by Stephen Lendman

From January 26, 2009 – January 25, 2013, he was Obama’s Treasury Secretary. He and Fed chairman Bernanke engineered crisis conditions.  Bankers profited hugely. They still do. Ordinary people were scammed. Geithner’s gone. His legacy speaks for itself. His background showed what to expect. He spent three years at Kissinger Associates.

From 1988 – 2002, he held various Treasury posts. He left to become Council on Foreign Relations international economics department senior fellow.  From 2001 – 2003, he was IMF Policy Development and Review director. He left to become New York Fed president. He partnered with Treasury Secretary Hank Paulson and Bernanke. They planned the grandest of grand thefts. They implemented banker bailouts. They looted the federal treasury. They stuck taxpayers with the bill. They debased the currency. They transformed America into an unprecedented money making racket.

As New York Federal Reserve Bank president/vice chairman of the Fed Open Market Committee (FOMC), Geithner helped engineer crisis conditions. As Treasury Secretary, he exacerbated them. He turned them into a protracted mainstream depression. In November 2008, Michel Chossudovsky asked “Who are the Architects of Economic Collapse?”

The “financial meltdown (wasn’t) the result of a cyclical economic phenomenon.” It was willful government policy. It was implemented “through the Treasury and the US Federal Reserve Board.”

It was and remains “the most serious economic crisis in World history.” Banker bailouts exacerbated crisis conditions. They “trigger(ed) an unprecedented concentration of wealth.”

Economic and social inequality followed. Indebtedness “skyrocketed.” Everything that happened was planned. Robbing poor Peter to pay rich Paul became policy. Geithner and Bernanke bear full responsibility. They partnered in crime. Neil Barofsky was Troubled Asset Relief Program (TARP) watchdog. He served as SIGTARP (Special Inspector General for TARP).

In July 2009, he estimated the initial $700 billion bailout could balloon to $23.7 trillion. He said Obama administration secrecy concealed what’s essential to reveal. Trillions were stolen. From $9 to $14 trillion is known. Estimates range to multiples that amount. Corrupt bureaucrats and crooked bankers alone know how much.

Five major ones matter most: JP Morgan Chase, Bank of America, Citibank, Goldman Sachs and Wells Fargo. They reflect more than too big to fail. What they say goes. They occupy Washington. They run America. They dictate policy.

Geithner and Bernanke are crime bosses. They’re complicit in grand theft. They abandoned Main Street for Wall Street. They know where the bodies are buried. They know the harm they caused. Bankers got bailouts. Ordinary people were lied to and scammed. Geithner and Bernanke exceeded the worst of Bush administration policies. Too big to fail became a license to steal.

They serve Wall Street giants. They engineering a financial coup d’etat. They created a fraudulent housing and debt bubble. They illegally shifted vast amounts of capital offshore. Privatization became piracy. It was used is as pretext to shift government assets to private investors. They did so at below-market prices.

At the same time, they moved private liabilities to government. They did it at no cost to private interests.

They’re waging war on middle America. They want social societies destroyed. They want banana republics replacing them. Labor is earmarked for destruction. Totalitarian neoliberal rule is planned.

Days before he left, he called his bailout scheme doomed to be unpopular. “You look like you’re giving aid to the arsonist,” he said.  He claims history will judge him more kindly. He turned reality on its head. He wrecked the economy. He claims he saved it. He didn’t avoid a Great Depression. He caused one.

He didn’t save millions of jobs. He destroyed them. He engineered fake financial reform. He capitulated to Wall Street. He avoided real change. He advanced global monetary control. He did it at the expense of fairness. He took advantage of a corrupted system. It’s crisis-prone, unstable, anarchic, ungovernable, and self-destructive. It repeats boom and bust cycles.

Crooks run monetary and fiscal policy. Recessions and depressions follow. Ordinary people are hurt most. Bankers and other financial giants profit enormously. Add money laundering to their profit centers.

Money power controls America. Policy facilitates grand theft. Too big to fail banks consolidate. They become larger and more powerful. They game the system for profit. They gamble with public money. They wage financial war on humanity. Massive fraud facilitates private gain. Reform is a figure of speech.

Last July, New York Fed documents implicated Geithner in rigging Libor (the London Interbank Offered Rate). It’s a fundamental rate-setting benchmark. It’s set daily between UK banks for overnight to 12 month durations.

It’s produced for ten currencies with 15 maturities. It represents the London market’s lowest cost of unsecured funding. It’s the primary global short-term rate benchmark. Last summer’s scandal reflected a cesspool of financial fraud. Manipulating the rate up lets banks steal countless billions in inflated loan costs.

Downward manipulation deprives states, communities, pension funds, ordinary investors, and retirees of similar amounts from fixed income holdings. As New York Fed president and Treasury Secretary, Geithner was complicit in fraud. His mandate was to facilitate it. He didn’t disappoint.

Instead of fixing a corrupted system, he advanced and exacerbated it. He turned crisis conditions into disaster. He and Bernanke share honors as public enemy number one.  They’re world class scoundrels. They gave away the store to Wall Street. They laid foundational plans for greater grand theft. In real democracies, they’d be in prison. Washington will have to explain why not.

Stephen Lendman lives in Chicago and can be reached at lendmanstephen@sbcglobal.net. His new book is titled “Banker Occupation: Waging Financial War on Humanity.”
http://www.claritypress.com/LendmanII.html

Visit his blog site at sjlendman.blogspot.com and listen to cutting-edge discussions with distinguished guests on the Progressive Radio News Hour on the Progressive Radio Network Thursdays at 10AM US Central time and Saturdays and Sundays at noon. All programs are archived for easy listening.

http://www.progressiveradionetwork.com/the-progressive-news-hour
http://www.dailycensored.com/tim-geithners-legacy-of-shame/

“Hell is Truth Seen Too Late”
The Parable of the Frogs
by MORRIS BERMAN
One who knows “enough is enough” always has enough.–Tao Te Ching

What does it take to produce large-scale social change?  Most historians, if you catch them in an honest moment, will admit that the popular levers of social change, such as education or legislation, are bogus; they don’t really amount to very much.  What does make a difference–and then only potentially–is massive systemic breakdown, such as occurred in the United States in the fall of 2008.  It was the greatest market crash since 1929, leading to widespread unemployment (something like 18% of the population, in real–as opposed to official–statistics*) and the loss of billions of dollars in retirement savings.  In fact, the crash  wiped out $11.1 trillion in household wealth, and this is not counting the several trillion lost in stock market investments. 

It had been many decades since the middle class found itself in soup kitchens, and yet there they were.  In the face of all this, however, very little seems to have changed.  Americans are still committed to the dream of unlimited abundance as a “reasonable” goal, when in reality it is (and always has been) the dream of an addict.  President Obama’s upwards of $19 trillion bailout and stimulus plan funneled money into the very banking establishment that gave us the disaster; it rescued the wealthy, not those who really needed the money.  And while he could have appointed economic advisers such as Paul Krugman and Joseph Stiglitz (both Nobel laureates), who would have attempted to put the nation on a different economic path, he chose instead two traditional neoliberal ideologues, Timothy Geithner and Lawrence Summers, who believe in the very policies that led to the crash.  “Change we can believe in” never sounded more hollow.

The metaphor of addiction is extremely relevant to situations such as these, because addicts always seek to maximize their intake (or behavior) rather than optimize it, even though the former leads to self-destruction.  In the face of what seems to be biologically driven activity, reason doesn’t have much of a chance.  An experiment with frogs some years ago demonstrated this quite clearly.  They were wired up with electrodes in the pleasure center of the brain, and could stimulate that center–i.e., create a “rush”–by pressing a metal bar.  Not only did the frogs keep pressing the bar over and over again, but they didn’t stop even when their legs were cut off with a pair of shears!  And if you are going to object that human beings are not frogs, then you probably haven’t been reading the daily newspapers, or observing the behavior of the people around you.

There are, of course, a few intelligent frogs around, ones who struggle to point out the difference between optima and maxima.  One such was the anthropologist Gregory Bateson, perhaps most famous for having been married to Margaret Mead.  For Bateson, the issue was an ethical one.  As he himself put it, “the ethics of optima and the ethics of maxima are totally different ethical systems.”  The ethics of maxima knows only one rule: more.  More is better, in this scheme of things; words such as “limits” or “enough” are either foolish or meaningless.  Clearly, the “American Dream” is a system of maxima, of indefinite expansion.

But what if the reality of all social systems is that they are homeostatic, which is to say, designed to stay in balance?  In that case, said Bateson, the attempt to maximize any single variable (for example, wealth) will eventually push the system into runaway, such that it will destroy itself.  To take a physiological analogy, we recognize that the human body needs only so much calcium per day.  We do not say, “The more calcium I ingest, the better off I’ll be,” because we recognize that past a certain point any chemical element becomes toxic to an organism.  Yet we seem to be unable to extend this insight to the social or economic realm.  We do not say, for example, “That company is making too much profit,” or “That individual (Bill Gates, Carlos Slim) has too much money for one person,” or “The Gross Domestic Product is spinning out of control.”  Rather than being interested in balance, in stability, we are fascinated by asymptotes–frogs at the bar of pleasure, even while our legs are being cut off.  We don’t get it, that if you fight the ecology of a system, you lose, especially when you “win.”

Maximizing a single variable, wrote Bateson, can seem like an ingenious adaptation, but over time it typically turns into pathology.  The saber teeth of a tiger may have had short-range survival value, but this development weakened its flexibility in other situations that proved to be crucial.  The “favored” species became so “favored” that it destroyed its own ecological niche, and disappeared.  A gain at one level became a calamity at another.

A few years ago, two American scholars of the intelligent frog variety began to
understand this line of reasoning and to conclude from it that Adam Smith, with his theory of the “invisible hand,” was wrong.  An early (much milder) version of Gordon Gekko, with his eulogy of greed (in Oliver Stone’s 1987 film, Wall Street), Smith argued that the collective result of individual self-interest was the prosperity of the whole.  But the economist Robert Frank, writing in the New York Times (12 July 2009), argued that “traits that help individuals are harmful to larger groups.  For instance,” he went on,

a mutation for larger antlers served the reproductive interests of an individual male elk, because it helped him prevail in battles with other males for access to mates.  But as this mutation spread, it started an arms race that made life more hazardous for male elk over all.  The antlers of male elk can now span five feet or more.  And despite their utility in battle, they often become a fatal handicap when predators pursue males into dense woods.

In the case of the market, said Frank, individual reward structures undermine the invisible hand.  “To make their funds more attractive to investors,” he wrote, “money managers create complex securities that impose serious, if often well-camouflaged, risks on society.  But when all managers take such steps, they are mutually offsetting.  No one benefits, yet the risk of financial crises rises sharply.”

Similarly, U.S. Appeals Court Judge Richard Posner, in A Failure of Capitalism, pointed out that the crash of 2008 was brought about by individual actions that were actually quite rational: bankers and investors pursuing their own interests.  Reckless behavior was quite consistent, he said, with being well informed about the risks involved in the context of an economic bubble, and so a great many money managers took those risks.  The problem is that what was rational on the individual level was irrational on the collective level, thus leading to a systemic collapse.

We are thus led, quite naturally, from a consideration of optima vs. maxima to the question of individual vs. collective behavior.  Which brings me to one of the twentieth century’s most intelligent frogs, the biologist Garrett Hardin, who posed the dilemma in a famous essay entitled “The Tragedy of the Commons” (1968).  Consider, said Hardin, the example of a pasture shared by local herders.  They all understand that the commons belongs to no one in particular, but supports the well-being of all and is the responsibility of all.  One day, however, one of the herders puts an additional animal out to graze, with the result that he increases his yield.  As a result, the pasture is slightly degraded.  Meanwhile, other herders come to the same conclusion, and as each makes the rational decision to take advantage of the situation for personal gain, the net result is the overgrazing, and ultimately the destruction, of the common area.  In a word, the system favors selfish individuals over those with greater foresight and restraint.  Or as Hardin put it, “Freedom in a commons brings ruin to all.”  Frogs, in a word, are not to be trusted.

How, then, can excess be curbed in a free democratic system?  For we can be sure that the intelligent frogs, who are really quite exceptional, are not going to be listened to, and certainly have no power to enforce their insights.  True, there are certain countries–the Scandanavian nations come to mind–where for some reason the concentration of intelligent frogs is unusually high, resulting in decisions designed to protect the commons.  But on a world scale, this is not very typical.  More typical, and (sad to say) a model for many other countries, is the United States, where proposed “changes” are in fact cosmetic, and where the reality is business as usual.  In the context of 315 million highly addicted frogs, the voices of the smart ones–Bateson, Frank, Posner, Hardin, et al.–aren’t going to have much impact or, truth be told, even get heard.

Of course, authoritarian systems don’t have these problems, which is a good indicator of how things will probably develop.  Under the name of “harmony,” for example, China regulates its citizens for what it perceives to be the common good.  Hence the famous one-child policy, introduced in 1979, supposedly prevented more than 300 million births over the next twenty-nine years in a country that was threatened by its own population density.  In the case of the United States, the imposition of rules and limits on individual behavior to protect the commons is not, at present, a realistic prospect; the population is simply not having it.  But how much longer before this freedom of choice is regarded as an impossible luxury?  In fact, no crystal ball is required to predict the future here.  The tragedy of the commons–what Hardin called “the remorseless working of things”–is that a society such as that of the United States won’t undertake serious changes even when it is sitting on the edge of an abyss.  It has to actually be in the abyss before it will entertain such changes; i.e., it has to be faced with no choice at all.  It seems unlikely now, but things are probably moving faster than we realize.  In terms of population, energy, food, resources, water, social inequality, public health, and environmental degradation, a crunch of the type I am referring to may be only twenty years away.

In Shakespeare’s Two Gentlemen of Verona, the character Valentine is confronted by an outlaw, who asks him if he is content “To make a virtue of necessity/And live, as we do, in this wilderness?”  That may prove to be the only “choice” we have.  As Thomas Hobbes put it a few decades after Shakespeare, “Hell is truth seen too late.”

*These data are easily manipulated by the government to make things look better than they actually are.  For example, individuals collecting unemployment insurance for a few months are officially unemployed, but once that support dries up they are no longer among the statistics of the unemployed even though they are still out of work.  In addition, the millions of Americans who are underemployed, who work only a few hours per week, are included in the ranks of the employed.  Between 2006 and 2009, 20% of American workers were laid off; 50 million live in real poverty, and many more in a category called “near poverty.” Joseph Stiglitz has a good discussion of this in Freefall (New York: W.W. Norton, 2010).

Morris Berman’s latest book is Why America Failed.

With every good wish, Dr. Steve Jonas

The Koch Brothers, Superstorm Sandy, and the Teabaggers

STEVEN JONAS MD, MPH

I used to think that the Teabaggers were a wholly-owned subsidiary of the GOP. They were very convenient to the not-so-grand, but very old in its ways, party. From the time they were first organized by old Republican hands like Dick Armey in 2009 to when they marched into the House of Representatives in 2011, their political agenda was in fact little different from that of “mainstream” (that is, since the “Gingrich revolution” highly reactionary) Republicanism: tax-cuts forever (for Grover; in fact zero taxes would be nice except that the parts of the government they like, like the military- and prison-industrial complexes, do need to be paid for somehow), “small government” (except that getting into people’s beds and drug-use patterns and women’s vaginas and wombs is absolutely mandatory); guns are sacred (ever wonder what the proportion of Viagra/Cialis sales among male gun-owners is vs. that of male non-gun-owners); separation of church and state means keeping atheists like me out of the public square and certainly out of elected office; and so-on and so-forth.

But the Teabaggers were rather louder about the regular GOP agenda, and could be quite shrill about it even to the point of embarrassment (see Cong. Akin and Bachmann). Thus the so-called “mainstreamers,” like Mitch (our-no.-1-goal-is-to-keep-Obama-from-getting-a-second-term) McConnell, and John (Nice Tan) Boehner could claim that “well, at least we’re not like them.” Yes, while they were really true Republicans, at the same time they offered an excuse that the leadership could trot out for their NO compromise positions — “after all, folks, they’ve got lots of votes.” A nice foil, if you will, and one that is even more powerful at many of the state levels than at the national.

However, the horrible episode that is unfolding around Superstorm Sandy Relief and the resistance of the Teabagger-controlled House of Representatives is now indicating that the they are really a wholly-owned (yes, bought and paid-for) subsidiary of the Koch Brothers, their own political action committee, Americans for Prosperity [of the Ultra-Rich] (AfP), and their brothers-in-arms at the Club for Growth, the Heritage Foundation (funded in part by the Koch Brothers), the Cato Institute (founded in part by the Koch brothers), and so on and so forth.

Consider the following statement that came from the AfP in New Jersey about the proposed Sandy-reconstruction aid bill in the Congress (1; see also 2):

“New Jersey’s Americans for Prosperity State Director [Steve] Lonegan called on legislators to reject the bill, saying that aid would be a burden on the country’s taxpayers and would be misspent at all levels of government by officials glomming for every last nickel. The bill, he said, would lead to a spending free-for-all and is merely an attempt to secure funding for wasteful endeavors by appealing to emotion. ‘Tragic things happen every day to people – worse things than having your house flood – and we don’t hand them a check,’ he said. ‘Having your shore house flood doesn’t rank. This is not a federal government responsibility. We need to suck it up and be responsible for taking care of ourselves.’ New Jersey Governor Chris Christie’s disaster estimate of nearly $37 billion is tantamount to a $119.51 tax increase for every single American, should the U.S. have to foot the bill, Lonegan said, adding that he doubted that much aid would even reach affected residents. With the country facing a fiscal cliff, Lonegan said Sandy aid shouldn’t be a priority now.”

So suddenly Republicans like Gov. Chris (everything-that’s-wrong-in-this-state-can-be- blamed-on-the-teachers) Christie become “mainstream” and are actually fighting the Koch/Teabaggers over getting Federal aid to his state. This is, of course, because if he doesn’t get it, he is toast in the next election.

But the position the Teabaggers are taking is right out of the Koch Brothers playbook and since the Kochs and their ultra-rich colleagues put these folks in the Congress, there is no reason to believe that they are going to back down. For they reflect the Koch’s political- economic philosophy, which goes back to that of their father Fred, one of the founders in the 1950s of the virulently anti-communist, anti-Soviet, John Birch society. It is well summed up in a few sentences from an article Charles Koch published in Newsmax last August which, funnily enough, focuses on comparisons with the Soviet Union in its last throes in the early 1990s (3):

“My experiences in the Soviet Union [in 1990] underscore why economic freedom is so important for all of us. Nations with the greatest degree of economic freedom tend to have citizens who are much better off in every way. No centralized government, no matter how big, how smart or how powerful, can effectively and efficiently control much of society in a beneficial way. On the contrary, big governments are inherently inefficient and harmful. And yet, the tendency of our own government here in the U.S. has been to grow bigger and bigger, controlling more and more. This is why America keeps dropping in the annual ranking of economic freedom. Citizens who over-rely on their government to do everything not only become dependent on their government, they end up having to do whatever the government demands. In the meantime, their initiative and self-respect are destroyed.”

Parallel to this is of course the Koch Brothers’ desperate fight against government regulation of industry, especially their primary one, petroleum, which underlies their constant campaign against the science of global warming (e.g., 4). How ironic that this fake “study” is coming out just around the time when the reports are coming out (5, 6) that 2012 was the hottest year on record, and directly linked by multiple rapporteurs to human-caused global warming. (That the Koch Brothers are certainly smart and well-educated enough to know that human-caused global warming is real, unlike folks like Limbaugh and Hannity who are stupid and ill-educated enough to probably really believe it when they preach, over-and-over again that “it is a leftist-hoax,” make what the Kochs are doing on global warming/climate change even more reprehensible, indeed villainous.)

Now the Teabaggers may eventually cave on this one, although one of their leaders, House Majority Leader Eric Cantor, has said that every dollar for Sandy Aid, if it is indeed to be appropriated, must be matched by a dollar cut elsewhere (except on the military, agribusiness, and etc. of course). But the Teabaggers are now openly marching to the beatof the Koch Brothers Band. If the American people in general, and the progressive wing of the Democratic Party in particular, don’t wake up to this reality soon and begin to take it on aggressively and directly, global warming and its progeny like Superstorm Sandy are only going to make life miserable for an ever-increasing number of Americans. There are indeed some authorities who believe that we may already have passed the point of irreversibility (7).

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1. “David Koch Wants to Stop Funding Relief to Hurricane Sandy Victims,” http://www.patheos.com/blogs/wwjtd/2012/12/david-koch-wants-to-stop-relief-funding-to-hurricane-sandy-victims/

2. “Lonegan Urges Congress to Reject Ridiculous Sandy Aid,’ http://americansforprosperity.org/new-jersey/newsroom/pr-lonegan-urges-congress-to-reject-ridiculous-60-b-sandy-aid-request/

3. “Charles Koch: Why We Fight for Economic Freedom,” http://www.newsmax.com/Headline/charles-koch-economy-freedom/2012/08/15/id/448700?s=al&promo_code=FC45-1.

4. Gibson, C., “Koch Brothers Produce Counterfeit Climate Report to Deceive Congress,” http://www.nationofchange.org/koch-brothers-produce-counterfeit-climate-report-deceive-congress-1350999952.

5. Cole, Juan, “Frankenyear, 2012,” http://readersupportednews.org/opinion2/271-38/15469-focus–frankenyear-2012-hottest-on-record.

6. Gillis, J., “Not Even Close, 2012 Was Hottest Ever in U.S.,” http://www.nytimes.com/2013/01/09/science/earth/2012-was-hottest-year-ever-in-us.html?_r=0

7. McKibben, B., “Time is Not on Our Side,” http://www.tomdispatch.com/post/175634/tomgram%3A_bill_mckibben%2C_time_is_not_on_our_side/?utm_source=TomDispatch&utm_campaign=a35d3052b6-TD_McKibben1_6_2013&utm_medium=email#more

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Steven Jonas, MD, MPH is a Professor of Preventive Medicine at Stony Brook University (NY) and author/co-author/editor/co-editor of over 30 books. In addition to being a columnist for BuzzFlash@Truthout, and The Greanville Post,  he is the Managing Editor of and a Contributing Author to The Political Junkies for Progressive Democracy (http://thepoliticaljunkies.org/)

By Peter Hart, FAIR

If there’s one thing media want you to know about Venezuelan president Hugo Chavez, it’s that he doesn’t like the United States.  On the PBS NewsHour (1/10/13), Ray Suarez told viewers that Chavez antagonized Washington, it seemed, whenever he could, forging friendships with Iran’s Mahmoud Abbas, Syria’s embattled Bashar al-Assad, and he formed an especially close bond with Cuban Presidents Fidel and Raul Castro.

On the CBS Evening News (1/8/13), Scott Pelley said: “Chavez has made a career out of bashing the United States and allied himself with Iran and Syria.”  While it’s hard to say Chavez has made a “career” out of U.S.-bashing–he does have, after all, a full-time job as president of Venezuela–you, too, might be excused for harboring some hard feelings towards a government that helped to try to overthrow your own. Which may be why U.S. reports rarely bring up the 2002 coup attempt–and when they do, treat Washington’s involvement in it as another nutty Chavez conspiracy theory.

Here’s Juan Forero in the Washington Post (1/10/13): A central ideological pillar of Chavez’s rule over 14 years has been to oppose Republican and Democratic administrations in Washington, which he accuses of trying to destabilize his government. “I think they really believe it, that we are out there at some level to do them ill,” said Charles Shapiro, president of the Institute of the Americas, a think tank in San Diego.

As ambassador to Venezuela from 2002 to 2004, Shapiro met with Chavez and other high- ranking officials, including [Vice President Nicolas] Maduro. But the relationship began to fall apart, with Chavez accusing the United States of supporting a coup that briefly ousted him from power. U.S. officials have long denied the charge. Shapiro recalled how Maduro made what he called unsubstantiated accusations about CIA activity in Venezuela, without ever approaching the embassy with a complaint. He said that as time went by, the United States became a useful foil for Chavez and most Venezuelan officials withdrew contact.

“A sure way to ruin your career, to become a backbencher, was to become too friendly with the U.S. Embassy,” Shapiro said. So Venezuela has a strange political culture where being friendly with the U.S. government gets you in trouble.

The Post airs Chavez’s charge–and then the U.S. denial. But the United States had all sorts of contact with the coup plotters before they made their move against Chavez in 2002. According to the State Department (7/02): It is clear that NED [National Endowment for Democracy], Department of Defense (DOD) and other U.S. assistance programs provided training, institution building and other support to individuals and organizations understood to be actively involved in the brief ouster of the Chavez government.

And the CIA, as was reported by Forero himself (New York Times, 12/3/04), knew of the coup plotting.

The Central Intelligence Agency was aware that dissident military officers and opposition figures in Venezuela were planning a coup against President Hugo Chávez in 2002, newly declassified intelligence documents show. But immediately after the overthrow, the Bush administration blamed Mr. Chávez, a left-leaning populist, for his own downfall and denied knowing about the threats.

Scott Wilson, who was the Washington Post foreign editor at the time, told Oliver Stone for his film South of the Border:

Yes, the United States was hosting people involved in the coup before it happened. There was involvement of U.S.-sponsored NGOs in training some of the people that were involved in the coup. And in the immediate aftermath of the coup, the United States government said that it was a resignation, not a coup, effectively recognizing the government that took office very briefly until President Chavez returned.

And we know that the United States made quick efforts to have the coup government recognized as legitimate. The Bush government, immediately after the coup, blamed it on Chavez. And some of the coup plotters met with officials at the U.S. embassy in Caracas before they acted.  But the important thing for readers to know, according to Wilson’s successors at the Washington Post, is that U.S. officials deny they supported anything.

PETER HART is a senior political/media analyst with FAIR.

By Dave Johnson, blog.ourfuture.org

Many people don’t understand our country’s problem of concentration of income and wealth because they don’t see it. People just don’t understand how much wealth there is at the top now. The wealth at the top is so extreme that it is beyond most people’s ability to comprehend.

If people understood just how concentrated wealth has become in our country and the effect is has on our politics, our democracy and our people, they would demand our politicians do something about it.

How Much Is A Billion?

Some Wall Street types (and others) make over a billion dollars a year – each year. How much is a billion dollars? How can you visualize an amount of money so high? Here is one way to think about it: The median income in the US is around $29,000, meaning half of us make less and half make more. If you make $29,000 a year, and don’t spend a single penny of it, it will take you 34,482 years to save a billion dollars. . . . (Please come back and read the rest of this after you have recovered.)

What Do People Do With SO Much?

What do people do with all that money? Good question. After you own a stable of politicians who will cut your taxes, there are still a few more things you can buy. Let’s see what $1 billion will buy.

Cars

This is a Maybach. Most people don’t even know there is something called a Maybach. The one in the picture, the Landaulet model, costs $1 million. (Rush Limbaugh, who has 5 homes in Palm Beach, drives a cheaper Maybach 57 S — but makes up for it by owning 6 of them.)

Your $1 billion will only buy you a thousand Maybach Landaulets.

Here are pics of just some of Ralph Lauren’s collection of cars. This is not a museum, this is one person’s private collection. You don’t get to go look at them.

Luxury Hotels

This is the Mardan Palace Hotel in Turkey, Burj Al Arab in Dubai.

Here is a photo gallery of some other expensive hotels, where people pay $20-30,000 per night. Yes, there are people who pay that much. Remember to send me a postcard!

A billion dollars will buy you a $20,000 room every night for 137 years.

Yachts

Le Grand Bleu – $90 million.

Some people spend as much as $200 million or more on yachts.

You can buy ten $100 million yachts with a billion dollars.

Private Jets

Of course, there are private jets. There are approx. 15,000 private jets registered in the US according to NBAA. (Note: See the IPS High-Flyers study.)

This is a Gulfstream G550. You can pick one up for around $40 million, depending. Maybe $60 million top-of-the-line.

Your billion will buy you 25 of these.

Private Islands

If the rabble are getting you down you can always escape to a private island.

This one is going for only $24.5 million – castle included. You can only buy 40 of these with your billion.

Mansions

This modest home (it actually is, for the neighborhood it is in) is offered right now at only about $8 million. I ride my bike past it on my regular exercise route, while I think about how the top tax rate used to be high enough to have good courts, schools & roads and counter the Soviet Union and we didn’t even have deficits.

I ride there but that neighborhood is not like my neighborhood at all. While there is one family in that house, I live closer to the nearby soup kitchen that serves hundreds of families. One family in a huge estate and hundreds at a soup kitchen roughly matches the ratio of wealth concentration described below.

Here are a few nearby homes up for sale.

You can buy 125 houses like this one with your billion.

Luxury Items

Here is an article about ten watches that are more expensive than a Ferrari.

The one in this picture costs more than $5 million. You can buy 200 of these with your billion.

Medieval Castles

Just for fun, this is Derneburg Castle. Do you remember the big oil-price runup a few years ago that sent the price of a gallon at the pump up towards $5? One speculator who helped make that happen got a huge bonus paid with government bailout money. He owns this castle. He has filled it with rare art. You can’t go in and see any of the rare art.

Click here to see the layout in an aerial view. That’s as close as you’re going to get, peasant.

Let’s Go Shopping

So you say to yourself, “I want me some of that. I’d like to place the following order, please.”

One Maybach Landaulet for $1 million to drive around in. (Actually to be driven around in.)
One $100 million yacht for when I want to get seasick.
One Gulfstream G550 private jet for $40 million.
One private island for $24.5 million (castle included) for when I want to escape the masses.
One $8 million estate for when I have to go ashore and mingle with the masses (but not too close.)
One $5 million watch so I can have one.
Total: $178.5 million.

My change after paying with a billion-dollar bill is a meager $821.5 million left over. I might be hard up for cash after my spending spree, but I can still stay in a $20,000 room every night for 112 and 1/2 years.

So, as you see, $1 billion is more than enough to really live it up. People today are amassing multiples of billions, paying very little in taxes and using it in ways that harm the rest of us.

How Extreme Is The Concentration?

Now you have a way to visualize just how much money is concentrated at the very top. And the concentration is increasing. The top 1% took in 23.5% of all of the country’s income in 2007. In 1979 they only took in 8.9%.

It is concentrating at the expense of the rest of us. Between 1979 and 2008, the top 5% of American families saw their real incomes increase 73%, according to Census data. Over the same period, the lowest-income fifth (20% of us) saw a decrease in real income of 4.1%. The rest were just stagnant or saw very little increase. This is why people are borrowing more and more, falling further and further behind. (From the Working Group on Extreme Inequality)

Income VS Wealth

There are a few people who make hundreds of millions of income in a single year. Some people make more than $1 billion in a year.  But that is in a single year. If you make vast sums every year, after a while it starts to add up. (And then there is the story of inherited wealth, passed down and growing for generation after generation…)

Top 1% owns more than 90% of us combined. “In 2007, the latest year for which figures are available from the Federal Reserve Board, the richest 1% of U.S. households owned 33.8% of the nation’s private wealth. That’s more than the combined wealth of the bottom 90 percent.” (Also from the Working Group on Extreme Inequality)

400 people have as much wealth as half of our population. The combined net worth of the Forbes 400 wealthiest Americans in 2007: $1.5 trillion. The combined net worth of the poorest 50% of American households: $1.6 trillion.

Corporate wealth is also personal wealth. When you hear about corporations doing well, think about this chart:

The top 1% also own 50.9% of all stocks, bonds, and mutual fund assets. The top 10% own 90.3%.

Worse Than Egypt

In fact our country’s concentration of wealth is worse than Egypt. Richard Eskow writes,

Imagine: A government run by and for the rich and powerful. Leaders who lecture others about “sacrifice” and deficits while cutting taxes for corporations and the wealthy. A system so corrupt that rich executives can break the law without fear of being punished. Increasing poverty and hardship even as the stock market rises. And now, a nation caught between a broken political system and a populist movement that could be hijacked by religious extremists at any moment. Here’s the reality: Income inequality is actually greater in the United States than it is in Egypt. Politicians here have close financial ties to big corporations, both personally and through their campaigns. Corporate lawbreakers often do go unpunished. Poverty and unemployment statistics for US minorities are surprisingly similar to Egypt’s.

The Harmful Effect on The Rest Of Us

This concentration is having a harmful effect on the rest of us, and even on the wealthy. When income becomes so concentrated people who would otherwise think they are well off look up the ladder, see vastly more wealth accumulating, and think they are not doing all that well after all. This leads to dissatisfaction and risk-taking, in an effort to get even more. And this risk-taking is what leads to financial collapse.

Aside from the resultant risk of financial collapse, the effect of so much in the hands of so few is also bad psychologically. People need to feel they earned that they have earned what they have, and develop theories about why they have so much when others do not. Bizzare and cruel explanations like Ayn Rand’s psychopathic theories about “producers” and “parasites” take hold. Regular people become little more than commodities, blamed for their misery (“personal responsibility”) as they become ever poorer.

Teddy Roosevelt, speaking to the educators about “False Standards Resulting From Swollen Fortunes,” warned that while teachers believe their ideals to be worth sacrifice and so do non-renumerative work for the good of others, seeing great wealth makes people think that obtaining wealth is itself a lofty ideal,

The chief harm done by men of swollen fortune to the community is not the harm that the demagogue is apt to depict as springing from their actions, but the effect that their success sets up a false standard, and serves as a bad example to the rest of us. If we do not ourselves attach an exaggerated importance to the rich man who is distinguished only by his riches, this rich man would have a most insignificant influence over us.

Societies that are more equal do better. In the book The Spirit Level: Why More Equal Societies Almost Always Do Better, Richard G. Wilkinson and Kate Pickett make the case that great inequality harms us physically as well as spiritually, and the these harmful effects show up across society. The book examines social relations, mental health, drug use, physical health, life expectancy, violence, social mobility and other effects and show how inequality worsens each.

Influence Buying

There is a problem of the effect on our democracy from the influence that extreme, concentrated wealth buys. In the book Winner-Take-All Politics: How Washington Made the Rich Richer–and Turned Its Back on the Middle Class, Jacob Hacker and Paul Pierson make the case that the anti-democracy changes we have seen in America since the late 1970s that led to intense concentration of wealth and income are the intentional result of an organized campaign by the wealthy and businesses to use their wealth to, well, buy even more wealth.

The secretive Koch Brothers are said to have a net worth of $21.5 billion each and are particularly influential. They financed the Tea Party movement and along with big corporations and other billionaires they financed the massive assault of TV ads in the midterm elections that helped change the makeup of the Congress. And now Congress is paying them back,

Nine of the 12 new Republicans on the panel signed a pledge distributed by a Koch-founded advocacy group — Americans for Prosperity — to oppose the Obama administration’s proposal to regulate greenhouse gases. Of the six GOP freshman lawmakers on the panel, five benefited from the group’s separate advertising and grassroots activity during the 2010 campaign. … Republicans on the committee have launched an agenda of the sort long backed by the Koch brothers. A top early goal: restricting the reach of the Environmental Protection Agency, which oversees the Kochs’ core energy businesses.
We Must Address This

We owe it to ourselves to come to grips with this problem. We owe it to democracy to begin taxing high incomes and inheritance again. We owe it to future generations to use a temporary wealth tax to pay off the debt.

Resources

The Working Group on Extreme Inequality explains why inequality matters in many more ways, and is well worth clicking through to study. They also have a page of resources for study with links to other organizations. Also, spend some time at Too Much, A commentary on excess and inequality because it is “Dedicated to the notion that our world would be considerably more caring, prosperous, and democratic if we narrowed the vast gap that divides our wealthy from everyone else.” The Center on Budget and Policy Priorities has a Poverty and Income area of research with good resources. The Center for Economic and Policy Research has a research section on Inequality and Poverty.

About Dave Johnson

Dave has more than 20 years of technology industry experience including positions as CEO and VP of marketing. His earlier career included technical positions, including video game design at Atari and Imagic. And he was a pioneer in design and development of productivity and educational applications of personal computers. More recently he helped co-found a company developing desktop systems to validate carbon trading in the US.

SOURCE: http://blog.ourfuture.org/20120322/Nine_Pictures_Of_The_Extreme_IncomeWealth_Gap