By Linh Dinh

Dinh

It’s all going according to plan, this transformation of the US into a police state and Third-World nation, but what’s meant by “Third World,” exactly? A Third World country is one that is poor, with inadequate infrastructure, an obscene wealth gap and a corrupt government. America is by far the most-indebted nation on earth, with a record-setting trade deficit, so we are, in effect, much poorer than Greece, Zimbabwe, Somalia or any other basket case, but it hasn’t become manifest because we have guns, missiles and drones pointing in all directions. Using our gargantuan military to hold the world hostage, we receive more foreign aids, in the form of debts, than all the other nations combined. Riding a nuclear-armed mobility scooter, America is a gross welfare queen barging down the world’s sidewalk, but this is how an empire is supposed to work, many will smirk, and they are right, of course, until this extortion racket falls apart, and soon enough. Preparing for the inevitable, our ruling class is becoming more belligerent abroad, in a last ditch effort to prolong its advantages, and nastier at home, to slap down domestic rage at a sinking standard of living. Splurging beyond our means for decades, we will revert to the universal means, and not because we care about justice or equality, but because we don’t have a choice.

Just as there are pockets of First World opulence and luxury in even the most dismal Third World countries, rich nations also have stretches of Third World squalidness and destitution, but Third World isn’t all bad. Not by far. To survive on little requires enterprise, resourcefulness and cooperation, virtues that will emerge and even blossom as we slide downward. Ubiquitous in most Third World countries, peddlers will make a comeback here, and the black market will thrive. As globalism recedes, the local will rise. Instead of being slaves to huge corporations, we will become tiny businessmen, as long as we’re not hunted down, then fined or locked up. Of course, as work become scarcer and scarcer and manual labor even cheaper than now, many of us will become slaves to our neighbors, as house servants. You will learn to cook, clean, wash, sweep, mop, iron and massage from sunup to lights out, every day. Dressed like Lady Gaga, many mothers and daughters will loiter at street corners.

Back to the positive aspect. Each home can become a store or a restaurant. Each car is a gypsy cab. In totalitarian Vietnam, the government actually gives its people much more leeway to conduct petty business than is allowed in America. A private home can display a table with, say, five cans of soda, two brands of cigarettes and some candies, and that’s a store, though nobody is manning it most of the time. To get service, you might have to shout. It’s not their only source of income, but this pee wee initiative does bring in a buck or two a day, so it’s better than nothing. The adjacent home might sell bags of rice. A third is a two-table café serving coffee, soda and beer, and if you want to eat something, the proprietor will run down the street to get it for you, for a modest surcharge. If you have just one van, you can pick up people at a predetermined spot, where many other vans, unaffiliated to you, also go. Driving passengers to another city, you can also snare business along the way. At just about any street corner, men wait on motorcycles for clients. You negotiate a price for where you want to go, then hop on the back. Just a handful of rides a day will earn each man enough to feed his family. It won’t be steak, but he is self-reliant and his own boss. There is no welfare, food stamps or Social Security in a Third World country, no safety net outside of your extended family.

My Philadelphia neighborhood, the Italian Market, has long boasted or flaunted Third World aspects. In its heydays thirty or forty years ago, it resembled Naples, one of the most Third World-like cities in all of Europe, and now it evokes charming Chihuahua. Here, Italian, Mexican, Chinese and Vietnamese-Americans coexist, and within a five-minute walk from my door, you can get a live chicken, duck or even rabbit, goat meat, ox tails, an Italian tripe sandwich, a beef tongue taco or a Vietnamese rice porridge with pork innards. I’ve had better pho here than in Hanoi, its birthplace, and I’m not kidding. Third World business arrangements are also common. To get Mexican clients, a Chinese-owned barber shop has a Mexican barber, with the split 6-4, in the house’s favor, though the Spanish-speaking haircutter keeps her own tips. Half a mile from me, there’s a restaurant that’s half Mexican, half Vietnamese. Splitting the overhead, two families share a kitchen and operate under one roof.

Left alone, we will figure out a way to scrape by, but it remains to be seen to what degree, and for how long, the government will try to prevent us from surviving on our own. One can say that the United States is becoming a police state because it is turning into a Third World country. Already, choppers snake through skyscraper canyons and tanks roll down main streets. The police state protects and advances the interests of the ruling class, which in our case is the military banking complex, and since an informal market nibbles at the profits of banks and corporations, you can expect their henchmen, cops and regulators, to stomp hard on us smallest fries. (Underpaid in a collapsed economy, cops will also use these opportunities to shake us down, so that’s a kind of tax we’ll have to pay.) In any case, it appears that as we become poorer and thinner, not to mention more enterprising or devious, and more colorful too, since everyday will be casual Friday, we will have to fend off our bullying state, if not the gangs that rise up in its place.

Linh Dinh is the author of two books of stories, five of poems, and a novel, Love Like Hate. He’s tracking our deteriorating socialscape through his frequently updated photo blog, State of the Union.

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By Tara Lohan, AlterNet

 The Oscar-nominated director of Gasland, Josh Fox, released a new 18-minute video that takes his critics to task and issues a call to action on fracking. The Sky Is Pink packs a ton of information into 18 minutes. The film debunks industry lies, like those promoted by former PA governor and Homeland Security chief Tom Ridge, now a gas industry lobbyist. Fox details the “wholesale industrialization” of communities that occurs with fracking and the many risks, not just from polluted water. But don’t just take Fox’s word for it — the film also reveals leaked industry documents that shows that industry does in fact know just how risky their business really is. And if this all sounds very reminiscent of Big Tobacco swearing their product is safe even when they know it’s not — well, that’s because the fracking industry has hired the same PR firm. Check out the video below (or at this link).

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By Paul Craig Roberts

While we think Obama's healthcare reforms are a betrayal of the public interest, and deserve to be scrapped to start anew with a clean slate, this absolutely deranged view of the program by tooconservative.com (a Northern Virginia Republican pod) is sheer and absolute nonsense. Leave it to the rightwing to turn reality upside down.

Growing up in the post-war era (after the Second World War), I never expected to live in the strange Kafkaesque world that exists today. The US government can assassinate any US citizen that the executive branch thinks could possibly be a “threat” to the US government, or throw the hapless citizen into a dungeon for the rest of his or her life without presenting any evidence to a court or obtaining a conviction of any crime, or send the “threat” to a puppet foreign state to be tortured until the “threat” confesses to a crime that never occurred or dies at the hands of “freedom and democracy” while professing innocence.

It has never been revealed how a single citizen, or any number thereof, could possibly comprise a threat to a government that has a trillion plus dollars to spend each year on security and weapons, the world’s largest navy and air force, 700 plus military bases across the world, large numbers of nuclear weapons, 16 intelligence agencies plus the intelligence agencies of its NATO puppet states and the intelligence service of Israel.

Nevertheless, air travelers are subjected to porno-scanning and sexual groping. Cars traveling on Interstate highways can expect to be stopped, with traffic backed up for miles, while Homeland Security and the federalized state or local police conduct searches.

I witnessed one such warrantless search on Easter Sunday. The south bound lanes of I-185 heading into Columbus, Georgia, were at a standstill while black SUV and police car lights flashed. US citizens were treated by “security” forces that they finance as if they were “terrorists” or “domestic extremists,” another undefined class of Americans devoid of constitutional protections.

These events are Kafkaesque in themselves, but they are ever more so when one considers that these extraordinary violations of the US Constitution fail to be overturned in the Supreme Court. Apparently, American citizens lack standing to defend their civil liberties.

Yet, ObamaCare is before the US Supreme Court. The conservative majority might now utilize the “judicial activism” for which conservatives have criticized liberals. Hypocrisy should no longer surprise us. However, the fight over ObamaCare is not worth five cents.

It is extraordinary that “liberals,” “progressives,” “Democrats,” whatever they are, are defending a “health program” that uses public monies to pay private insurance companies and that raises the cost of health care.

Americans have been brainwashed that “a single-payer system is unaffordable” because it is “socialized medicine.” Despite this propaganda, accepted by many Americans, European countries manage to afford single-payer systems. Health care is not a stress, a trauma, an unaffordable expense for European populations. Among the Western Civilized Nations, only the richest, the US, has no universal health care.

The American health care system is the most expensive of all on earth. The reason for the extraordinary expense is the multiple of entities that must make profits. The private doctors must make profits. The private testing centers must make profits.The private specialists who receive the referrals from general practitioners must make profits. The private hospitals must make profits. The private insurance companies must make profits. The profits are a huge cost of health care.

On top of these profits come the costs of preventing and combatting fraud. Because private insurance companies resist paying and Medicare pays a small fraction of the medical charges, private health care providers charge as much as they possibly can, knowing that the payments will be cut to the bone. But a billing mistake of even $300 can bankrupt a health care provider from legal expenses defending him/her self from fraud accusations.

The beauty of a single-payer system is that it takes the profits out of the system. No one has to make profits. Wall Street cannot threaten insurance companies and private health care companies with being taken over because their profits are too low. No health-provider in a single-payer system has to worry about being displaced in a takeover organized by Wall Street because the profits are too low.

Because a single-payer system eliminates the profits that drive up the costs, Wall Street, Insurance companies, and “free market economists” hate a “socialized” medical care system. They prefer a socialized “private” health care system in which public monies flow into private insurance companies.

To make the costs as high as possible, conservatives and the private insurance companies devised ObamaCare. The bill was written by conservative think tanks and the private insurance companies. What the “socialistic” ObamaCare bill does is to take income taxes paid by citizens and use the taxes to subsidize the private medical premiums charges by private health care providers in order to provide “private” health care to US citizens who cannot afford it.

The extremely high costs of ObamaCare is not “socialistic medicine.” ObamaCare is high-cost privatized medicine that guarantees billions of dollars in profits to private insurance companies.

It remains to be seen whether such a ridiculous health care scheme, nowhere extant on earth except in Romney’s Massachusetts, will provide health care or just private profits.

Paul Craig Roberts is an economist, former writer for the Wall Street Journal, and (believe it) a cabinet member in the Reagan administration.

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Andre Damon and Barry Grey, WSWS.ORG

Dimon: "What me worry?"

The economic and political fallout from JPMorgan Chase’s sudden announcement last Thursday night that it lost more than $2 billion from speculative bets on credit derivatives continued to grow on Monday. The biggest US bank announced the forced retirement of Ina Drew, who headed up the bank’s London-based Chief Investment Office, which placed huge bets on the creditworthiness of a collection of US corporations. Other top executives and traders are expected to be sacked or demoted.

The bank’s shares fell another 3.2 percent, bringing its two-day market capitalization loss to nearly $19 billion. The Wall Street Journal reported that JPMorgan was prepared for a total loss of more than $4 billion over the next year from its soured stake in credit default swaps—the same investment vehicle that played a central role in the collapse of Lehman Brothers and the government bailout of insurance giant American International Group (AIG) in September of 2008.

In an interview on NBC’s “Meet the Press” program on Sunday, JPMorgan CEO Jamie Dimon sought to present the loss as an innocent mistake, resulting from “errors, sloppiness and bad judgment.” Only a month ago, Dimon, who has led the public campaign by Wall Street against even the mildest restrictions on speculative banking practices, dismissed warnings over the massive bets being made by his Chief Investment Office as “a complete tempest in a teapot.”

The scale of the loss and the denials that preceded it raise the likelihood that banking rules and laws against investor fraud and deception were breached.

President Obama, however, rushed to the defense of JPMorgan and Dimon, declaring on a daytime television talk show Monday that JPMorgan was “one of the best managed banks there is” and Dimon was “one of the smartest bankers we got.” At the same time he cited the bank’s loss as a vindication of the Dodd-Frank financial regulatory bill that he signed into law in July of 2010. “This is why we passed Wall Street reform,” he said.

In fact, the JPMorgan debacle demonstrates that nearly four years after the Wall Street crash nothing has changed for the financial aristocracy. No measures have been taken to rein in the banks, which received trillions of dollars in government handouts, guarantees and cheap loans. The same forms of speculation and outright swindling that led to the financial meltdown and the worst economic crisis since the Great Depression continue unabated.

The big banks, such as JPMorgan, have increased their stranglehold over the US economy. They have recorded bumper profits by withholding credit from consumers and small businesses, keeping unemployment high, while speculating on credit default swaps and other exotic financial instruments that drain resources from the real economy. On this basis, bank executives and traders, including those at bailed-out institutions, have continued to rake in eight-figure compensation packages. Last year, Ina Drew made $14 million, and Jamie Dimon took in $26 million.

The Dodd-Frank law trumpeted by Obama is a fraud, an attempt to give the appearance of financial reform while enabling the banks to continue their parasitic and criminal activities. A case in point is the so-called Volcker Rule, named after the former chairman of the Federal Reserve and economic adviser to the Obama White House, Paul Volcker.

The rule, incorporated into the Dodd-Frank Act and supposedly one of its most daring provisions, ostensibly bars proprietary trading—speculation by a bank on its own account—by commercial banks whose consumer deposits are guaranteed by the federal government. The idea is to prevent government-insured banks from speculating with depositors’ money.

But the regulation as drafted by federal regulators—under pressure from the Federal Reserve and Obama’s treasury secretary, Timothy Geithner, as well as the banks—would actually allow the type of speculative bet made by JPMorgan in the guise of a “hedge” to offset risk in the bank’s overall investment portfolio.

The Volcker Rule, whose precise form is yet to be announced, will do nothing to halt speculation by government-backed banks using small depositors’ money.

The JPMorgan scandal also throws into relief the government’s failure to prosecute those responsible for the 2008 financial meltdown. Despite overwhelming evidence of wrongdoing and criminality uncovered by two federal investigations last year, those responsible have been shielded from prosecution.

When Iowa Senator Charles Grassley submitted a letter to the Justice Department earlier this year asking how many bank executives had been prosecuted in response to the financial crisis, the Justice Department replied it did not know because it was not keeping a list.

According to a study by Syracuse University, however, federal financial fraud prosecutions have fallen to 20-year lows under the Obama administration, and are down 39 percent since 2003. Under Obama, the number of financial fraud cases has fallen to one-third the level of the Clinton administration.

These facts demonstrate the de facto dictatorship exercised by the financial aristocracy over the entire political system and both major parties. The Obama administration, in particular, is an instrument of the most powerful financial institutions. It has focused its efforts on protecting and increasing the wealth of the privileged elite while utilizing the crisis to permanently slash the wages and living standards of the working class.

For much of Obama’s tenure, Jamie Dimon was known as the White House’s “favorite banker.” According to White House logs, Dimon visited the White House at least 18 times, often to talk to his former subordinate at JPMorgan, William Daley, who had been named White House chief of staff by Obama after the Democratic rout in the 2010 elections.

The incestuous and corrupt relations between Wall Street, the Obama administration and the entire political system underscore the necessity for the working class to build its own mass socialist movement to fight for its interests in opposition to the ruling elite.

The bankers responsible for the financial crisis, including Dimon and his co-conspirators, must be held criminally liable for their lawlessness and held accountable for the social suffering that has resulted from their actions. The ill-gotten trillions accumulated by the banks must be expropriated, with full protection for small depositors and small businesses, and used to provide decent jobs, housing, health care and education for all.

There is no way to rein in the banks and end their socially destructive activities within the framework of the capitalist system. The only way to stop the fraud and parasitism that go on every day on Wall Street is to nationalize the banks and run them as democratically controlled public utilities.

Andre Damon and Barry Grey are senior political analysts with WSWS.ORG, a socialist organization.

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JPChase's chief Dimon: son and grandson of stockbrokers, he's got the Wall Street disease in his blood. Among the highest compensated executives in the world. What's a billion here and a billion there?

By Robert Reich, Robert Reich’s Blog

J.P. Morgan Chase & Co., the nation’s largest bank, whose chief executive, Jamie Dimon, has lead Wall Street’s war against regulation, announced Thursday it had lost $2 billion in trades over the past six weeks and could face an additional $1 billion of losses, due to excessively risky bets.

The bets were “poorly executed” and “poorly monitored,” said Dimon, a result of “many errors, “sloppiness,” and “bad judgment.” But not to worry. “We will admit it, we will fix it and move on.”

Move on? Word on the Street is that J.P. Morgan’s exposure is so large that it can’t dump these bad bets without affecting the market and losing even more money. And given its mammoth size and interlinked connections with every other financial institution, anything that shakes J.P. Morgan is likely to rock the rest of the Street.

Ever since the start of the banking crisis in 2008, Dimon has been arguing that more government regulation of Wall Street is unnecessary. Last year he vehemently and loudly opposed the so-called Volcker rule, itself a watered-down version of the old Glass-Steagall Act that used to separate commercial from investment banking before it was repealed in 1999, saying it would unnecessarily impinge on derivative trading (the lucrative practice of making bets on bets) and hedging (using some bets to offset the risks of other bets).

Dimon argued that the financial system could be trusted; that the near-meltdown of 2008 was a perfect storm that would never happen again.

Since then, J.P. Morgan’s lobbyists and lawyers have done everything in their power to eviscerate the Volcker rule — creating exceptions, exemptions, and loopholes that effectively allow any big bank to go on doing most of the derivative trading it was doing before the near-meltdown.

And now — only a few years after the banking crisis that forced American taxpayers to bail out the Street, caused home values to plunge by more than 30 percent and pushed millions of homeowners underwater, threatened or diminished the savings of millions more, and sent the entire American economy hurtling into the worst downturn since the Great Depression — J.P. Morgan Chase recapitulates the whole debacle with the same kind of errors, sloppiness, bad judgment, excessively risky trades poorly-executed and poorly-monitored, that caused the crisis in the first place.

In light of all this, Jamie Dimon’s promise that J.P. Morgan will “fix it and move on” is not reassuring.

The losses here had been mounting for at least six weeks, according to Morgan. Where was the new transparency that’s supposed to allow regulators to catch these things before they get out of hand?

Several weeks ago there were rumors about a London-based Morgan trader making huge high-stakes bets, causing excessive volatility in derivatives markets. When asked about it then, Dimon called it “a complete tempest in a teapot.” Using the same argument he has used to fend off regulation of derivatives, he told investors that “every bank has a major portfolio” and “in those portfolios you make investments that you think are wise to offset your exposures.”

Let’s hope Morgan’s losses don’t turn into another crisis of confidence and they don’t spread to the rest of the financial sector.

But let’s also stop hoping Wall Street will mend itself. What just happened at J.P. Morgan – along with its leader’s cavalier dismissal followed by lame reassurance – reveals how fragile and opaque the banking system continues to be, why Glass-Steagall must be resurrected, and why the Dallas Fed’s recent recommendation that Wall Street’s giant banks be broken up should be heeded.

Robert B. Reich has served in three national administrations, most recently as secretary of labor under President Bill Clinton. He also served on President Obama’s transition advisory board. His latest book is Aftershock: The Next Economy and America’s Future. His homepage is www.robertreich.org.

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It’s really up to you. Do your part while you can. •••

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