Can’t Get Ahead, Hard To Keep Up

A New Poll Finds Americans Feeling a Lot More Squeezed

By Michael A. Fletcher, Washington Post:

Offering the gloomiest assessment of economic well-being in close to half a century, a new survey has found that most Americans say they have not made progress over the past five years as their incomes have stagnated and they have increasingly borrowed money to finance their lifestyles.

As many Americans struggle with declining housing values, increasing food and energy prices and growing unemployment after a long period of flat wages, well over half of respondents said they are either losing ground economically or are stuck in the same place, according to the report released yesterday by the Pew Research Center. Only four in 10 said they have moved forward in the past five years — a record low, Pew says, and far off the record 57 percent who in 1997 said they had moved forward in the previous five years.

The squeeze is particularly tight for those who have low incomes and for the 53 percent of Americans who classify themselves as middle-class. Nearly four out of five middle-class adults say it is more difficult for people like them to maintain their standard of living. In 1986, fewer than two of three middle-class people shared that opinion.

Only two in five middle-class Americans say they “live comfortably,” while one in five says he is just able to meet expenses. The others say they are able to meet expenses with some money left over. Overall, slightly more than half said they had to “tighten their belts” to adjust to the increasing economic pressure.

“Everything is going up, and our incomes are not,” said Lorraine Conrad, 77, a Virginia Beach widow who lives on Social Security and her husband’s military survivor benefits. “I am able to get by, but I have to be really careful about how I spend my money.”

The Pew report, based on a telephone survey of a nationally representative sample of 2,413 adults taken from Jan. 24 to Feb. 19 and overlaid with demographic information from the Census Bureau, adds new information about how Americans feel about their economic situations in the midst of a presidential campaign in which the plight of the middle class has been at the heart of the debate. Democratic candidates Hillary Rodham Clinton and Barack Obama have argued that ordinary Americans are slipping backward economically. The two have proposed expanding health-care coverage, increasing financial aid for college students and cutting taxes for the middle class. Presumptive Republican presidential nominee John McCain also has promised to cut taxes for the middle class and to expand the availability of health care through tax incentives.

Even as they struggle, however, nearly two-thirds of Americans say they are better off than their parents were when they were their age, an important marker of upward mobility. That fulfillment of the American dream has persevered as the nation has entered a period of widening income disparities and creeping insecurity brought on by the rise in income volatility, the decline in fixed-benefit pensions and the increasing need for households to send two breadwinners to work to maintain a middle-class life.

“Most Americans see in the sweep of their lives a long arc of progress,” the report said. “Most expect to face some belt-tightening — or worse — in the coming year, but a majority is confident that their quality of life in five years will be significantly better than it is now. And, gazing into a more distant future, most expect their children’s standard of living to be better than their own.”

Median household income increased 41 percent from 1970 to 2006, though it never returned to its 1999 peak. Seven in 10 survey respondents said they have cable or satellite television as well as two or more cars. Two-thirds reported having high-speed Internet service, and 42 percent said they have a high-definition or flat-screen television, the report said, adding that the typical house is 50 percent larger and nearly twice as expensive now as it was in the mid-1980s.

But those luxuries have come at a price, as middle-class households are assuming more risk and borrowing more than ever before. Debt-to-income ratios more than doubled from 1983 to 2004, going from 0.45 to 1.19, the report said, as more families leveraged their lifestyle with larger mortgages, home-equity loans to pay down other bills and larger college loans to keep up with soaring tuition.

At the same time, more Americans have managed to move up the income ladder, particularly as they approach middle age. From 1970 to 2006, the share of Americans whose income was 75 to 150 percent of the national median contracted to 35 percent from 40 percent. But the percentage of people earning more than 150 percent of the median ticked upward from 28 to 32. The proportion of the lowest income group also grew, from 31 to 33 percent, led by a sharp increase in the number of young people, aged 18 to 29, who are lower-income.

Americans are also wealthier than ever, with the median net worth of middle-income families peaking at $98,286 in 2004, up from $77,031 in 1992. That growth has been most impressive for families in the upper-income group, who had a median net worth of $439,390 in 2004, nearly double the figure of 12 years earlier. But some of that wealth has likely eroded with the recent downturn in housing prices.

Among the groups to substantially improve their economic standing since 1970 are senior citizens, native-born Hispanics, African Americans and married couples, the report said. Meanwhile, single men and people with high school diplomas or less and immigrant Hispanics are among those who have lost ground.

Those surveyed agree that it is harder to maintain a middle-class lifestyle, but they do not agree on whom to blame for their plight. About one-quarter blame the government, 15 percent blame the rising price of oil, 11 percent blame themselves and 8 percent blame foreign competition.

“Part of it is the natural cycle,” said Vicki Cool, 61, a retired nurse who lives in Salisbury, Md., and worries whether the Social Security payments she receives as a surviving spouse and her savings will keep her afloat through retirement. “Everybody wants to point a finger. But I’m not sure that I know enough to point fingers. I just know it’s unfortunate.”

FLASHBACK: Jeb, Marvin & Neil – 3 Profiteering Bush Brothers

Source: Evelyn Pringle, Scoop:

It’s time to take a closer look at First Brothers, Jeb, Neil, and Marvin Bush, and see how much they stand to benefit from W’s presidency and his perpetual war on the world.

First, there’s brother Marvin. He’s the quietest member of the Bush clan. Marvin is co-founder and partner in Winston Partners, a private investment firm. In turn, Winston Partners is part of a larger firm called the Chatterjee Group.

Here’s where it gets complicated. Marvin is obviously the family member with a sound criminal mind. He has managed to bury almost all the evidence of his profiteering profits inside a host of corporations and entities, with many being located offshore. Its not easy to track the money through such a tangled web. But it can be done.

SEC filings show that the Chatterjee Group consists of Winston Partners, LP; Chatterjee Fund Management, LP; Winston Partners II LDC, a Cayman Islands-based company; Winston Partners II LLC; Chatterjee Advisors LLC; Chatterjee Management Company; Mr. Chatterjee himself; and Furxedown Trading Limited, a company organized under the laws of the Isle of Man. The address for Winston Partners II LDC is in the Netherlands Antilles. The other subsidiaries were organized in Delaware

Marvin is not the only family member plugged into the group. Brother Jeb is also an investor in the Winston Capital Fund, which happens to be managed by Marvin’s firm.

Profits From Iraq

Following the tangled web of Winston this and Winston that, is difficult in itself, but tracing the links to Iraq is even more difficult. A good place to start is with a company known as Nour USA. According to the Sept 30, 2003, issue of Mother Jones, an $80 million Iraq contract was awarded to Nour, a company with ties to Winston Partners.

Nour set up shop in May 2003, right in time to cash in on the war in Iraq. When it opened for business, the firm’s website described the company as an “international investment and development company” with more than 100 employees based in Iraq, and listed expertise in telecommunications, agribusiness, internet development, recruitment, construction materials, oil and power services, pharmaceuticals and fashion apparel.”

Nour had ties to several companies, backed or owned, by Marvin’s Winston Partners, including Hobart West, a Fortune 500 personnel-services company; LogoTel, a clothing company; and Axolotl, a computer-services company in medical care.

In January, 2004, Nour was awarded another contract, worth a whopping $327 million, to equip the Iraqi armed forces and Civil Defense Corps. However, not long after it was awarded, Nour came under heavy scrutiny because of a financial scam involving the company’s president and Ahmed Chalabi, the leader of the US appointed Iraqi Governing Council (the neocon’s all time favorite fellow until they booted him out of the club).

Newsday reported that Chalabi received a $2 million “fee” for helping to arrange a $80 million contract, that was actually awarded to a firm called Erinys International to begin with. The problem arose, according to Newsday, because “within days” of being granted the contract, Erinys became a joint venture operation with Nour.

Next, the $327 million contract came under investigation after it was revealed that Nour had no prior experience whatsoever in providing military equipment. When confronted with that fact, Nour claimed that it planned to subcontract its weapons procurement to the Polish firm, Ostrowski Arms. However, the army soon determined that Ostrowski didn’t even have a license to export weapons.

Soon thereafter in March 2004, there was a sad turn of events for the First Brothers, when the Army decided to terminate the contract after six of the 17 firms that bid on the project, complained that Nour’s winning bid was ridiculously low.

It seems a review of all bids revealed that some bids were as much as $700 million apart. “That was a pretty clear indication that the industry did not have a good understanding of the procurement,” said an Army official.

During a House Government Reform Committee hearing on Iraq contracts on March 11, 2004, some members of Congress tried to raise questions about private connections behind some of the contracts. However, committee Chairman Tom Davis, (R-Va), cut off the questions before the witnesses could answer.

But at least the Bush gang lost control of the profits from the next contract. The first Nour contract was awarded by Bremer and the CPA in Baghdad, but the process of re-bidding was turned over to the Army Material Command.

Iraq Not Sole Source Of Profits

But not to worry, the First Brothers profits are by no means limited to Iraq. They have irons in the fire all over the map.

For instance, Winston Partners’ portfolio includes another military contractor, the Amsec Corp. In 2001, Amsec was awarded $37,722,000 in contracts from the Navy. Marvin’s long-time business partner, Scott Andrews, sits on the Amsec board of directors, and the firm’s CEO in the relevant time-frame was Michael Braham, who used to work for none other than Paul Bremer, the top dog with the Coalition Provisional Authority (CPA), which was then responsible for awarding contracts in Iraq.

In addition, the Chatterjee Group also owns 5.5 million shares in a security company known as Sybase. SEC filings show the shares as being divided up between, Winston Partners LP with 1,036,075 shares; Winston Partners LDC holding 1,317,825 shares; and Winston Partners LLC owning 1,221,837 shares.

And thanks to brother George W, there would be plenty of profits for this security company. Obviously armed with insider knowledge from the White House, Sybase geared up to make big money off the Patriot Act long before it was passed.

The Act was designed in part, to prevent money laundering by terrorists. As soon as news of the pending law became public, all kinds of companies began developing new products that would soon to be a requirement for financial institutions that had to comply with the Patriot Act.

However, to no one’s surprise I’m sure, the most aggressive marketer out of the box, was probably Sybase, with a product called the “Sybase PATRIOT Compliance Solution.” In fact, the company was so quick on the draw that it already had a deal with the People’s Bank of China, and the Sumitomo Mitsui Bank, by the time the October 2002 compliance deadline rolled around.

Which proves there’s much to be said for benefits derived from a direct link to information about what the US government is up to and how much it plans to spend.

In addition, according to Progressive Populist, the PATRIOT Act is not Sybase’s only federal conduit. The company is also a significant government contractor, with contracts from the Agriculture Department, the Navy ($2.9 million in 2001), the Army ($1.8 million in 2001), the Department of Defense ($5.3 million in 2001), Commerce, the Treasury and the General Services Administration, among others. The federal procurement database lists Sybase’s total awards for 2001 as $14,754,000.

But then, making money off wars in the Middle East is nothing new for Marvin. Back in 1993, after the first gulf war, he joined his father (3 months out of office), on a trip to Kuwait. Where, according to the March 16, 2001 Austin Chronicle, “Marvin was representing U.S. defense firms selling electronic fences to the Kuwaiti Defense Ministry.”

From 1993 to 2000, Marvin was also a major shareholder in the Kuwait-American Corp, which had holdings in a wide variety of US defense, aviation and industrial security companies.

No doubt about it, W’s perpetual war on terror, is very profitable for the Bush Boys.

Almost Forgot Romeo

How could I ever forget little brother Neil? Until recently, he was best-known for his role in the collapse of the Silverado Savings and Loan which left a bill of $1.3 billion for tax payers to repay, as the culprit, Neil, walked away without ever seeing the inside of a police station, much less a jail cell.

I say until recently because last year, his testimony in a divorce deposition revealed a $2 million consultant contract between Neil and a Chinese computer chip company, which apparently came with perks consisting of women showing up at his motel room door wanting to have sex.

I’ve since nicknamed him Romeo.

But all kidding aside, the guy has really come along way since the Silverado days, thanks to his brother in the White House. According to the Nov 28, 2003, Financial Times, “Neil Bush, a younger brother of US President … has had a $60,000-a-year employment contract with a top adviser to a Washington-based consulting firm set up this year to help companies secure contracts in Iraq,” it reported.

Neil disclosed the contract during the deposition. He said he was co-chairman of Crest Investment Corporation and received $15,000 every three months for working an average three or four hours a week.

The Times went on to report, “The other co-chairman and principal of Crest is Jamal Daniel, who is an advisory board member of New Bridge Strategies, a company set up this year by a group of businessmen with close links to the Bush family or administrations. Its chairman is Joe Allbaugh, George W. Bush’s campaign director in the 2000 presidential elections.”

On December 11, 2003, the Times reported that “two businessmen instrumental in setting up New Bridge Strategies, a … firm designed to help clients win contracts in Iraq, have previously used an association with Neil, the younger brother of President Bush, to seek business in the Middle East,” an FT investigation has found.

Daniel’s investment fund, Crest, also helped fund Neil’s educational software company, Ignite!, which was no doubt set up as a conduit to funnel tax dollars through public schools via W’s No Child Left Behind Act. In fact, according to the Times, Daniel sometimes introduces himself as a founding backer of Bush’s company, and has persuaded the families of prominent leaders in Middle East to invest, it notes.

Daniel, Neil and Howland have also been directors of Silvermat, a Swiss company controlled by Crest, that supplies the hospitality industry and has had financial and industrial relations problems.

When asked the specifics of his position with Crest, Neil testified that he was responsible for “answering phone calls when Jamal Daniel, the other co-chairman, when he called and asked for advice.”

However, Neil’s is not merely a receptionist at Crest. He can obviously type as well, because three people contacted by the Financial Times have seen letters written by Neil that recommend business ventures promoted by New Bridges in the Middle East. So here again, we have Brother Neil being paid to “help companies secure contracts in Iraq,” the Financial Times reports.

Neil & Marvin Hit The Jackpot In China

On still another front, many people were alarmed when W came down in favor of the People’s Republic of China, against a democratic referendum in Taiwan. But his support of China became suspect after it was discovered that well-connected Chinese firms were funneling huge amounts of money to his brothers, Neil and Marvin, according to Margie Burn in the Dec 16, 2003 Online Journal.

Soon after Neil’s deposition, the media began reporting that the computer chip company, Grace Semiconductor had entered into a $2 million contract with Neil.

The world business press reported that by hiring Neil, Grace hoped to influence US limits on exporting technology to China and repeal restrictions designed to keep gear from being used by the Chinese military.

And who knows, Neil may have come through, because on Oct 29, 2004, Electronic Engineering Times, reported that Grace was in the final stages of negotiating a technology transfer for a manufacturing process from a US manufacturer, which if “brought about … would signal the further erosion of a post-Cold War-era pact – known as the Wassenaar Arrangement – set up to limit the dissemination of technology that could have potential military use.”

The Wassenaar Arrangement is a real headache for Grace because in order to make advanced semiconductors, it has to rely on imports that require prior approval. So exactly who is this US manufacturer, and what, if any, connections does it have to Neil Bush? According to EET, Grace refuses to disclose the name of the company, which leads me to wonder why the secrecy, and as usual where is the US media?

Of course EET had to remind the world of the connection between Neil and his foreign buddies, and that he was paid $2 mill. “In the U.S., it has reportedly agreed to pay $2 million for consulting services from semiconductor neophyte Neil Bush, the younger brother of President George W. Bush. In China, one of Grace’s founders is Jiang Mianheng, the son of former Chinese President Jiang Zemin, and in Taiwan, its other founder is Winston Wang, scion of a powerful petrochemical magnate.

This deal would have never been disclosed if not for Neil’s divorce. But while everybody was paying attention to Neil, an even bigger Chinese company was making deals that would benefit that quiet little mouse Marvin, and almost nobody noticed.

Cheung Kong Holdings, is a gigantic real estate and investment company in Hong Kong. How big is it? Well, according to the company’s own estimates, “combined market capitalization of the Cheung Kong Group amounts to HK$515 billion,” or better yet picture this, “approximately 11.5 percent of the total market capitalization of the Hong Kong stock market.” That is big with a capital B.

Cheung Kong’s expanded its portfolio, which now includes a company known as Critical Path, Inc, a software and Internet-messaging service firm. And guess who the company’s SEC filings list as a major shareholder in Critical Path? Mr Purnendu Chatterjee, acting for Winston Partners LP, owned by none other than Marvin Bush and Scott Andrews.

SEC filings show the Chatterjee’s group, including Winston Partners, owns approximately 5.5 million shares in the company. Which means, Cheung Kong’s investment had to boost profits for Winston Partners.

Thanks to the US Media, and to the fact that none of the Bush brothers are named Roger Clinton, few Americans seem to know about these deals. But the international business community sure does. Cheung Kong and Grace are both major players in China’s entangled economy made up of public and private partnerships.

For W to allow his brothers to profit from deals with these firms is bad enough. But to follow up with a major shift of support to China, and discourage a democratic referendum in Taiwan, is worse. The whole world cannot help but view this turn of events as one big Bush payoff.

Whenever I write about the profiteering First Family, I like to remind readers of what Bush told reporters when the Clinton pardon scandal hit the headlines with charges that brother-in-law Hugh Rodham had accepted $400,000 to lobby for clemency for two felons. When reporters asked George W what advice he would give to his own family members, he said: “My guidance to them is, ‘Behave yourself.’ And they will.”

Yea right.

—

Evelyn Pringle is a columnist for Independent Media TV and an investigative journalist focused on exposing corruption in government.

The brave librarians who resisted FBI subpoenas

Another reason why I *heart* librarians.

By Luella N. Brien, BIllings Gazette:

Two Connecticut librarians who became uncommon champions for civil liberties will present their unlikely story today in Billings.

In 2005, Peter Chase and George Christian, along with two other Library Connection librarians in that state, were served National Security Letters by the FBI. The letters, a form of subpoena, requested personal information from a library patron and sought records of all borrowed reading material and Internet usage. The librarians decided not to comply.

National Security Letters have been around for years but were rarely used until recent years, said Lex Hames, communications director with the American Civil Liberties Union in Montana. He said their power was enhanced with the passage of the Patriot Act in 2001.

The act includes a provision that expanded FBI authority to demand records without court approval and to prohibit recipients of National Security Letters from letting anyone know about the demand.

“It goes toward all the things wrong with allowing law enforcement to operate in secret and unconstitutionally without safeguards,” Christian said.

That the librarians simply talked to each other about the letters they received could have been considered illegal. The letters come with a lifetime gag order, and breaking the gag order could result in a five-year federal prison sentence.

“Librarians have a professional commitment to the First Amendment,” Christian said. “We will always resist the infringement of the First Amendment. It’s our professional ethos.”

The librarians enlisted the help of the ACLU and took the matter to a federal court, arguing that the gag order was unconstitutional.

The judge ruled in favor of the librarians, but the letters were still valid.

The FBI decided not to pursue the investigation into the library patron, and the librarians have since been sharing their tale with other Americans.

“It’s important to share our story because of the secrecy,” Christian said. “There are so many other people who can’t talk about the letters they received. It remains a secret until the day they die.”

The U.S. Department of Justice reported last year that least 150,000 letters have been served.

The ACLU contends that 300,000 letters have been served.

“That’s 300,000 people who can never speak about it,” Hames said. “These four librarians are the only ones who can even say they received letters.”

The librarians, collectively known as John Doe in their lawsuit, couldn’t be associated with the case because it could be considered a violation of the gag order.

They watched their fate play out on a closed-circuit television 50 miles from the courthouse, Hames said.

They had to meet with their lawyers in secret and couldn’t discuss the ordeal with anyone except their lawyers.

“You don’t really think of librarians out against the barricades protesting,” Hames said. “These four men were facing prison time, and they were very brave in a quiet way.”

Graffiti artist Banksy pulls off most audacious stunt to date – despite being watched by CCTV

Source: The Daily Mail.

Banksy pulled off an audacious stunt to produce what is believed to be his biggest work yet in central London.

The secretive graffiti artist managed to erect three storeys of scaffolding behind a security fence despite being watched by a CCTV camera.

Then, during darkness and hidden behind a sheet of polythene, he painted this comment on ‘Big Brother’ society.

©SPLASH

‘One nation under CCTV’: CCTV (pictured top right) failed to catch Banksy

Yesterday the scaffolding gang returned to remove all evidence – again without the camera operator stopping them.

The work, above a Post Office yard in Newman Street near Oxford Circus, shows a small boy, watched by a security guard, painting the words: ‘One nation under CCTV.’

©SPLASH

You’re being watched: Despite being observed by CCTV cameras, elusive grafitti artist Baksy managed to create his latest – and biggest - work to date under the cover of darkness

Andrew Newman, 35, a businessman from Dulwich, who works locally, said: ‘It was only on Sunday morning that the Post Offices guys realised what had happened.’

Bill Clinton’s Madness: A Consequence of Heart-Bypass?

By John McDougall, MD:

©Unknown

Brain Damage from Bypass?

One of the savviest politicians of our generation, known for his wit, charm, and calm under extreme pressure, Bill Clinton appears out of character in the speeches and interviews televised since his bypass surgery September 6, 2004 – and his mental deterioration may be accelerating. Remember, this is the president who withstood public impeachment before the entire world for his relationship with Monica Lewinsky without once losing control. Now, he is easily angered by hecklers, and makes factual mistakes and racial slurs while aggressively defending his wife’s campaign for presidency. Everyone sees his mental and emotional decline, yet to date, no medical professionals have spoken out about the cause or offered help.

Not a single one – not one bypass surgeon, cardiologist or psychiatrist – has stepped forward in his defense; even though all of them are trained to recognize “post bypass surgery cognitive dysfunction.” One of the best-kept secrets in medicine is the brain damage caused during bypass surgery. During my 40 years of medical practice I have never heard a doctor warn a patient before bypass surgery that an expected complication is memory loss. After surgery when the family complains of dad’s fits of anger, I have never heard a doctor admit that personality change is a common consequence of surgery. Yet these well-recognized side effects have been reported in medical journals since 1969.1

Brain damage during bypass surgery is so common that hospital personnel refer to it as “pump head.” The primary cause is emboli produced during surgery from clamping the aorta and from the “heart-lung machine.” This machine pumps blood to keep the patient alive while the heart is stopped during the operation. Unfortunately, this pump also introduces toxic gases, fat globules, and bits of plastic debris into the bloodstream of the patient under anesthesia. Once they are in the bloodstream, these particles migrate to the brain where they can clog capillaries and prevent adequate amounts of blood and oxygen from flowing to the brain. Essentially, all patients experience brain emboli during surgery and for many the damage is permanent.

In 2001, an article in the New England Journal of Medicine reported that 5-years after bypass surgery 42% of patients showed decline in mental function of approximately 20 percent or more.² A study published this year [...] in the Annals of Thoracic Surgery using MRI testing just after bypass surgery found brain damage in 51% of patients.³ Three years after their time on the bypass pump, significant permanent reduction in mental capacity was identified in 31% of patients. I am not talking major stroke here; but these patients can’t remember names or numbers as they once did, experience sleep disturbances (including nightmares), suffer mood swings, and lose intellectual acuity. Approximately 30 percent of people suffer persistent depression and some even contemplate suicide.

Our former president needs our understanding and support. A simple explanation by his doctors of the cause of his recent aberrant behaviors should bring peace of mind to Hillary and her campaign staff. If Mr. Clinton better understood his current limitations, he and his staff could take precautionary steps to avoid embarrassments. A long-overdue explanation would help his adoring public more easily accept his mistakes and readily forgive him. It is not your fault, Mr. Clinton.

As importantly, public recognition of the harm done to Bill Clinton by the heart surgery business would help the patients who undergo bypass surgery, and their families, to better understand similar changes they have experienced. A little attention from the media could also shine some light on the lack of survival benefits from this $90,000 procedure performed nearly half-a-million times annually in the US, and the superior benefits coming from diet and lifestyle changes.

I am saddened to see our former president suffer from public humiliation, but I am disgraced that my profession has thus far failed to come forward with a long over-due explanation and an apology to the Clintons and our nation for the harm they have done and the secrets they have kept.

John McDougall, MD

1) Hill JD, Aguilar MJ, Baranco A, de Lanerolle P, Gerbode F. Neuropathological manifestations of cardiac surgery. Ann Thorac Surg. 1969 May;7(5):409-19.

2) Newman MF, Kirchner JL, Phillips-Bute B, Gaver V, Grocott H, Jones RH, Mark DB, Reves JG, Blumenthal JA; Longitudinal assessment of neurocognitive function after coronary-artery bypass surgery. N Engl J Med. 2001 Feb 8;344(6):395-402. 9Link: http://content.nejm.org/cgi/reprint/344/6/395.pdf)

3) Knipp SC, Matatko N, Wilhelm H, Schlamann M, Thielmann M, Lösch C, Diener HC, Jakob H. Cognitive outcomes three years after coronary artery bypass surgery: relation to diffusion-weighted magnetic resonance imaging. Ann Thorac Surg. 2008 Mar;85(3):872-9.

American Health Care is a Happy Meal

By Curt Maynard, from What Really Happened:

Have you ever wondered why is it that American children love the McDonald’s Happy Meal so much? After all the food inside is no different than what can be ordered right off the menu, hamburger, chicken nuggets, drink and fries. Is it the toy perhaps? The aesthetically pleasing, brightly colored bag?

Personally, I think it’s a bit of both, don’t children just love the idea of a free surprise inside anything. I mean think about it, isn’t the advertising strategy associated with sugary cereals exactly the same, a toy inside a brightly colored box with friendly cartoon characters on the exterior?

Kids already know what to expect, by the time the average American child is eight they’ve undoubtedly consumed hundreds of happy meals, yet they still go for it each and every time their parents enter the McDonald’s drive through. Surely, the mystery must be gone, they must know how the burger or nuggets will taste. I’m not really all that convinced that the toy itself is very important to most children, what I’ve witnessed with my own eyes is that the toy is generally destroyed, discarded and forgotten by the time the child gets back home. The brightly colored, aesthetically pleasing bag can’t be the most important highlight of the meal either, as a rule kids don’t bother reading whatever frivolous messages are written on it – they may take a crayon and complete a maze or something like that, but in the end, after the food has been consumed, the bag is tossed along with the remnants of the meal.

Taking all the above into consideration I am left wondering if it isn’t the overall “presentation,” I.e. the meal, bag and toy together that ensure the child will consistently order and then reorder the same old crap, and that’s what it really is isn’t it, crap? If you, the reader are under the impression that a McDonald’s Happy Meal is a wholesome and nutritious choice for your child’s palate, then there really isn’t any reason you should continue reading this particular piece, stop reading it, and go back to your MTV and videogames. If there is a member of the opposite sex that’ll have sex with you, please use a condom.

So then, how does the Happy Meal relate to modern American health care? Well, I’m glad you asked, and I’ll be happy to share my opinion with you, but first, allow me a caveat. This essay is bound to irritate, annoy, and probably alienate many people. Most readers will agree with most of the ideas set forth, but in all likelihood, most readers will also be angered by some element, and it’ll be that one issue, that will violate some sacred cow or another and will cause most readers to reject everything within. If you are one of the few truly objective people left out there, this essay was written for you, and in truth, it is only people like you that are likely to understand the greater meaning of this article and its purpose, which of course is change.

Am I advocating socialized medicine? Ha, hardly, the government can’t do anything right, why would they be able to manage health care any better and/or more honestly that they manage foreign and domestic policy, wars and occupations, legislation and law enforcement? The truth is, the entire health care system is irreparably broken and will never be fixed until it is allowed to collapse first. I could tell you how it could be successfully reconstructed after its demise, but the reader would find the answers so distasteful that 99% of all them would reject these recommendations out of hand. Thus it is far easier, to allow the inevitable collapse to happen, and then realistically repair it afterwards, and that is the key word, realistically. Today, the American health care system is a Happy Meal, and people aren’t willing to forgo their toy and brightly colored bag for more nutritious food.

The point in writing this essay isn’t to offer any solutions to the disaster that the American health care system has become, it’s to point out how Americans have inexorably come to accept the corporate involvement in their health care, which by the way is manifestly insane, in that even the dimmest bulbs today know fully well that corporations don’t care about people, only the bottom line, profit.

The vast majority of Americans, and probably people worldwide are under the impression that medicine today is better than it was fifty years ago. In some respects this is true, but in others it is abysmally incorrect. Here is one example – a country doctor fifty years ago could listen to his patients lungs and immediately diagnose pneumonia, he didn’t require x-rays, blood tests, arterial blood gasses, a pulmonologist’s second opinion, or a consult from an infection control specialist. One shot of penicillin would clear the whole thing up, the patient was back to work in three days and the doctor received reasonable compensation. In the 1970s severe cases of pneumonia generally didn’t require more than three days on an intravenous antibiotic, and thus three days in hospital, and then 7-11 additional days on an oral antibiotic at home. Today, a severe case of pneumonia is most likely to require 10 -14 days on a variety of different IV antibiotics, some of them quite toxic, a half dozen chest x-rays, multiple arterial blood gasses and dozens of other lab tests involving blood. In all likelihood the patient will receive at least one CT scan or MRI at between $1000 and $3,800 a pop and if their elderly, a week or two on a rehab unit where they’ll receive physical and occupational therapy until they’re able to transfer safely from their bed to a bedside commode.

How did this happen? It’s simple really, because of the abuse of antibiotics and believe it or not, unrestricted immigration, which has allowed people with Third World infections to come into this country and be given medical treatment in our hospitals, nosocomial [hospital acquired] infections have skyrocketed. Hospitals are a perfect breeding ground for the continuation of these infections and provide an excellent place for the infections to mutate into more virulent forms. If patient A has a relatively nasty respiratory infection and Patient B is elderly and immuno-compromised, and the respiratory therapist taking care of them both has been coughed on by Patient A, there is a small possibility that the RT will carry that bacterium into Patient B’s room and expose the immuno-compromised Patient B to it. Patient B then develops the infection, but it then mutates because Patient B’s immune system isn’t as strong as Patient A’s and an entirely new version of the same infection can arise, requiring different antibiotics to treat. This is old hat, few people are unaware of these facts today, but what they may be unaware of is that the simple use of deductive logic demand that if this is true, and it is, the longer someone stays in a hospital the more likely they are to acquire one of these resistant bacterial infections, which should convince even the greatest adherent to the virtues of modern medicine, that staying in a hospital for more than a few days is a very bad idea. Now I’ve pissed off all of the respiratory therapists reading this essay, they’re outraged, their tender feewings have been hurt, but nonetheless what I’ve written is true. All hospitals are required to train their medical staff to properly wash their hands and to follow basic rules that reduce the likelihood of cross contamination, but nonetheless, statistically, with the hundreds of thousands of doctors, nurses, respiratory therapists, X-ray technicians, phlebotomists, volunteers, etc… hundreds, if not thousands of people are infected every single day in this country with an infection they did not have the day before. By the way, doctors are the worst offenders, ask any nurse. See! I told you. Now I’ve pissed off the doctors too.

In any case, how does this all relate to a Happy Meal? Well, a Happy Meal is essentially nothing but a hamburger, fries and a drink, but because it comes in a brightly packaged bag and has the promise of a toy inside, children absolutely love them. Adults too apparently haven’t outgrown their childish need for a toy and brightly packaged bag of crap either, as that is in effect what your health care is today – crap in a brightly colored bag with the promise of a forthcoming toy within.

We’ll explore the inherent problems with America’s health care system in the next few essays I write over the next month, but today we’ll focus on something that most people don’t even consider, and that is the consumer’s [YOU] unrealistic expectations. First off, you have allowed your health care system to be hijacked by corporations. Even the average deluded fool understands that a corporations bottom line is the dollar, yet you still have faith in corporate medicine – why? In truth you know better, but you’re in a state of denial that really knows no bounds.

Every time you turn on and watch the idiot box [television] it soothes you into a false sense of security, many of its programs revolve around medicine in some manner, whether it be about doctors, nurses, the emergency room, surgery, or whatever, you’re there with your popcorn and that same stupid look on your face, the avid viewer, the fan. The fact that its all a giant bag of shit never occurs to you, you like that handsome young doctor, and that’s all there is to it. It’s a fraud wake up! In any case, these programs help make you feel secure about your health care system, you always see the doctors find a cure, they have every single technological toy at their disposal – all that’s needed is just a doctors order and everything will be okay. You can’t imagine as you sit there rapt up in the program, that often there is nothing that can really be done for certain medical conditions – or even that occasionally, nothing should be done, that just doesn‘t compute, does it? These television docudramas never cover stories like that of a woman that entered the hospital for a simple surgery and left with no arms and legs or how two physicians involved in a medical case think that the other is monitoring the patient only to find that neither was monitoring blood levels of the patient who was receiving a nephro-toxic antibiotic and as a result the patients kidneys were destroyed because of their indifference or negligence. Hey – I guarantee you this happens all the time.

Want me to tell you a little secret? When you work for a corporation and you see things like this happen, you never tell. Nope, that’s right, you never say a damn thing, because you need your job in order to keep yourself out of bankruptcy from all that worthless materialistic crap you purchased over the last several years to entertain your pathetic self with. Want to know another secret? The corporations ain’t gonna tell either – nope – that’s called a liability and corporations will cover them up quick.

How does this work in health care. Let me provide a theoretical example. Let’s say that a patient is receiving an antibiotic called Vancomycin. Vancomycin is a last line antibiotic, if it can’t kill your bacterial infection, you’re screwed. It’s an incredibly effective antibiotic, but it causes kidney damage if blood levels aren’t closely monitored. Here’s the situation. A doctor orders the antibiotic, but he subsequently transfers his patient to a sub acute setting, where he isn’t obligated by law to see them on a daily basis. Well, doctors are human you know and he forgets about his patient. Since his patient is on a sub acute floor, the nurses aren’t of the same caliber as those on an acute medical unit and they don’t call the doctor to remind him to check his patients blood levels, which by the way, is ultimately his responsibility anyway, not the nurses. Time goes on and eventually the doctor remembers that he has a patient, then he remembers with dread, that his patient has been receiving Vancomycin for several weeks. He checks the blood levels and finds that he has destroyed the patients kidneys. Well reader, what do you suppose he does then? Does he report himself? Does he confess his error to the hospitals administrative branch or does he discharge the patient home and never tell them? What happens if the hospitals administrative branch finds out? Do you really think they’ll inform the patient? Do you think they’ll report themselves and open the facility up to a lawsuit? If you do, you’re a fool. Nope, everybody just pretends it never happened and when the patient reports to the doctor weeks later with complaints of jaundice and associated maladies, wouldn’t you know that he/she must have been exposed at some point after discharge to a malicious virus.

You should know better by now – you’ve seen how the corporations are screwing America and anyone and everyone in it. Why is it that you think they wouldn’t screw you too? Is it the “Happy Meal,” was it the aesthetically pleasing private hospital room they provided you with, was it the bells and whistles and buzzers and lights associated with all that high tech garbage the toted you to and from? Was it the “professionalism” of the hospital staff [They are trained to placate you with apologies and smiles, not with individual attention, that costs too much]. You should know better by now than to expect much from a corporation – and that is what your health care system is, “Corporate Medicine.”

If the above frightened you at all. Congratulations, you’re not completely deluded and/or asleep at the wheel.

Connecticut poor pay more of income on taxes, than rich according to report

From WTNH.com:

New Haven (AP) — A new report shows Connecticut’s middle class and poor families pay a higher percentage of their income in state sales and local taxes than the wealthiest families.

The report by Connecticut Voices for Children is based on an analysis of state and local tax data, the New Haven Register reported.

The report says the wealthiest Connecticut families pay 4.7 percent of their income in state and local taxes.

Middle-class families pay 9.6 percent of their income in state and local taxes. The report shows the poorest 20 percent pay 10.9 percent.

Opponents of increasing taxes for Connecticut’s wealthiest families city state figures show the top 5 percent of Connecticut taxpayers pay more in state income taxes than the bottom 95 percent combined.

Seriously ill? Need costly drugs? Go broke or die

By Dr. Denny from Scholars and Rogues:

Has the financial tipping point of life vs. death finally arrived? Do you now need to be financially healthy (meaning rich) to ease suffering from or survive diseases such as multiple sclerosis, rheumatoid arthritis, hemophilia, hepatitis C and some cancers (such as metastatic breast cancer)?

The lead story in the print edition of today’s New York Times reports this chilling fact:

Health insurance companies are rapidly adopting a new pricing system for very expensive drugs, asking patients to pay hundreds and even thousands of dollars for prescriptions for medications that may save their lives or slow the progress of serious diseases.

With the new pricing system, insurers abandoned the traditional arrangement that has patients pay a fixed amount, like $10, $20 or $30 for a prescription, no matter what the drug’s actual cost. Instead, they are charging patients a percentage of the cost of certain high-priced drugs, usually 20 to 33 percent, which can amount to thousands of dollars a month.

Simply put: For some drugs, you no longer pay a fixed amount as a co-pay; you pay a percentage of the drug’s cost (up to a certain amount, under some plans).

For the past decade, those who can afford health insurance (47 million people don’t have it) or have it provided by employers have become used to drug formularies and three-tier pharmaceutical benefits. For example, my provider requires:

• a $7 co-pay for Tier 1 drugs: generics, over-the-counter and certain brand names.
• a $15 co-pay for Tier 2: other “preferred” brand-name drugs.
• a $40 co-pay for Tier 3: all other drugs; i.e, drugs not listed in the providers formulary.

Increasingly, notes The Times, insurers have added Tier 4 and Tier 5 co-pays, following the lead of Medicare drug plans (you know, those plans in which the government bargained away its ability to get bargains?).

Now Tier 4 is also showing up in insurance that people buy on their own or acquire through employers, said Dan Mendelson of Avalere Health, a research organization in Washington. It is the fastest-growing segment in private insurance, Mr. Mendelson said. Five years ago it was virtually nonexistent in private plans, he said. Now 10 percent of them have Tier 4 drug categories.

The drugs covered by these Tier 4 and Tier 5 categories are expensive. So if these tiers charge a percentage of the cost rather than a flat co-pay, it can become ruinously expensive.

If you’re suffering from the relapsing-remitting (RRMS) form of multiple sclerosis, you may be taking Copaxone to reduce the relapse rate. The drug may cost nearly $2,000 a month. Your co-pay might have been a flat-fee $25 a month in a three-tiered plan. Under Tier 4 or 5, the co-pay may be a percentage of the whole cost.

At 25 percent of Copaxone’s cost, your co-pay could hit $500 a month (unless capped at a specific amount). That’s a life-altering 1,900 percent increase.

Why do insurers do this? Reports The Times: “Insurers say the new system keeps everyone’s premiums down at a time when some of the most innovative and promising new treatments for conditions like cancer and rheumatoid arthritis and multiple sclerosis can cost $100,000 and more a year.” [emphasis added]

That’s like taking on a second mortgage, which people may, in fact, have to do to ease their suffering or prolong their lives. They might indeed ask: What’s the point of having insurance in the first place? Wasn’t it intended to prevent financial ruin by spreading the risk across an enormous pool? Again, from The Times:

But the new system sticks seriously ill people with huge bills, said James Robinson, a health economist at the University of California, Berkeley. “It is very unfortunate social policy,” Dr. Robinson said. “The more the sick person pays, the less the healthy person pays.”

Traditionally, the idea of insurance was to spread the costs of paying for the sick.

“This is an erosion of the traditional concept of insurance,” Mr. Mendelson said. “Those beneficiaries who bear the burden of illness are also bearing the burden of cost.” [emphasis added]

This is beyond my pittance of knowledge of health economics to figure out. But generally, I smell a rat. Rather, two rats.

I find it difficult to separate Big Pharma (on which we depend for life-saving drugs); Big Insurance (on which we depend to help us pay for those drugs without driving ourselves into bankruptcy); and the decade-long, dramatic rise of out-of-pocket costs for health care (particularly for life-saving drugs) through higher and higher co-payments.

For Big Pharma, which does the research and development for the medications that heal us and save our lives, there’s this question:

Why do you charge so much for these Tier 4 and 5 drugs? (This is not the same question as this: What factors account for the real wholesale costs of these drugs?)

For Big Insurance, there’s this:

Why have you shed the traditional concept of sharing the risk across a large pool of insurees? The subhed of The Times‘ story is telling: Insurers shift burden. Why? Here’s the industry’s stock answer:

Private insurers began offering Tier 4 plans in response to employers who were looking for ways to keep costs down, said Karen Ignagni, president of America’s Health Insurance Plans, which represents most of the nation’s health insurers.

So Big Insurance blames employers, saying they want lower costs. But isn’t that leaving out a bunch of other factors? Why has the cost of health care (and insurance to cover that cost, particularly drugs) become so high that employers complained about the cost? Big Insurance is not being wholly honest in blaming employers.

Meanwhile, I observe the following trends.

According to a 2002 report by the Government Accountability Office:

[P]harmaceutical companies spent $30.3 billion on research and development and $19.1 billion on all promotional activities, which includes $2.7 billion on DTC advertising, in 2001. Pharmaceutical companies have increased spending on DTC advertising more rapidly than they have increased spending on research and development. Between 1997 and 2001, DTC advertising spending increased 145 percent, while research and development spending increased 59 percent. Promotion to physicians accounted for more than 80 percent of all promotional spending by pharmaceutical companies in 2001. Total promotional spending was equivalent to 12 percent of drug sales in the United States in 2001. [emphasis added; DTC = direct-to-consumer]

According to another study using 2004 data, Big Pharma spent almost twice as much on promotion as it does on research and development:

The researchers’ estimate is based on the systematic collection of data directly from the industry and doctors during 2004, which shows the U.S. pharmaceutical industry spent 24.4% of the sales dollar on promotion, versus 13.4% for research and development, as a percentage of US domestic sales of US $235.4 billion.

Big Pharma lobbies Congress extensively and increased its lobbying in 2007 more than any other industry. According to the Center for Responsive Politics:

[T]he pharmaceuticals/health products industry outspent all industries by shelling out $227 million for lobbying services, or an average of $1.4 million for the 164 days that the 110th Congress met in 2007. The drug industry has spent $1.3 billion on federal lobbying over the last 10 years, more than any other industry. Its reported lobbying increased 25 percent in 2007. [emphasis added]

Overall, the entire health industry spent early $445 million on lobbying in 2007.

Since 1990, Big Pharma has made about $152 million in campaign contributions to candidates for federal office. (Health services and HMOs have given nearly $54 million since 1990.)

Big Insurance (which obviously covers more than health-related insurance) spent about $138 million on lobbying in 2007 and more than $1 billion since 1998. Since 1990, Big Insurance has made more than $287 million in campaign contributions.

What a frickin’ mess. Industries have carved out new social policy. So we ought to be asking some basic questions:

What is the priority of Big Pharma? How does that priority fit into social policy as articulated by the legislative and executive branches of government?

What is the priority of Big Insurance? How does that priority fit into social policy as articulated by the legislative and executive branches of government?

What is the relationship between Big Pharma and Big Insurance? How does that relationship fit into social policy as articulated by the legislative and executive branches of government?

Now, if we can persuade our presidential candidates to stop caterwauling about minutiae in “he said/she said” language, perhaps they’ll address questions like this before we have to vote for one of these feckless dolts in November.

And we might ask our members of Congress what impact those hundreds of millions of dollars in campaign contributions and lobbying expenses have on their ability to set social policy that doesn’t leave people financially bereft of hope and at risk of life when struck by serious illness.

Only A Miracle Can Save America Now

by Chuck Baldwin, April 15, 2008:

Every four years, conservative “pragmatists” trot out the “We Can’t Let So-And-So Win” mantra. Of course, the so-and-so in question is always the Democratic Presidential candidate. For all of my adult life, I have been listening to so-called “conservative” Republicans warn us of the impending doom that would befall our country if the Democratic candidate were elected. And this year is no different.

This year’s Republican primary did provide a wonderful aberration, however, to the usual choices between Tweedledee and Tweedledum. Republicans had an opportunity to nominate a real American constitutionalist, a statesman in the similitude of Thomas Jefferson or James Madison. That man was Texas Congressman, Ron Paul. Unfortunately, the Republican faithful seem to be incapable of discerning the marks of true greatness, not to mention fidelity to constitutional government. It is doubtful that most of them even understand what constitutional government is. And as for Christian conservatives, they can barely see any issues beyond abortion and “gay rights.” To try and convince them to support a constitutionalist candidate is like talking to a brick wall.

So, what choice does the Republican Party offer the American people this year? The worst of all possible choices: good old John “McSame” McCain.

Let’s be clear: a John McCain Presidency will be no better than a Hillary Clinton or a Barack Obama Presidency. In fact, in many ways, a McCain White House will be WORSE than a Democratic one.

On many issues, there is virtually no distinction between John McCain and any potential Democratic candidate. John McCain is no friend to gun owners. He is no friend to pro-lifers. He is no friend to fiscal conservatives. He is no friend to property owners. He is no friend to “family values” voters. He is no friend to America’s blue-collar workers. He is no friend to small business owners. He is no friend to opponents of illegal immigration.

On the other hand, John McCain is a great friend to Big Business. Similarly, he is a friend to Big Government and Big Brother. He is also a friend to open borders, supranational government, regionalism, and American imperialism.

But this is where the Boogeyman comes in.

At this point, Republican Party lackeys will break in and say, “We can’t let Hillary Clinton win. We can’t let Barack Obama win.” Even the favored son of the Religious Right, Mike Huckabee, has endorsed John McCain, not to mention Mitt Romney and virtually every other Republican “bigwig.” (Thank God, Ron Paul has maintained his integrity by NOT endorsing McCain.)

I, for one, am fed up with this baloney, because what we are actually faced with is not the “lesser of two evils” but “the evil of two lessers.” (To quote a good friend of mine.) And the reason John McCain would actually be a worse President than either Obama or Clinton is because of the manner in which conservatives go to sleep whenever a Republican occupies the Oval Office. Furthermore, the next couple of years are “crunch time” for this burgeoning North American Union and related issues.

America is currently facing the most serious threat to its national independence and sovereignty since the War of 1812. The forces of globalism have declared an all-out war against our country’s independence. Illegal immigration, the NAFTA superhighway, the North American Community, a regional currency called the Amero, and “free trade” deals are just a few of the weapons in their arsenal. And John McCain will use every bit of his power as President to facilitate all of this chicanery. And, because McCain is a Republican, conservatives and Christians will sit back and let it happen without even the slightest whimper of resistance. If Obama or Clinton were sitting in the Oval Office, however, massive numbers of conservatives and Christians would rise in protest over every inch of ground ceded to these nefarious nabobs. So, tell me, who is the greater evil? I say it is John McCain.

I realize that there are many readers shouting to themselves right now and saying, “So what do we do, Chuck? We have to vote for one or the other.” To which I say, No you don’t. You can think outside the box. You don’t have to throw your vote away on either of these wretched candidates. You can cast a vote for principle and vote for a third party candidate.

I can hear readers screaming at me now, saying that voting for a third party candidate is a wasted vote. I strongly disagree! Casting a vote for a person who you know is unfaithful to your principles is a wasted vote! Voting for someone who you know will keep our borders and ports open to illegals, continue George Bush’s preemptive war doctrine, and facilitate a burgeoning hemispheric government–not to mention someone who will increase and augment a burgeoning Orwellian police state–is a wasted vote!

At some point, we Americans must decide whether we will tolerate the continued sellout of our freedoms and principles or not. Will we swallow the shallow squeals of the establishment elite who think we are a bunch of sheep to be herded into their New World Order? Or will we stand our ground? Will we vote our principles and our conscience?

It does not matter that the pundits and experts say we can’t win. That is not our business. As John Quincy Adams said, “Duty is ours; results are God’s.” When will Christians, especially, quit trying to play politics and start standing for principle? They talk a lot about principle, but when it comes down to where the rubber meets the road, most don’t act like people of principle.

If God intends to give America another chance, if He intends to return these United States to constitutional government, and if He intends to preserve America’s independence, it will only come in the form of a miracle. And miracles do not happen by the machinations of pragmatic planners. Miracles are just that.

America was born a miracle, and it could now be given a new birth by miracle. If so, it would demand that people of principle start acting like it. That we cast aside the pragmatic, the reasonable, the sophisticated, and the expected. That we–as did the priests of old–would be willing to step out into the raging current of the Jordan River, knowing that either God would part the water or we would drown. That we would be willing to sign our names to a document–as did our Founding Fathers–that would make us either the enemies of the state or the inventors of a new nation. It means taking risks; it means doing the impractical; it means rejecting accepted wisdom and standing for principle.

I am convinced that only a miracle can save America now. And I am expecting God to grant such a miracle. Beyond that, I am willing to do my part to place myself in a position to let God use my voice and my vote to accomplish this miracle. And if that means voting for someone who “has no chance of winning” in order to let God take the glory for whatever victory results, it is the least I can do. So, who will join me?

*If you enjoyed this column and want to help me distribute these editorial opinions to an ever-growing audience, donations may now be made by credit card, check, or Money Order. Use this link:

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Want to Save the Economy? Spread the Wealth and Give Workers a Raise

By Mike Whitney, Counterpunch.org. Commentary from Signs of the Times following article.

Insolvency’s dark shadow hangs over Wall Street. One major player, Bear Stearns, has already gone under, and from the looks of it, another investment giant may be on the way down. It’s getting ugly out there. The so-called TED spread, which measures the reluctance of banks to lend to each other, has begun to widen ominously suggesting that the money markets think another dead body will be floating to the surface any day now.

The ongoing deleveraging of financial institutions and the persistent downgrading of assets has the Fed in a tizzy. Bernanke has backed himself into a corner by stretching the Fed’s mandate to include everyone on Wall Street with a mailing address and a begging bowl. Now he’s taken on the even larger task of fixing the plumbing that keeps credit flowing between the various investment banks. Good luck. There’s plenty of more pain ahead. The IMF expects the final tally will be $945 billion, that means $3 trillion in lost loans for the banks. Bernanke better pace himself; this mess could last for years.

The US subprime fiasco has spiraled into what the IMF is calling “the largest financial shock since the Great Depression.” America’s capital markets are on the fritz. The corporate bond market is frozen, the banks are buckling from their losses, and the housing market is in a shambles. No one is buying and no one is lending. Private equity deals are off 75 per cent from last year and no one will touch a mortgage-backed security (MBS) with a ten foot pole. The mighty wheel of modern finance is grinding to a standstill and no one’s quite sure how to rev it up again.

The US consumers are feeling the pinch, too. Credit cards are maxed out, student loans overdue, car payments in arrears, and mortgages entering foreclosure. Also, wages haven’t kept pace with production and and the home-equity ATM has been shut down. Now that the credit tap has been turned off; the American worker is hurting, but no one is offering a bailout or a even helping hand; just a few table-scraps from Bush’s “surplus package”. 500 bucks will just about fill the tank of a normal-sized SUV. A new survey from the Pew research Center “Inside the Middle Class-Bad Times Hit the Good Life”, shows that working families are in debt up to their ears and that fewer Americans “believe they are moving forward” than anytime in the last half century. The study also shows that most people believe “it’s harder to maintain a middle class life style” and that “since 1999, they have not made economic gains.” Average families are struggling just to make ends meet.

That’s why so many people bought homes when they should have opened savings accounts. They were duped into speculating on housing so they could get a chunk of money. It looked like a good way to overcome stagnant wages and crappy hours. The cheer-leading TV pundits offered assurances that “housing prices never go down”. It was all baloney. Now 15 million homeowners are upside-down on their mortgages and the very same experts are scolding workers for fudging the facts on their income disclosure forms. It’s all backwards.

No wonder consumer confidence has dropped to record lows. Working people don’t need lectures on saving money; they need a raise. The big-wigs at Bear Stearns are still dining on crab-cakes at the Four Seasons while the working folk are just trying to make their way through Greenspan’s nuclear winter living on beef jerky and Big Gulps. Where’s the justice?

Volumes have been written about the current crisis; subprime-this, subprime that. Everything that can be said about collateralized debt obligations (CDOs) credit default swaps(CDS) and mortgage-backed securities (MBS) has already been said. Yes, they are exotic “financial innovations” and, no, they are not regulated.

But what difference does that make? There’s always been snake oil and there have always been snake oil salesmen. Greenspan simply raised the bar a notch, but he’s not the first huckster and he won’t be the last. What really matters is underlying ideology; that’s the root from which this economy-busting hydra sprung. 30 years of trickle down, supply-side gibberish; 30 years of idol worship for the waxy-haired reactionary, Ronald Reagan; 30 years of unrelenting anti-labor, free market, deregulated orthodoxy which inflated the biggest equity-Zeppelin in history

Now the bubble is hissing out of the blimp and the escaping gas is wreaking havoc across the planet. There are food riots in Haiti, Egypt, and Kuwait. Wherever the local currency is pegged to the falling dollar, inflation is soaring and trouble is brewing. Also, European banks are listing from the mortgage-backed garbage they bought from brokerages in the US and need central bank bailouts to stay afloat. It’s just more fallout from the subprime swindle. Finance ministers in every capital in every country are getting ready for a 1930’s-type typhoon that could send equities crashing and food and energy prices rocketing into the stratosphere. And it can all be traced back to the wacko doctrines of neoliberalism. These are the theories that guide America’s “screw-thy-neighbor” monetary policies and spread financial turmoil to every city and hamlet around the world.

The present stewards of the system are incapable of fixing the problem because they represent the interests of the people who benefit most from the disruptions. Paulson’s latest “blueprint” for the financial markets is a good example; a more pro-business, self-serving scheme has never been put to paper. Gary North sums it up in his article “Really Stupid Loans”:

“With the Federal Reserve System’s latest proposal, presented to the public by Secretary of the Treasury Henry “Goldman Sachs” Paulson, the Fed is asking the United States government to make it the Great Protector of Capital…. The new proposals will centralize power over finance in the hands of an agency that is officially run by the government but in fact is run by agents of the largest fractional reserve banks. …Regulation by tenured staff economists will not make the system less fragile. It will make it more top-heavy and less flexible..

“Some version of this plan will probably pass in the next Congress. No matter whether it does or does not, the direction is the same: toward an economy controlled by the federal government in conjunction with titular private ownership of the means of production, that is, toward fascism.” (Gary North, “Really Stupid loans”, lewrockwell.com)

The whole point is to put the markets in the Fed’s control so that when the next financial crisis arises (from the next swindle) the Fed can bailout the bankers and hedge fund managers without consulting Congress.

Paulson’s plan is a power-play; nothing more. The investment Mafia wants to take over the whole financial system lock, stock and barrel. They want to liquidate the SEC and any other government watchdog and put the investment banks, hedge funds and brokerages on the honor system. It’s the end of transparency and accountability which, of course, are already in short supply.

Currently, Paulson and Bernanke are expanding the balance sheets of the Government Sponsored Enterprises (GSEs) so that Fannie Mae and Freddie Mac will underwrite 85 per cent of all mortgages while FHA will cover 10 per cent more. The mortgage industry is being nationalized to save banking fellowship while the taxpayer is on the hook for another $4.4 trillion of dodgy loans. Paulson doesn’t care if the taxpayer gets stuck with the bill. What bothers him is the prospect that, somewhere along the line, workers will demand higher wages to keep pace with inflation. Then all hell will break loose. Paulson and Co. would rather see the economy perish in a deflationary holocaust than add another farthing to a working person’s salary. He and his ilk take class warfare seriously; that’s why they are winning. But their strategy also creates problems. When wages don’t keep pace with production, demand decreases and the economy falters. That’s what’s happening now and Paulson knows it. Workers are over-extended and can’t buy the things they make. They barely have enough to feed the kids and fill the tank for work. Consumer spending (which is 72 per cent of GDP) is nose-diving at the very same time the Fed’s equity bubble is exploding.

Neoliberalism has a twenty-year record of producing the very same economic calamities. Why is this crisis different? Why should the US be spared the same predatory treatment as the many other victims of the global corporate oligarchy? After the Fed’s equity bubble bursts, the corporate vultures will swoop down and buy up vital resources and industries for pennies on the dollar.

Economist Michael Hudson anticipated many of the present-day developments in the financial markets in an amazingly prescient interview in CounterPunch in 2003 called “The Coming Financial Reality”:

Michael Hudson: “Free enterprise under today’s financial conditions threatens to bring about an unprecedented centralization of planning, not in the hands of government but by the financial conglomerates and money managers. Whatever government planning power is destroyed becomes available for them to appropriate, with plenty of vigorish left for the politicians whose campaigns they back and who will “descend from heaven” into high-paying private-sector jobs, Japanese style, after having performed their service for the new regime.

Question: The financial regime is nothing but parasites?

Michael Hudson: “The problem with parasites is not merely that they siphon off the food and nourishment of their host, crippling its reproductive power, but that they take over the host’s brain as well. The parasite tricks the host into thinking that it is feeding itself.

“Something like this is happening today as the financial sector is devouring the industrial sector. Finance capital pretends that its growth is that of industrial capital formation. That is why the financial bubble is called ‘wealth creation,’ as if it were what progressive economic reformers envisioned a century ago. They condemned rent and monopoly profit, but never dreamed that the financiers would end up devouring landlord and industrialist alike. Emperors of Finance have trumped Barons of Property and Captains of Industry.” (Michael Hudson, “The Coming Financial Reality”, counterpunch, interviewed by Standard Schaefer.)

Bingo. Hudson not only explains how finance capitalism is inserting itself into the governmental power structure but, also predicts that “industrial capital formation” — which is the production of things that people can really use to improve their lives — will be replaced with complex debt-instruments and derivatives that add no tangible value to people’s lives and merely serve to expand the wealth of an entrenched and increasingly powerful investor class.

Finance capitalism has “devoured landlord and industrialist alike” and created a galaxy of seductive liabilities which masquerade as assets. Derivatives contracts, for example, represent over $500 trillion of unregulated counterparty transactions; a “shadow banking system” completely disconnected from the underlying “real” economy, but large enough to send the world into a agonizing depression for years to come.

The goal should be to dismantle this corrupt Ponzi-system, which merely wraps debt in a ribbon, and rebuild the economy on a solid foundation of productive labor, worker solidarity and and above all the redistribution of income and hence purchasing power away from the system which now flow to the top two or three per cent.

Political power has to be taken from the financial mandarins or the disparity of wealth will continue to grow and democracy will wither. We’ve already seen our main institutions — the courts, the congress, the media, and the presidency — polluted by the steady flow of corporate contributions which only serve the narrow interests of elites.

Henry Liu expands on this idea in his excellent article “A Panic-stricken Federal Reserve”:

“In the 1920s, the wide disparity of wealth between the rich and the average wage earner increased the vulnerability of the economy. For an economy to function with stability on a macro scale, total demand needs to equal total supply. Disparity of income eventually will result in demand deficiency, causing over-supply. The extension of credit to consumers can extend the supply/demand imbalance but if credit is extended beyond the ability of income to sustain, a debt bubble will result that will inevitably burst with economic pain that can only be relieved by inflation…..More investment normally increases productivity. However, if the rewards of the increased productivity are not distributed fairly to workers, production will soon outpace demand. The search for high returns in a low demand market will lead to consumer debt bubbles with wide-spread speculation …. Today, outstanding consumer credit besides home mortgages adds up to about $14 trillion, about the same as the annual GDP.”

Voila. A strong economy requires a strong workforce and an equitable distribution of wealth. When money is concentrated in too few hands, the political system atrophies and becomes unresponsive to the needs of its people. That’s when the nation’s laws and institutions are reshaped to reflect the ambitions of rich and powerful.

The financial system is doing exactly what it was designed to do, it is crumbling from the decades-long trickle-down experiment. Social programs have been gutted, civil infrastructure is in tatters, legal protections have been savaged, and workers rights have been trounced. Is it any wonder why we’re embroiled in an unwinnable war and the financial system is on its last legs?

The only way to break the stranglehold of Wall Street’s financial Politburo is to level the playing field through greater wealth distribution. That’s the best way to rekindle democracy and make America the land of opportunity again. And it all starts with giving America’s workers a raise.

Commentary from Signs of the Times:

Sounds nice, but how would this come about? Stef Zucconi tells us bluntly what we’re up against:

For those of us with a less, um, stochastic view of how the world works and who believe that s*** doesn’t always ‘just happen’, mainstream media accounts of what’s going on in the world are often frustrating and, occasionally, amusing – but only in a very dark way

The coverage of the state of the British and World economy being the most immediate example that comes to mind

The British media has recently finally woken up to some key economic trends which have been noticeable for some time now but there has been far too much other, much more important stuff to report on. Those key economic trends include…

• The price of oil is going up lots
• The price of rice is going up lots
• The price of wheat is going up lots
• The price of gold is going up lots
• The value of the dollar is going down lots
• The value of the pound is going down lots
• The availability of retail credit is going down lots

And not only has the British media been rather slow in reporting these movements, it is also meticulous about reporting these movements as unconnected events and giving some frankly bollocks explanations as to the causes

Last night, on Channel 4 News for example, we were treated to appearances from representative jackals from both the World Bank and the IMF; in two scrupulously separated news items, lying through their f****** teeth about why the British/ European/ World economy is going to go t*** up and why people can’t afford food in a growing number of regions of the world

What neither owned up to is that the underlying reason why all these things are happening is that a massive re-balancing of the world’s already unequal distribution of wealth is now well under way

Re-balancing is, of course, a euphemism for naked theft

UK interest rates have just been cut by another 0.25% and even before the cut the media whores were warning people that this cut, as with the previous cuts, would probably not be passed onto ordinary borrowers and that banks would continue to cut back on the volume of mortgages they are lending to people

Which is all very strange when you think about. Central banks have been creating and pumping money into the global economic system but the stuff is, so we are told, still thin on the ground

Where’s it all going?

I’d suggest a good place to start looking is in the markets that speculate in the price of things none of us can do without. Right now, borrowing made-up money at 5% to punt on and drive up the price of food or oil another 20, 30, 40 or 50% is pretty much a one way bet

…only your average person hasn’t got the resources or the means to buy their food six months forward. So, they’ll just have to take it up the rear end when the prices rise won’t they?

We are repeatedly told, from cradle to grave, that the cost of the things we need is driven by supply and demand. For example, the price of houses in the UK and the US was driven by population pressure, the increase in the number of households and a failure to build enough new housing

Bollocks

That’s only half the story – and not the interesting half

The other key driver for the pound or $ price of a commodity is the supply and demand of the money used to pay for it. And if you can force up the price of something by flooding a market with money, whilst restricting increases in what people earn, you end ******** those people big time

and you can flatten the price of anything just as easily

The need for housing in the US or UK didn’t suddenly drop overnight

In the same way that the need for rice or wheat didn’t suddenly leap up overnight either

There are some very, very evil f****** manipulating both the supply of the essentials of Life and the money used to pay for that supply. Those of us on the demand side are currently at their mercy. A quality that oligarchs are not exactly renowned for.

The only hope of dismantling the “corrupt Ponzi-system” Whitney refers to lies with a more accurate understanding of human nature. One that takes into account the nature of normal humans as well as the nature of the “other human race,” the psychopaths. As Laura Knight-Jadczyk put it,

If the existence of psychopaths and their ability to play us is denied, then their role in government, in business, in the media, in the military, in the police and law, in education, in any place where power is to be had, cannot be understood… Fortunately, researchers such as Lobaczewski, Robert Hare and Paul Babiak are bringing to light the nefarious influence these pathological types play in society. We are beginning to have an understanding of the dynamic between psychopath and non-psychopath, between predator and prey, in individual lives and in society at large.

That is the environment in which we live. If you wish to understand how we are influenced by evil, it is the fact of the existence of the pole of the conscienceless that you must understand. It is the existence of this pole that explains the horrors of human history, not some incurable or permanent predatorial nature at the heart of every human being.

This conscienceless reality continues to exist because the majority of people are ignorant of the facts. They have no knowledge of psychopathy and the role it plays in shaping society. They do not understand that their ideas, their opinions, their thoughts, their dreams, their goals in life are all broadcast out from a group of people who either have no conscience and are incapable of it, or who are willing to do whatever they are asked in order to preserve their own comfort.

To break the rule of the pathocrats, we need knowledge: the knowledge about them and how they work, both on an individual level and on the level of society as a whole. Knowledge, scientific knowledge on psychopathy and ponerology, will permit us to create a pole of conscience that can serve as a counterweight to the pole of the conscienceless. The goal of this knowledge is to eliminate the influence from the other pole by facilitating people to pull themselves out of its field of influence. The 17% or so percent who support the pathocracy would be won away if they were to feel that their security and comfort was bettered served by supporting the other pole.

The goal is not to eliminate physically the psychopaths but to render their manipulations fruitless as more and more people see through them. Knowledge of them and how they manipulate and deceive serves as an inoculation. We can learn to become immune. As this occurs, the weight of the left pole will decrease. If the pathological have no influence, if they can no longer have access to positions of power, gradually, consciencelessness will become nothing but an idea. It will lose its physical manifestations.