments serving elites, I was not speaking of who governments claim to serve or the intentions of some of those who helped to establish them. Your citing of the Russian Revolution and its claimed utopian aims is precisely to my point. Intellectuals and others around the world supported this promise of a workers’ paradise only to be bitterly disillusioned. The rhetoric was beautiful but the reality was a nightmare. This historical example ought to give those entertaining new government schemes at least a moment’s pause.
It was George Washington who told us, “Government is not eloquence or reason, but force. It is a fearful servant and a terrible master.” Like all of our nation’s founders he was well aware of the many tragic lessons of history. That is why the founders tried to limit government to the preservation of liberety. But they also knew, as did Santayana, that those who are ignorant of history are bound to repeat it. Their pescience has certainly been born out.
Having paused for the obligatory moment I feel compelled to re-affirm my belief in our Founders’ vision of government’s proper place in the world of man; greatly favoring the “fearful servant” model. Ever hopeful, I attribute our current trend toward economic slavery to the unforeseen consequences of a commercially-sponsored news media.
Ascribing prescience to wise, but mortal, men goes a step too far in the direction of ancestor worship and my admiration for their wisdom doesn’t stretch to deification.
The fact is – we’re NOT ignorant of history. We DO know better. The failure of unbridled corporatism is self-evident. So let’s fix it ! We’re not powerless. The public IS becoming aware of the growing return to feudalism. The polls show a growing distrust for politicians, bankers, and the commercially-sponsored media while increasingly they go to the internet for the truth. These trends are undeniably pointing to the eventual de-centralization of our most vital institutions. The sheep are getting tired of being pushed toward the cliff if you know what I mean and I think you do. All we need to do is keep doing what we’re doing and follow in the path of our beloved Founders until the Constitution contains words like “Corporation”; “Media”; “Broker/Dealers”; and “Internet” and defines their relationship to the Common Good.
We need to pick the Beast apart one Corporate Charter at a time until it fears us. Let’s start with “personhood”.
I exploded and cleaned up a copy of the Federal Reserve System flow chart last year for instructional purposes and uploaded it to PhotoBucket for anyone who could use it:
http://i282.photobucket.com/albums/kk264/falbergsawco/ChartofFederalReserveSystem.jpg
I don’t know how accurate it is but it’s posted on Wikipedia in thumbnail size – my eyes weren’t so good at the time. Can anyone point precisely to the dysfunctional block or broken link causing the entire system to go so horribly wrong?
The first recorded instance of paper fiat money appears in Marco Polo’s writings of his travels in Asia in the 13th century. He records how the Great Kahn of China, by creating paper money and declaring it legal tender by fiat (fiat money), transferred the bulk of all real wealth, including precious metals and jewels, into his own possession. Polo describes the Kahn as living in unparalleled wealth and splendour. From that time to the present fiat money has been used, without exception, to transfer real wealth from the creators of that wealth (the people) to the creators of the intrinsically worthless fiat money.
The problem does not lie in one of the blocks of your Federal Reserve chart. The Fed is just the window dressing supplied by the creators of the Fed (banksters) to give their counterfeiting scheme an aura of legitimacy. All of the operatives shown on the chart are appointed either by bankers or by politicians whom they control.
They, the banksters, have known for centuries that if you control the money you control the government, and have said so. This is why the authors of the U. S. Constitution wrote into that document that only gold and silver be made legal tender in all of the United States. That should solve the problem, right? But then we see that although that Constitutional provision still stands, fiat money, in all of its modern incarnations, has become the exclusive legal tender in all of this land. And we also see that all of our elected ‘servants’ put their hands on a Bible and swear to defend and protect the Constitution of the United States. Well, it appears that not even the highest law of the land can contain the banksters and all of those bought by their ‘money’ and ‘credit’, and they are many. And as for ‘the people’ my experience has been that far too many are about as informed as those you see on Jay Leno’s “Jay Waliking” segments.
I find it incredulous that there are still people with any grasp of history advocating various fiat money schemes thinking that it will be different because they and their friends are advocating this new and improved monopoly money. I can only quote Albert Einstein here: “Insanity consists of trying the same thing over and over again and expecting a different result”.
Forget the chart. It’s totally bogus from top to bottom and only intended as a visual aid for elementary school use anyway ( instilling the myth early-on). My object was to compose a reality-based update but plainly, that’s not going to happen. Thanks for the history lesson – I missed fifth grade and appreciate your filling me in.
Your point is far more interesting. Assuming as you infer, that fiat money is the Devil’s trident, what is the enlightened alternative? …………Tally sticks? Pigs? Gold? Wives?
You seem to fear the evils of banking yet apparently have no respect for governments’ ability to regulate them. I have to ask: ……..“Are we simply doomed, no matter what we do?”
Do you have any suggestions for a plan that satisfies our basic economic needs for an equitable system of trade, or are we condemned to an eternity of economic slavery? Is slavery the natural plight of mankind? If the answer is “Yes” then why are you here? If the answer is “No” you must have a solution and I for one am dying to hear it; preferably in your own words. The dead thinkers you usually quote weren’t facing foreclosure and their advice loses relevance in the present context.
Let me just quote a couple more dead thinkers. I think that James Madison summed up the problem at hand when he said, “The reason men form governments is that men are not angels. The problem is that governments are made up of men”. So how do we escape this dilemma?
The second quote is from Thomas Edison. After having tried some several thousand different substances as filaments for his proposed electric lightbulb, Edison was asked, “Aren’t you tired of failing?” Edison replied, “I haven’t failed. I have already discovered many things that will not work.”
History has shown me some of the things that have not worked. I am still seeking answers as to what will work. That is one reason I frequent this blog. But as for trying things that have already been tried and failed, I would just suggest that there is no education in the second kick of a mule.
I knew you couldn’t reply without more historical quotes – so let’s work with that.
You say: “………there is no education in the second kick…..” ; yet the revered T. Edison (RIP) himself said: “I haven’t failed………I have already discovered many things that will not work.” You dare to contradict the Master of Invention? He’s dead – he can’t be wrong.
As for Madison, he was wrong about banking from the git-go and statements such as : “The reason men form governments is that men are not angels. (Duhhhh !) The problem (what problem?) is that governments are made up of men”. Jefferson thought governments should be made of laws. Isn’t that what the Constitution was for? Quote me some more quotes on that one.
“So how do we escape this dilemma?”
What dilemma? More quotes please.
I’d like to pontificate a little on my own here. Criticism comes naturally to human beings. As children incapable of offering a better solution we ridicule every imperfection as a sign we know better than our parents. Growing up, we face a constant uphill struggle against out-dated traditions. As adults, refusing to admit we haven’t solved anything, we continue to criticize, thinking it makes us look smarter. Creating solutions, on the other hand, requires holding out new concepts for public inspection and certain criticism. It’s too risky for the meek, but successful inventors incorporate public criticism into their revised models and eventually produce something equivalent to a functional and affordable “light bulb”. Successful inventors have thick skin and routinely toss off negative feedback but focus their efforts toward overcoming constructive criticism.
This forum could and should become the feedback channel for such constructive feedback. I hereby urge the intellectuals lurking herein to spew forth your wildest dreams and subject yourself to the multitude of nay-sayers in the hopes of lighting even one candle of light. Damon did it on the CSPER home page but all we’re seeing in the blogs is fear and negativity. Lots of smoke but little flame. Where’s the support for Napolitano taking a stand on a MSM news channel to enforce the EXISTING Constitution? Janet Tavikoli made some profound statements indicting Wall Street and the FED on C-SPAN so the problem is being exposed but, so far, no one is proposing corrective alternatives. If we don’t take the lead on leadership in that regard, who will? Looking back is all well and good but it doesn’t guide the future. For that we need action. Action in this context (to me, at least) means reaching some kind of consensus on the issue of a possible and workable monetary system that isn’t privately held and publicizing a workable means to achieve that goal.
The point I was trying to communicate through Edison’s quote and the metaphor of being kicked twice by the same mule was that when a certain strategy is demonstrated to be wanting one must search for alternatives. Isn’t it obvious that when Edison failed at one attempt he examined another rather than repeat the failed one? I am surprised that you haven’t grasped my meaning here. It seems more than obvious.
Now here is another quote you may not like, pertaining to the value of history: “The stupid man refuses to learn from his mistakes, whereas the smart man does. But the wise man learns from the mistakes of others.” It is not necessary to relearn the lessons of history. True progress depends upon our learning from the experiences of those who have gone before us, otherwise we are doomed to constantly repeat the same errors over and over. However, this presupposes that we study and contemplate history.
But that does not mean that we should hold our ancestors in uncritical awe. After nearly a thousand years of languishing in limbo with virtually no progress in the sciences, man began to finally awaken and move ahead again during the Renaissance and the Enlightenment…but not before he was able to evercome a worship of ancient authority.
It was not until these more modern times that folks discovered that flies have six legs. Nobody had ever checked because Aristotle, who was held in such high esteem, had said that flies have four legs. He also said that the Earth was the center of the solar system, that heavier objects fell faster than lighter ones, and many other things that were incorrect. Only when people like Galileo decided to look for themselves were these errors exposed. Yes, Galileo challenged the wisdom of predecessors, but all subsequent scientific progress is indebted to his critical attitude.
The dilemma that Madison brought to our attention was that although man had made great strides in the sciences, his spiritual progress remained problematical. And so how was a government made up of spiritually flawed people supposed to correct the problems of those same spiritually flawed people. To paraphrase another quote: “The flawed shall lead the flawed and they both shall fall in the ditch.”
The relevant question seems to me to be how can we make a moral society out of immoral people. And even more to the point, how can one make anyone moral but oneself? Is not the lesson of history abundantly clear that morality can not be legislated? And is this not the dilemma of which Madison was only too aware?
Iceland refused to bail out its banks and is recovering nicely.
http://www.guardian.co.uk/business/2010/dec/07/iceland-exits-recession-third-quarter
Here’s a great rap video pitting Hayek vs. Keynes.
Damon,
Add Dr. Paul Craig Roberts, former assistant Secretary to the US Treasury under Reagan, to the team – http://www.youtube.com/watch?v=moHrpJK2Dl4
FF to 5:30 to watch Dr. Roberts mince no words. The whole interview is interesting including how Reagan and his views got hijacked by the neocons.
Hi Damon. At the end of the day, if we do what Ben Still suggests, have the government print the money then we would have the necessary foundation to revolutionize the way we as a free society progress. Without the implementation of interest free currency everything we do is ultimately stunted as those who are in complete control of the money supply can thwart any progress by manipulating our economy with more inflation or contraction and recession. So, shouldnt it be obvious that the first essential step to change things in any meaningful way requires that the population clearly understands that our money system is broken and that all we need to do to fix it is to eliminate the banks from issuing the money and putting that power back into the proper hands of the congress which is clearly defined in the constitution. Lets keep things simple as possible at this point in time and try to dig as deeply into the root as possible on the first dig. People like yourself can show us how to transition ourselves into this “new” way of banking. I do agree with you that any change will need to come from the bottom up and although we are very divided the grassroot issue we can all agree on is that the banking system is broke and needs to fixed. Focusing on how we get our money, where it comes from and who controls it seems to be the best thing we can do first going forward, dont you think?
Remember Damon, most people dont vote, they understand that the game is rigged, the numbers clearly favor us!
Sovereign money?
http://www.thedailybell.com/1630/Anthony-Wile-The-Rise-of-Brownianism.html
SCOTUS wins POTY award for 2010
Exploring the sarcasm behind the ironic choice of Supreme Court Of The United States as Person Of The Year; ……………….(as if it needed explanation). The Citizens United vs Federal Election Commission decision lays open the bare bones of the 200 year old argument between the advocates of Thomas Jefferson and Alexander Hamilton. Is it judicial activism; a call for legislative action; or tired bureaucrats’ last, dying wish for a benevolent kleptocracy to make their decisions for them?
Few would deny that we’re currently experiencing a Global Financial Crises and most can agree it’s not due to environmental calamity such as flood, drought, locusts, or earthquakes. Economists can’t agree on what exactly DID cause it but it’s commonly agreed that some fundamental changes need to be made or civilization, as we know it, will suffer a complete breakdown. You can blame un-regulated free-market capitalism, over-centralization, global banking cartels, government corruption, financial colonialism, the two-party system, or global warming myths; but those are only symptoms of the basic flaw underlying all sovereign and international economic systems in practice today – the idea that institutions should have rights and privileges above and beyond those of the individuals that comprise it. Banks use this rationale to leverage capital and they call it fractional reserve lending; a prime suspect in our current banking predicament. Governments (such as our own) use this idea to justify their self-serving agendas on the speculative grounds of “public mandate”. International corporations use this idea to justify fraud and usury under the guise of “serving the stockholder”. The idea I’m referring to is the insane, but popular, notion that “associations” are somehow endowed with “personhood” above and beyond the normal personhood bestowed on its individual members.
The incorporation of multiple individuals into a viable legal entity constitutes the creation of a “Fictitious Person” for the purpose of executing legal contracts. Corporations are not really persons, however – they’re a legal fiction. They don’t exist outside the realm of business contracts. The Constitution neither sanctions nor forbids the creation of corporations; therefore “fictitious persons” are exempt from any Constitutional consideration. Being outside the jurisdiction of Constitutional law, corporations are therefore free to grant “themselves” whatever rights and privileges they deem most advantageous (profitable). And they did. And their advantages (money) now exceed those of the federal government itself.
Big corporations have come to love our government so much they decided to buy it. They made our government bigger because corporations thrive on bigness and what organization can better administer the Human Resources and Security divisions of a global banking cartel than the up-and-running sovereign infrastructure of a global sea power.
While amateur economic theoreticians follow the money going forward, let us amateur historians follow the money trail back to the origins of the Corporate Beast; just for fun.
The presumably-liberal opinion of Bob Burnett puts it this way in the Huffington Post:
http://www.huffingtonpost.com/bob-burnett/2010-person-of-the-year-t_b_802991.html?utm_source=DailyBrief&utm_campaign=123110&utm_medium=email&utm_content=FeatureTitle&utm_term=Daily+Brief
“In the Citizens United decision Roberts aggressively advanced the conservative agenda along three fronts:
“First, the decision to hear this case was an extraordinary example of judicial activism. Professor Dworkin observed, Citizens United “did not challenge the constitutionality of the Bipartisan Campaign Reform Act.” But the five conservative justices — Chief Justice Roberts, Justices Samuel Alito, Anthony Kennedy, Antonin Scalia, and Clarence Thomas — decided on their own initiative, after a rehearing they themselves called for, that they wanted to declare the act unconstitutional anyway.” [Emphasis added] Justice Kennedy, who wrote the majority opinion, explained that the conservative justices called for the rehearing because they had dissented on the most pertinent precedent, McConnell v. FEC, and had continued to complain about it.
“Second, the Citizens United decision strengthened the conservative contention that corporations have “personhood” and, therefore, enjoy the same rights as ordinary individuals, including the right of free speech. (For a compelling account of how the bizarre notion that corporations enjoy the same constitutional rights as human beings has evolved, see radio host Thom Hartmann’s book, Unequal Protection.)
“Third, the Citizens United decision allowed corporations to spend unlimited funds in political contests. It was this aspect that caused President Obama to observe, during his January 27, 2010, State of the Union Address, “The Supreme Court reversed a century of law that I believe will open the floodgates for special interests — including foreign corporations – -to spend without limit in our elections.” The decision granted corporations more rights than those of human beings.”
- all of which ignores the fact that US citizenship is not required to buy stock in American corporations and foreign corporations can charter banks in the US and sell stock to US investors, simply by filling out the proper paperwork. Multi-national corporations have NO nationality, they’re “citizens of the world” – loyal to nobody but themselves. Any talk of “foreign corporations” is therefore meaningless, because they’re ALL foreign. And contrary to Obama’s observation, SCOTUS only confirmed “a century of law”.(See: Santa Clara County vs Federal Election Commission)
And the presumably-conservative opinion of Bradley Smith in the National Review is:
http://www.nationalreview.com/corner/193894/president-wrong-i-citizens-united-i-case/bradley-smith
“The Court held that 2 U.S.C. Section 441a, which prohibits all corporate political spending, is unconstitutional. Foreign nationals, specifically defined to include foreign corporations, are prohibited from making “a contribution or donation of money or other thing of value, or to make an express or implied promise to make a contribution or donation, in connection with a Federal, State or local election” under 2 U.S.C. Section 441e, which was not at issue in the case. Foreign corporations are also prohibited, under 2 U.S.C. 441e, from making any contribution or donation to any committee of any political party, and they prohibited from making any “expenditure, independent expenditure, or disbursement for an electioneering communication.”
- which also ignores the fact that US citizenship is not required to buy stock in American corporations and foreign corporations can charter banks in the US and sell stock to US investors, simply by filling out the proper paperwork. Multi-national corporations have NO nationality, they’re “citizens of the world” – loyal to nobody but themselves. Any talk of “foreign corporations” is still meaningless, because they’re ALL foreign.
The presumably-unbiased Wikipedia presentation of the case;
http://en.wikipedia.org/wiki/Citizens_United_v._Federal_Election_Commission
contains this passage:
“Justice Scalia joined the opinion of the Court, but wrote a separate concurrence, joined by Justice Alito and by Justice Thomas in part. Scalia addressed Justice Stevens’ dissent, specifically with regard to the notion that the court’s decision was not supported by the original understanding of the First Amendment. Scalia stated that Stevens dissent was “in splendid isolation from the text of the First Amendment. It never shows why “the freedom of speech” that was the right of Englishmen did not include the freedom to speak in association with other individuals, including association in the corporate form.” He further considered the dissent’s exploration of the Framers’ views about the “role of corporations in society” to be misleading, and even if valid, irrelevant to the text. Scalia principally argued that the first amendment was written in “terms of speech, not speakers” and that “Its text offers no foothold for excluding any category of speaker”.”
Which, to me, pinpoints EXACTLY the most important, but as-yet unresolved, issue of the “personhood” of the speaker referred to therein. Our Founders, by omission, left “corporate” legal status dangling in the original Constitution. Our Founders presumably kicked the “corporation” can down the road for consideration by later generations because nobody at the time could foresee the consequences of chartering them into existence. In Citizens United, the SCOTUS decision was obviously based on judicial history and legal precedent; – not economic history. That’s SCOTUS’ job and they did as they were instructed to by the Constitution. OUR job is to provide SCOTUS with a Constitutional Amendment clarifying the definition of “person” as a human being, and “corporation” as a legal fiction by which humans can amass inhuman amounts of capital for infrastructure projects as needed for the Common Good. An appropriate Amendment would mandate uniform and transparent accounting principles be applied to any corporate entity acting as a “fictitious persons” with clearly enumerated prohibitions from participation in the affairs of American adults. Corporate charters should be written to specifically define their status as a public utility , limiting their size and scope to satisfy specific areas of endeavor; – not to micro-manage or limit profitability, but to establish limits. (Good bye TBTF.)
Our Founders weren’t dumb. They debated the issue of economic systems furiously in the Federalist Papers but never reached consensus because the status quo at the time, and the outspoken opinion of Alexander Hamilton (whom nobody liked and fortunately was shot in a duel before he could obligate our fledgling Union to any world trade organizations or interplanetary monetary funds) favored the English version of legalized banking usury. Jefferson, always the dedicated Revolutionary in every sense, thought we could do better than that and fought an up-hill intellectual battle with proponents of the deeply-entrenched European economic model (laissez faire, “free-market”; ……you know; the one that survived slave-revolts). After 200 years of our own economic slavery, with intermittent boom/bust Hamiltonian joy-rides, it might be apropos to re-think some of Jefferson’s egalitarian ideas; to whit:
“If the American People ever allow the banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers occupied. The issuing power of money should be taken from the bankers and restored to Congress and the people to whom it belongs. I sincerely believe the banking institutions having the issuing power of money are more dangerous to liberty than standing armies.
“We are completely saddled and bridled, and the bank is so firmly mounted on us that we must go where they ill guide.
“The dominion which the banking institutions have obtained over the minds of our citizens…must be broken, or it will break us.”
“The incorporation of a bank and the powers assumed by legislation doing so have not, in my opinion, been delegated to the United States by the Constitution. They are not among the powers specially enumerated.”
“The Bank of the United States is one of the most deadly hostility existing, against the principles and form of our Constitution. An institution like this, penetrating by its branches every part of the Union, acting by command and in phalanx, may, in a critical moment, upset the government. I deem no government safe which is under the vassalage of any self-constituted authorities, or any other authority than that of the nation, or its regular functionaries. What an obstruction could not this bank of the United States, with all its branch banks, be in time of war! It might dictate to us the peace we should accept, or withdraw its aids. Ought we then to give further growth to an institution so powerful, so hostile?”
and the ever-so-timely:
“Certainly no nation ever before abandoned to the avarice and jugglings of private individuals to regulate according to their own interests, the quantum of circulating medium for the nation — to inflate, by deluges of paper, the nominal prices of property, and then to buy up that property at pennies to the pound, having first withdrawn the floating medium which might endanger a competition in purchase. Yet this is what has been done, and will be done, unless stayed by the protecting hand of the legislature. The evil has been produced by the error of their sanction of this ruinous machinery of banks; and justice, wisdom, duty, all require that they should interpose and arrest it before the schemes of plunder and spoilation desolate the country.” –Thomas Jefferson to William C. Rives in 1819
By way of contrasting opinion, I quote Alexander Hamilton:
“In the general course of human nature, A power over a man’s subsistence amounts to a power over his will.”
“The voice of the people has been said to be the voice of God; and, however generally this maxim has been quoted and believed, it is not true to fact. The people are turbulent and changing, they seldom judge or determine right.”
“A national debt, if it is not excessive, will be to us a national blessing.”
I rest my case.
Catherine Austin Fitts summarizes the reality of our economic system better than anyone I’ve heard to date. It’s just one more reason to turn off your TV and tune in to what’s really going on right before your eyes.
http://www.realecontv.com/videos/post-collapse/re-wiring-the-financial-system.html
The only thing I would add is a follow-up to her observation that corporations now constitute an entirely independent shadow government with financial sovereignty over our “nominal” government:
Corporations that are permitted to write their own Corporate Charters are not going to be nearly as democratic as corporations whose Charters were written by We, The People.
The only way we’ll ever restore trust in government is to pigeonhole all corporate entities doing business in the USA , especially banks, into a conceptual box labeled “Public Utility – for the common good”.
If corporate charters were written by adults (ie: un-sponsored congressmen) we wouldn’t have these self-destructive financial shenanigans going on. Congressionally-authored corporate charters should start with “getting real” about “personhood”.
We desperately need to de-centralize monetary power and get it back in the hands of the VOTER. Regulation doesn’t work. We’ve proven that again and again. We have to define WHAT these corporations ARE. Only then can we regulate them in terms of their desired function in society.
It’s way past time for an Art. 5 Constitutional Convention. Why aren’t we party-ing?
William,
This video certainly lays out the symptoms of our current malaise in admirable detail. But it also reveals the conundrum that I discussed with you some little while back…the one that Madison pointed to as a central dilemma of human society and its governments.
Ms. Fitts points to ‘transparancy’ as a possible solution to the widespread corruption infecting our current society. But just a few minutes earlier she related how, when giving a speech to a group of people whose mission it was to seek spiritual improvement, that she had revealed to them the vast amounts of illicit drug money being laundered through many of our major financial institutions. And when she asked this group if they would put an end to this illegal and socially deleterious activity, if they could, by pushing a button, only one person raised his or her hand. When Ms. Fitts asked the audience why they would choose not to end this criminal activity, they told her they thought ending the money laundering necessary to the drug trade might adversely effect their finances. And this is a group professing to be spiritual seekers.
So here is a dramatic illustration of what I was attempting to convey to you in some of my earlier posts. The transparancy was certainly there in the situation just described, as Ms. Fitts acquainted her audience with the facts of the matter, but virtually all of the seekers of enlightenment in question would choose to ignore illegal and immoral activities if it served their selfish interests.
What good is it to pass new laws and reconfigure the legal landscape when the people themselves would have no compunction about ignoring these arrangements when it suited their selfish interests. Wouldn’t the manipulation of legal externalities simply amount to putting lipstick on a pig? How can we hope to build a moral society made up of immoral citizens? The problem that we face is not a legal one and will not be solved by legal manipulation. It is a moral problem that we face. How do we deal with this reality?
Backatcha Tim:
There are a whole big bunch of possible reasons a bunch of spiritual seekers would condone the laundering of drug money by financial institutions: 1, they’re Libertarians and don’t see it as their “business” to interfere in the folly of druggies, their dealers, or the banks that deal with them; 2, drug use is not a spiritual issue but a health issue, and none of their business; 3, laundering money is a moral issue for the banks only if the banks think drug use is immoral regardless of illegality; 4, they might think drugs are cool – they’re not psychologists, they’re spiritualists; 5, they might think that imposing their beliefs on anyone else by force is, in itself, immoral; 6, they might think their money, however ill-begotten, is better spent by themselves in the promotion of spirituality.
As to how we build a moral society; I don’t know – define morality. I thought the object of the Constitution was to create a FREE society, in which one could pursue life, liberty, etc. so long as it didn’t infringe someone else’s right to the same. I don’t remember the Constitution saying anything about the DEA, or banks’ obligation to question the source of deposits.
The audience in question was probably making a statement about the spiritual immorality of victimless crimes and decided they didn’t want to be financially victimized by government any more than they already were by the IRS.
It is a *moralistic-government* problem that we face; and the solution is to join our spiritual brethren at the Evangelical Church of the Blessed T. Jefferson…………………… ………………………..ya’ll sing along now;
“A wise and frugal government,
which shall leave men free
to regulate their own pursuits
of industry and Improvement,
and shall not take from the mouth of labor
the bread it has earned –
this is the sum of good government. “
Thomas Jefferson
William,
I think that Mr. Jefferson, and all honest people, know that the Constitution and the laws to flow from it presume a moral basis. After all, law presumably flows from a set of values, i.e., a moral code. When the people in question readily admit that their prime consideration for not being concerned about gaining from illicit drug profits is financial self interest, it seems to me more than just a little disingenuous on your part to hang the fig leaf of ‘libertarianism’ over their deeds. After all, it is one thing to let others act self-destructively and entirely another thing to profit by their misfortune.
What is morality? Well, the philosopher Kant defined immorality as treating others as means rather than ends. In other words exploiting others for your own self interest. I think Jefferson, who despised the exploitation of men by their fellow men, would have no problem with Kant’s definition. By your reasoning one should not at all be concerned by the banksters putting so many in debt, as it is not your business if other people want go into debt, or, for that matter remain ignorant of how they are being exploited.
Actually, there are many who use debt knowing full well that it is inflationary and does financial harm to their neighbors. The wealth of savers is confiscated by borrowers and lenders due to our inflationary credit system. But, hey, it’s legal. Why not take advantage of a little leverage. Am I my brother’s keeper? Hell no, I’m a libertarian and that excuses me from any such troublesome notions as morality.
I am sending you a link to a video of a talk given at Yale recently in which the speaker documents the massive cooperation given to the Nazis during WW II by the citizens of various occupied countries. He makes the point that the Nazis had to do very little of the inhumane dirty work in many instances as there were so many locals willing to do it for them in order to personally profit. Perhaps this example speaks more to my point.
Do you really believe that a just society can be constructed by people without moral conviction? And as for what is morality in a positive sense, how about, “Love thy neighbor as thyself”. All great spiritual teachers have professed this principle. It seems abundantly clear to me that only when this principle of brotherly love is put into practice will we achieve the world we long for, and not one second before. Without love all the laws that can be written are in vain. And all talk of reform is just a clanging cymbal.
“All you need is love.” — John Lennon
If you’re interested, William, here’s that link.
http://www.brasschecktv.com/page/999.html
Tim, Tim, Tim; your nanny-state deviations are killing me.
First of all; the Constitution and the laws to flow from it presume a legal basis, not a moral basis. If the states have a moral basis, that’s their Constitutional right, not the Federal government’s, to enact.
Secondly; one should be VERY concerned by the banksters’ putting so many in debt if they do so by fraudulently misleading consumers to believe values could never decline and interest would remain the same. That’s theft by fraud and deprives the victim of his right to life, liberty, etc. Likewise, drug dealers, by misrepresenting their product, are guilty of fraud and should be prosecuted for that. It is the prosecution of the victims that I find morally objectionable. In the case of Ms Fitts informal poll 99 out of 100 spiritualists agreed they didn’t want to be penalized for the crimes of criminals they never met. I don’t know if the spirituals in question interpreted the red light to mean stopping the initial drug sales, or the stopping of drug money deposits, or stopping the loss to their bank accounts. In any case it’s immaterial to the issue of Constitutionality and why shouldn’t they profit from others’ own self-destruction, so long as they’re not destroying the ignorant bastards themselves?
Thirdly; mortgage lenders and Nazi sympathizers have a lot in common: it’s only a matter of price. I, personally, only worked for a corporation for a short time, in my youth, and have been self-employed or worked for sole proprietors ever since. I regard corporate employment as slavery and refuse to participate. If everybody felt the same we wouldn’t be having this discussion, would we.
Hugo Chavez is busy building a “just” society right now; care to join him? Or would you rather decide what’s “just” for a society?
I’ll settle for a free society. Just throw in a pinch of sanity regarding the status of fictitious persons within it. Free men will find love all around them; slaves can’t respect themselves, much less love another. BTW: I love you. You make me laugh sometimes but you make me think, too.
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William,
Don’t you find it just a tad ironic that you would refer to my “nanny state deviations” when the whole thrust of my argument has been against the apotheosis of states and laws and has been directed to the morality of the individuals who create and support these man-made concepts? But, of course, we see here a rather bald example of what students of disputation call the setting up of a ‘straw man’, wherein the person employing said technique substitutes an argument that was never made and thus evades the argument that was made.
Next you tell us that the Constitution, which is a legal document, presumes a legal basis. So you are saying that the basis for law is law itself? The reason that we state laws is that we state laws? The cause of a phenomenon is the phenomenon itself? Really? Does not the concept of a cause or basis presume prior, actuating conditions?
Pardon me for my ignorance, but it has always been my distinct impression that laws, be they those stated in the Ten Commandments of Moses or the Constitution of the United States, are the encoding of certain moral precepts. Many of these precepts can be found in both of the documents just mentioned. Obviously, such proscriptions as “Thou shalt not steal”, “Thou shalt not kill”, and “Thou shalt not bear false witness” are part and parcel to the principles contained in the Constitution which seeks to restrain these immoral encroachments of man upon man and to promote mutual respect…in short, caring for your neighbor as you would for yourself.
The need to provide justification for the legal pronouncements of the Constitution and a basis for it is evidenced by the use of such ideas as ‘self-evident truths’, borrowed by Jefferson from Euclid, and God-given rights, i.e., “endowed by their creator with certain inalienable rights…”, also borrowed by Jefferson – this time from our Judeo-Christian heritage, as opposed to our Greek heritage as in the case of Euclid. The founders, such as Jefferson, were well-read and steeped in these two major cultural streams, the Greek and the Hebrew, flowing into the river of western culture. And they realized that the the Constitution of the government they were about to create must be founded upon accepted moral principles rooted in their shared cultural experience. To simply say that this document we are writing is legal and will be implemented by the force of government, which we are also creating, because we, who are men just like you, say so, would have been slightly lacking in authority and the drafters of the document, being intelligent men, certainly knew this, even if you don’t.
And finally, how am I to understand a man who discounts the idea of morality and at the same time thunders on about the many things he believes should or should not be. Morality and ethics are the fields of thought that deal with the shoulds and oughts or the should-nots and ought-nots in life. And, William, your posts to this blog are all about the shoulds and oughts as you see them. When you rail against theft and fraud and speak about what one should do, as you do in your latest post, you are moralizing, whether you want to admit it or not.
If you are going to reply to me that you are only concerned with what is legal and not what is moral, I must reply to you that most of what Hitler did while in power was done with legal sanction, while most of what the founders of the United States did in overthrowing their own British government was illegal. The founders revolted against the law of their land because they felt the law, as it stood, was immoral and they sought to replace the existing law and government with a new law and government that was, in their eyes, moral. They, like you and I, were moralists. If you have any notions at all as to what might be right or wrong, you are, by definition, a moralist.
I must confess, William, I find it very tedious having to explain to you things that are so basic only to be responded to with the sorts of specious sophistries you have been offering up. You seem to be an intelligent man and this inclines me to believe that perhaps you are being less than candid with me in our discussions. Is it perhaps that winning an argument is more important to you than an open search for truth? Only you can know that. As for me, I must move on, as I have come to see the futility of further dialog between us.
I wish you well.
Tim; you got all that from one paragraph?
Not to be deterred; there IS a place for morality in society, but not the sort morality that flows down from federal authority but the sort that percolates up from the roots of society. I’m out of my league here engaging in philosophical debate but the mechanic in me finds it impossible to produce a one-size-fits-all model of moral society that lends itself to bureaucratic administration. If the Federal government were to try defining morality in terms of the absolutes you’re referring to, the machinery of government would absolutely lock up.
Just for instance: “Thou shalt not kill.” While it might work for some classes of conscientious objectors, it won’t work if you have a Hitler at the gates. So it would have to be moral for soldiers, but immoral for everyone else. That’s a cheap shot, I know; but I hope you get the idea. It’s just not that simple.
In my original post I was operating in a head-space context of de-centralizing the corporate nature of our entire economy without bombing every damn factory they ever built. Again, I’m trying to construct a new economic system based on the moral value of RESPONSIBILITY. We can’t demand morality from our corporations because, being fictitious persons, they have no more idea what morality is than they know what mortality is. As they currently exist, their only moral obligation is to serve the “stockholder” by making money. To make a corporation act morally would require the government (us) to micro-manage every day-to-day operating decision at every level with prohibitive tons of regulatory rules. So, since fictitious persons have no moral compass, the only practical solution would be to carefully craft a corporate charter with 10, 100, or 1,000 Commandments and “Thou shalt not’s” to substitute for our humanely intuitive sense of right and wrong. Yes ! An entirely artificial, man-made, fictitious morality code written specifically for fictitious persons.
Employees of all corporations would subsequently be obligated by law to observe the provisions of their corporations’ charter. Joe Worker could no longer say “I was only following orders from above.” Management and workers alike would be subject to the same moral code, and that fictitious code would demand no more nor less than that of real citizens. Penalties for fraudulent acts would apply equally and corporate employees could be individually prosecuted as easily as individual con men.
I think the imposition of a fictitious moral code on fictitious persons would do a lot to restore our innate sense of morality and unity as a culture. And again, without throwing out the baby with the bath water.
So yes, I really AM for morality, but it has to be applied sparingly and in the right places. Each application according to the NATURE of the corporation and its function as a public utility.
Sorry I can’t write more plainly, please try to follow the logic and point out ways to say it better without condemning me as as a libertine. I’m only trying to design a workable ECONOMY.
William,
Again, we seem to be talking past one another. You keep talking about ‘governments’ and I keep talking about people. Let me try taking a different tack by simply saying that there is no such thing as a ‘government’. Yes, that’s what I said – there’s no such thing as a government. You say, “Whoa, hold on there. What the hell are you talking about?” And I say, “If there is such a thing as a government, then point to it and show it to me”. You can’t point to anything that is a government. You can point to pieces of paper that men have written words on and called a constitution, you can point to a piece of cloth called a flag, you can point to buildings that men have built and called ‘government buildings’, but you cannot point to a government, because a government is not a thing like a person, but is only an idea within the mind of a person. It is a concept or a myth.
But the tendency is to reify our myths, which is to say we treat them as if they were real things. This phenomenon of treating ideas as if they were real objective things is known to philosophers as the fallacy of ‘reification’. It is the same with corporations, which are even defined as ‘legal fictions’.
So we conjure up these notions such as governments and corporations and then go about treating them as if they were real objective things existing outside of ourselves. Some folks, like patriotic flag-worshippers, even worship these man-made notions. This, of course, is the very definition of idolatry, which is the worship of our own creations.
But the simple truth, William, is that these ideas are simply conjurings of our own imaginations and it is only we, as ‘people’ who think, act, and will. It is utter nonsense to talk about ‘governments’ or ‘corporations’ acting, willing, or being moral. Only we the people can do these things. We simply delude ourselves when we seek to evade personal responsibility by placing that resposibility on an imaginary scapegoat that we call goverment or corporation. It’s a bit like saying, “The devil did it”.
So we create these imaginary entities we call governments and corporations and agree that they should have such powers that we as individuals do not possess, such as using force against our neighbors and evading personal liability, and then pretend to be surprised when various individuals use these powers for their own selfish purposes.
But, to reiterate, there are no such things as governments. Goverments are not things but ideas issuing from the minds of and exploited by people. It’s just us people, William. And that’s why it all boils down to personal morality and responsibility. Governments can’t act morally because they are not willing, acting entities, but simply our own ideas. It is only we, the people, who can act morally or immorally. And I can only decide for myself to act morally. I cannot decide whether or not you or anybody else acts morally. It is folly to imagine that governments can either act morally themselves or cause people to act morally. Only people can act or be at cause. N’est-ce pas?
Possibly more relevant to the debunking of the money is a new term I picked up in The Daily Bell; http://www.thedailybell.com/
refering to the “Anglosphere” in reference to international banking, I assume they’re referring to the central banks of US, Japan, EU, UK, etc. as opposed to the central banks of two BRIC economies, Russia and China, whom recently took steps to divorce themselves from the Anglosphere’s death-spiraling-collapse by bypassing dollars as their own bilateral medium of exchange; thereby hedging against the dollar’s potential defunctability. See:
http://www.commodityonline.com/news/China-Russia-trade-agreement-End-of-Dollar-era-34036-3-1.html
Also; there’s a great video eulogizing the American Dream at:
http://www.youtube.com/user/theamericandreamfilm
that’s worth checking out.
This blog has some decent conversations. I’d like to add a few names to to list of people who need our voices and actions of support.
Tom Linzey is an attorney that is involved in some great things.
http://activism101.ning.com/profiles/blogs/interview-with-environmental
“Thomas Linzey, the CELDF democracy school organizer who helped the Ecuadorian people write rights for nature into their Constitution and ran the Spokane Community Bill of Rights Ballot Initiative last November has a new book out about the Democracy School process called Be The Change: How to Get What You Want in Your Community. I continue to believe Thomas is one of the most inspirational and potentially powerful community activists in the world.”
Chris Hedges
William K. Black
Lawrence Lessig
George Lakoff
Naomi Klein
Russ Feingold
Bernie Sanders