Economics – Miscellaneous – Page 4 – education and deconstruction.com

The Professor and the President – BONUS POST

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The Bonus Book of the Week is “The Professor and the President, Daniel Patrick Moynihan in the Nixon White House” by Stephen Hess, published in 2015.

“We cannot learn from one another until we stop shouting at one another– until we speak quietly enough so that our words can be heard as well as our voices.”

The above was uttered by president Richard Nixon in a speech. Although he was best known for committing political crimes and war crimes and then attempting to hush them up– socially good pieces of legislation signed by him (pro-environmental and against sex discrimination), were actually passed during his presidency (!) This slim volume discussed how Moynihan’s unlikely relationship with Nixon played a role in eventually establishing Supplemental Security Income. Read the book to learn the details.

Free – BONUS POST

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The Bonus Book of the Week is “Free: A Child and A Country at the End of History” by Lea Ypi, published in 2021.

According to the book (which appears to be credible although it lacks Notes, Sources, References, or Bibliography and an index), Albania’s monarchist government and business leaders threw in with their Italian invaders in 1939. In 1944, the Italians retreated and Albania’s occupation by the Soviets resulted in one-Party rule. The practice of organized, monotheistic religions was banned, but Albanians worshiped a real person– a founding-father and WWII military hero named “Uncle Enver.” He severed Albania’s diplomatic relations with Yugoslavia after the war.

The Albanian author, born in September 1979, was indoctrinated to believe that her country was one of the freest on earth. Never mind that the common people had to stand in line for hours and hours daily or sometimes longer (they were allowed placeholders) to obtain such basic necessities as milk, cheese, kerosene, etc. through a voucher system. In addition, her childhood was fraught with lies about her great-grandfather and others in her family’s social circles.

Ironically, just as pedigree among the wealthy in the United States denotes social status, so the “biography” among ordinary Albanians determined whether one would be allowed to join the socialist (political) Party, and determined one’s reputation, and thus one’s work and social activities in daily life. It was guilt by association; one was guilty just by having politically unpopular ancestors, as had the author. Albanians were required, however, to attend meetings at their local civic associations.

In December 1990, there occurred a major political turning point in Albania’s history: free and fair multi-party elections; a turning point in its economics too, as its government heeded bad financial advice it received from Western powers, that invited corruption similar to that of Bolivia’s (See this blog’s post, “Jeffrey Sachs”). In the early 1990’s, for the first time (!), the author found out about or experienced: air conditioning, bananas, traffic lights, jeans, chewing gum, Mickey Mouse, AIDS, anorexia and plenty of other cultural givens the democratic peoples of the world took for granted.

Read the book to learn of the trials and tribulations specific to Albania’s people when they saw how the other half lived (hint: World Bank meddling, a civil war, education shenanigans and more).

An Ambassador in Paris

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The Book of the Week is “An Ambassador in Paris, The Reagan Years” by Evan Galbraith, published in 1987. The author was unrelated to John Kenneth Galbraith. This personal account described the job of an ambassador who represented the United States, stationed in a UN-member, industrialized country– France. He revealed the ignorance, misconceptions and prejudices even political insiders can have– his own (probably without meaning to.)

The author began his four-year stint in November 1987. He had been a lawyer and banker for 25 years prior. He possessed extensive international business experience and had lived in Paris and London for years and years. But– communication skills, tact, foreign-language fluency and knowledge of other cultures turned out to be almost useless anyway, because the ambassador had so little power. The job requires a social-butterfly personality– attending official lunches, dinners, receptions and cocktail parties several times a week, and then generating reports on gossip and interesting factoids. He wrote that knowledge of economics was helpful for the job, yet his writing reflected embarrassing lack of it.

At that time, the author spent hours and hours reading an overwhelming number of daily cables sent to him, consisting of reports generated by embassy personnel, of communications between foreign countries and the U.S. government (which the French were allowed to see), and the CIA’s (alleged “top secret”) interactions.

In spring 1986, the author lunched with French leader Jacques Chirac. They both truly believed that president Ronald Reagan’s pet project “Star Wars” (involving extremely expensive but state-of-the-art weapons launched from outer space) was actually going to be completed and implemented (!) If the Soviets attacked with their missiles, it would be in the best interests of the U.S. to defend Europe with its high-tech weaponry.

Anyway, also in the 1980’s, about two thirds of France’s energy needs were met by nuclear power plants. It was predicted that by the 1990’s, that proportion would be nine tenths. The French believed that a nuclear arms race served as a deterrent to Soviet aggression. It might be recalled the French often conducted nuclear tests, to the consternation of many.

France’s government was a patchwork of political parties. In the early 1980’s, the Socialist party held the majority of power but there were too few voters who would elect the Socialists unless they allied with Communist representatives. So they did.

The author thought that multi-country summits were a waste of time. He suggested that two world leaders meet without a formal agenda, for one day. He rocked the boat when he complained that American officials were visiting the French embassy too often just for fun (or– for those who planning on running for higher office– to be able to say they acquired foreign policy experience). Because they were wined, dined and perhaps received luxury accommodations, they were wasting American taxpayer dollars.

Read the book to learn a lot more about the author’s cluelessness on the fact that the Soviet Union was on the way out, about France’s foreign and security policies, French history, and U.S. foreign policy.

How I Cracked the Alpha Code – BONUS POST

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“The new guys were preoccupied with being reelected, the demands of which were not well served by ridiculous fantasies like fiscal discipline.”

American politics? Rogers was actually referring to the money managers of the euro in the early 2000’s. He was cautiously optimistic about the euro when it was first launched. Oh, well.

The Bonus Book of the Week is “How I Cracked the Alpha Code” by Jim Rogers, published in 2013. This was a partially autobiographical, extended essay that gave tips on how to gauge economic prosperity and prospects in different places. At all times, Rogers is on the lookout everywhere for investment opportunities. He made his (take this job and shove it) money and retired from investment banking at 37 years old.

Born in 1942, Rogers and his wife and young children tried living in Shanghai and Hong Kong (where there was horrible air pollution) beginning in 2005, before deciding to move to Singapore from New York City.

Singapore requires no security at public events, so it is safe for children. He claimed that the education and healthcare systems are excellent. It has entitlement programs in those areas and in home ownership that are roughly equivalent to health savings accounts and 529 plans in the U.S. with contribution-matching through employers, but administered by the government. The public schools require parents to volunteer to help in various capacities. Medical treatment is a great value compared to that in the U.S. No surprise there. It also has the equivalent of America’s E-ZPass system on toll roads and for parking, too.

However, Rogers merely listed the positive aspects of Singaporeans’ lifestyle. He listed no negatives, except for potential, general economic threats that could affect any nation. Another glaring omission of inconvenient information was cryptocurrencies. But he did reveal his basic philosophy: one’s real worth is what one would be worth if one lost all of his or her money. And let financial entities fail so as to encourage creative destruction. Do not bail them out.

Rogers listed some of the kinds of policies and practices that bring a country down economically: wars, litigation, and incompetent leadership. This blogger would add one more: excessive deregulation. He gave tips on what a nation should do to try to reverse its serious financial position: reform the tax system so as to encourage savings and investment, not consumption; “change the education system” and reform healthcare and litigation.

Read the book to learn more cherry-picked information that bolstered the author’s too brief, too pat pronouncements.

Exorbitant Privilege

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The Book of the Week is “Exorbitant Privilege, The Rise and Fall of the Dollar and the Future of the International Monetary System” by Barry Eichengreen, published in 2011.

“Often these individuals had little professional training, there being no meaningful federal or in some cases, even state licensing requirements.”

No, the above refers to neither tax preparers nor life coaches.

The author was referring to the bandwagon-jumpers who worked for lenders taking advantage of the excessive deregulation that resulted in the 2008 subprime mortgage crisis in America.

The author listed some factors favoring, and some disfavoring the American dollar’s ability to maintain its global power as a currency and store of value. However, one major factor the author completely neglected to mention (a glaring omission) was that of cryptocurrencies.

Anyway, Brooksley Born, head of the Commodities Futures Trading Commission, raised the alarm in the late 1990’s on the excessive deregulation that was to lead to the subprime crisis. She deserves more of a historical footnote than she has since received, because sadly, greedy alpha males are better propagandists than prescient, conscientious public-officials such as she.

The author contended that one major reason the American dollar will continue to maintain its dominance in the world, is that other industrialized nations can’t agree on what financial instrument should replace the American dollar as a stabilizer of the world’s other currencies. The greenback has compiled a longer history of trustworthiness, value-consistency, related liquidity-maintenance, and other benefits, in connection with transactions and international trade balances, more than any other instrument. China’s policy of keeping its central banks’ foreign-reserves balance a secret, reduces China’s currency’s trustworthiness.

The powerful U.S. government backs up its currency through treasury bonds and bills, while a (sometimes contentious) collective of European countries (not one government) must agree on how to act when a monetary crisis rears its ugly head. It stands to reason that disagreement or indecision leads to uncertainty, which leads to instability, and a possible worsening or hastening of, the collapse of modern civilization.

The aforementioned are just a few reasons why 54 countries pegged their currency’s values to the American dollar, while 27 pegged theirs to the euro, as of 2009. As is well known, the George W. Bush administration did a number on the U.S. economy, as “… tax cuts and unfunded spending increases [on two extremely expensive wars and a Medicare drug benefit] pushed the budget from surplus in 2000 to a structural deficit of 4 percent of GDP in 2007-2008.” The next two years saw the American government’s debt explosion at its worst.

The author outlined several possible (yet raucously controversial) ways to keep the American dollar globally powerful, through cost-cutting:

In a period of non-war– less defense-spending;

Reforming healthcare;

Raising the retirement age– less pension spending;

Liberalizing immigration policy — helps fund Social Security going forward; and

Increasing taxes of all kinds.

Read the book to learn a lot more about how the American dollar has fallen in stature in recent decades, and about other geopolitical international: monetary, financial and economic issues; explained for laypeople.

Boomerang

The Book of the Week is “Boomerang, Travels in the New Third World” by Michael Lewis, published in 2011. As the effects of the early 2000’s financial shenanigans began to be felt around the world, the author traveled to newly impoverished countries (Iceland, Greece, Ireland, Germany and the United States) to try to understand their situations, economically, politically and culturally. Human nature is such that very few people see the big picture before it’s too late. Besides that, it takes a long time for the victims to learn who really instigated and funded insidious propaganda campaigns or nefarious activities, if they ever do learn.

Kyle Bass, investment banker from Dallas, raised the alarm prior to the 2008 subprime mortgage crisis, but was shouted down by greedy alpha males with hubris syndrome. So he bet against the sheep and made a killing. But he believed the lowest-risk alternative to the securities market was physical gold, and nickels.

Iceland saw the U.S. in the 1980’s enjoying its material wealth, and wanted a piece of that. Iceland’s prime minister David Oddsson ushered in tax cuts and privatization, and greased the wheels of trade. In this way, the government was enticed into the vortex of excessive-deregulation-induced capitalistic greed. Around 2000, fishing industry regulations produced a maximally efficient, maximally profitable oligopoly that prompted Icelanders who weren’t in the fishing industry, to engage in aluminum smelting, and other economically rewarding careers.

The internet has facilitated the forming of relationships between hegemonic financial entities and overseas suckers. Beginning in 2003, young adults in Iceland found that speculative trading in stocks and currency was much more lucrative than fishing.

Ironically, Iceland– whose economy was based on fishing– was ready to take the bait, and become the fish. The former fishermen thought they’d succeed in the financial-services industry because fishing and money-management both involve risk-taking. However, the former requires specific physical and survival skills; the latter, knowledge and experience in the securities markets, business, economics and politics. Icelanders had none of the latter.

Unsurprisingly, when the money started rolling in, the newly rich started to buy houses and cars they couldn’t afford. Human nature is also such that, when people move numbers around on a screen, they don’t feel like they’re moving real money. The bankers and traders in Iceland were borrowing tens of billions from foreigners in the short term, “…then re-lending the money to themselves and their friends to…” overpay for a large financial stake in other banks, sports teams, and other assets. Astute sellers saw the writing on the wall, and left Iceland holding the bag.

European regulators were asleep at the switch. If U.S. financial institutions had been the targets, or had been engaging in such activity, there would have been more early awareness and safeguards in place, in fending off hostile takeovers.

The Americans have their lawyers, directors and officers, and consultants as the first line of defense. Their financial institutions didn’t play the fool the same way major banks in Iceland did. They were largely the lenders and sellers, not the borrowers. But they still got in trouble (!), and also needed adult supervision going forward to bail themselves out.

Incidentally, the SPAC affiliated with former U.S. president Donald Trump needs to continue to find foreign entities (like those that Iceland’s became) with whom he shares the same ethics (or lack thereof), to establish his new media empire. Here’s a little ditty about the situation thus far:

FUN, FUN, FUN

sung to the tune of “Fun, Fun, Fun” with apologies to the Beach Boys.

Well, he’s got his base’s-money
and he’s cruising to his next train WRECK now.

Seems like he forgot all-about
the REAsons he was banned from Big TECH now.

And with the hate-speech blasting
with over-whelming noise full of DRECK now.

And he’ll have fun, fun, fun
till the hackers take his network away.

(Fun, fun, fun till the hackers take his network away.)

Well, the Dems can’t stand him
’cause he’s STILL hogging media space now.

(He’s still hogging space now, he’s still hogging space.)

He gives American politics
a persistent Nix-onian face now.

(He’s still hogging space now, he’s still hogging space.)

A lotta critics try to nail him
but he spins a propaganda chase now.

(He’s still hogging space now, he’s still hogging space.)

And he’ll have fun, fun, fun
till the hackers take his network away.

(Fun, fun, fun till the hackers take his network away.)

Well, he knew all along
that his foes were getting wise to HIM now.

(He needs a new crew now, he needs a new crew.)

And since his stunts are getting old,
they’ve been wishing that his fun is all through now.

(He needs a new crew now, he needs a new crew.)

And things are coming to a head
and his lawyers got a lot to do now.

(He needs a new crew now, he needs a new crew.)

And he’ll have fun, fun, fun
till the hackers take his network away.

(Fun, fun, fun till the hackers take his network away.)

And he’ll have fun, fun, fun
till the hackers take his network away.

(Fun, fun, fun till the hackers take his network away.)

wo wo wo wo woo woo

(Fun, fun, fun till the hackers take his network away.)
(Fun, fun, fun till the hackers take his network away.)
(Fun, fun, fun till the hackers take his network away.)
(Fun, fun, fun till the hackers take his network away.)
(Fun, fun, fun till the hackers take his network away.)
(Fun, fun, fun till the hackers take his network away.)

Anyway, in October 2008, the party was over for Iceland. Lots of fire insurance was bought, and lots of Range Rovers were set on fire. Finally, in February 2009, the aforementioned Oddsson was ousted as head of the central bank.

The story in Greece was that the government was corrupt, overpaid and overstaffed. No tax collection took place because 2009 was an election year. Corporate employees only (not the self-employed) were the only workers who paid income taxes. All three hundred Parliament members evaded real-property taxes through dishonesty. Cash transactions with no paper trail facilitated the evasion of sales taxes throughout the country. There was wilful ignorance (unbelievably sloppy accounting) that masked just how serious the financial crisis was.

Read the book to learn much more about other aspects of the crisis– the alarm-raisers in Iceland, Ireland and the United States, the one protestor in Ireland, the German mentality, and the responses of a few local American politicians.

The Last Idealist

WARNING: This is a long post.

“They watched him bang away at Berkeley and other campuses, a man nearing eighty-one commanding the attention of student crowds usually scornful of anyone over thirty.”

NOT Bernie Sanders. Norman Thomas.

The Book of the Week is “Norman Thomas, The Last Idealist” by W.A. Swanberg, published in 1976.

Born in November 1884 in Marion, Ohio, Thomas began attending divinity school in 1908, pursuant to his parents’ wish for him to become a Presbyterian reverend, like his father. He espoused the political ideology of a socialist, believing that antisocial behavior could be eliminated if people the world over were provided with a decent standard of living, as there would be no class resentment.

However, Thomas’ marriage to an heiress allowed him to live better than those he aided financially. Initially, the couple lived on an ethnically mixed, high-crime block in East Harlem, among Irish, Jews, Italians and Hungarians. He ministered to parishioners and established social programs at various churches.

Thomas was a charismatic public speaker and a pacifist, keeping busy “eight days a week” with all kinds of political, social and religious groups. He rubbed shoulders with the political influencers of the day, including president Woodrow Wilson. During WWI, he asked the president to refrain from conscripting conscientious objectors– both the devout and those who held sketchy religious beliefs like atheists (and agnostics like himself).

Thomas got in trouble and was forced to resign from his various groups for pacifist speechifying and distribution of pacifist publications (which were censored)– a clear and present danger once America entered WWI. Conscientious objectors and pacifists like himself were getting arrested and jailed. He railed that all Americans had a right to free speech (and later helped found the ACLU); hypocritically, the country was fighting the war in order to combat the fascist Prussians.

Although in 1917 Thomas endorsed the Socialist Party candidate Morris Hillquit for mayor of New York City, Thomas actually delayed joining the Party until the end of the war. Hillquit thought Thomas could be instrumental in getting more Gentiles to join, as the New York City chapter was overwhelmingly Jewish.

Both the Socialist and Communist parties ran candidates for mayor even though they knew they would lose. Each hoped to convert the members of the other’s Party to join their own. The socialists’ enemies smeared them all as Bolshevists (though only a few were on the far left fringe), as the Russian Revolution heated up.

In the 1920’s, the ruling class committed a lot of violence against the working class when there occurred labor unrest. The Palmer raids resulted in beatings, arrests and jailings. The government reasoned that violence was a necessary (temporary!) evil in restoring democracy. That was the same thinking of the Communists in America who felt the Soviets were creating the right kind of political system, but that the oppression would eventually cease.

Thomas wisely stayed Socialist through the decades, as he saw that Communists were totalitarian. Nevertheless, he was conflicted, as he took heart in the fact that the Russians fought against Fascism: by aiding the Loyalists in Spain during its civil war, and during WWII. Some American Communists were thrown for a loop after Stalin made a pact with Hitler in 1939; others, when Khrushchev revealed Stalin’s human rights abuses and atrocities in 1956.

In 1920, New York State Assembly speaker Thaddeus Sweet, a Republican, took the undemocratic action of suspending five New York State Assembly members just for being in the Socialist Party. Their constituents included sixty thousand voters in New York City. The Assembly voted 145-2 to expel them altogether. They were accused of seeking to break up traditional families, being anti-religious, and opposing capitalism.

In 1933, membership in the Socialist Party reached its peak, numbering about nineteen thousand. But those who had been spellbound by the shrewd, entertaining Thomas, began to back FDR instead; the latter began to offer similar social programs and was already president. Many voters thought the evils of capitalism had caused the Great Depression. Others turned to hatred spouted by rabble rousers like Father Coughlin, Hitler and Mussolini.

In the 1930’s, there were heated discussions, debates and decisions that never pleased everyone, between and among all the different factions (Communists, Trotskyites, Old Guard, Militant-Centrist, etc.) in election years and at political conventions. Up until 1936, they used various communications outlets to spread their gospel: the Rand School, the Jewish Daily Forward, a radio station, publications like the New Leader, and a summer camp.

In 1940, the American Labor Party favored FDR, who supported capitalism and war. Thomas acted as a spoiler, as he was still an anti-capitalist and pacifist. He bristled at Britain’s colonialism in India. Jews in New York City felt the need to fight Hitler, so their allegiance lay with FDR, especially after December 1941.

Arguably, Thomas engaged in hypocrisy in his choosing to ally with the Nazi-friendly Charles Lindbergh, but only because the latter wanted America to stay out of the war. Lindbergh, and Joseph P. Kennedy were the kinds of individuals who attached themselves to Hitler because they thought Germany would win the war. That way, in the end, they’d be on the winning side. They would get the spoils. Fortunately, on WWII, they guessed wrong.

Fast forward to spring 1960. After the U-2 incident, Thomas wrote, “… in the widely played game of peacetime espionage, we lie and cheat like the rest of them– only better, we now boast, because of our technical skill. In the anarchy of sovereign nations there are no morals, there is no crime, except to be caught.”

In summer 1963, Thomas, a Princeton University graduate, got his article published in the alumni magazine. He expressed his dismay that the school received a bit more than half (!) of its total budget from federal grants. He wanted to know what proportion of those were made on behalf of the Pentagon. No word on whether anyone answered him. Later, Thomas was bothered that the younger generation was rooting for the NLF and the Vietcong rather than trying to lobby LBJ to stop the Vietnam War. He advised them to wash, instead of burn, the American flag.

In the mid to late 1960’s, Thomas was able to push his causes because his articles were printed in the national, high-circulation Life and Playboy and Esquire magazines; he also did TV interviews with highly rated shows. Unfortunately, publicity is only a small ingredient that is part of the planning process in getting people to adopt causes. Thomas, even with all his popularity, lacked the other ingredients on and off during the entire course of his career: funding and executing (actually getting elected to office).

Read the book to learn of the numerous elective offices for which Thomas ran as a Socialist and his adventures in connection therewith globally: speaking, publishing and socializing with diplomats; of the details of decades-long Socialist Party infighting; the shocking revelation that came to light about the CIA in 1967; and much, much more.

ENDNOTE: This blogger would like to clarify once and for all, what characterizes a few different economic and political systems.

First:

With SOCIALISM, the people collectively own entities, and share and share alike. These can be profit-seeking businesses. The government can own entities that provide essential services, that should not be profit-seeking (but some of their subcontractors are, anyway), such as libraries, welfare, healthcare, early childhood education, infrastructure, and social programs.

With COMMUNISM, the government owns profit-seeking entities (businesses) in whole or in part (as in the former Soviet Union and China). So yes, these include public-private partnerships in which there are clearly outrageous conflicts of interest that result in patronage and profiteering. So, arguably, the former Soviet Union and China have both Socialism and Communism to a large degree.

Also, see a bunch of this blog’s posts: Wikinomics, Here At the New Yorker (beginning with the 9th paragraph), Street Without A Name, Against the Grain, Crossing the River, and Patriot Number One. Lastly, see a bunch of excerpts from this blog’s posts:

Klima got a job with a construction crew [in Czechoslovakia in the 1950’s], where he got his first taste of socialism in action. “No one could earn more than was necessary for daily subsistence.” The government was stealing the economic surplus from the people. That was why corruption came into play. He was pressured into joining, surprise, surprise, the Communist Party. He said, “I was stunned by how the environment bubbled over with rancor, continual suspicion, malicious gossip, and personnel screening.”

Fast forward to 2007. Dubai’s small population of about a million citizens (mostly royal family members) allowed the government to adopt a socialist policy of generous entitlements, including an average annual $55,000 in stimulus money, and low-cost or no-cost: cooling of their lavish homes, car-fuel, food, education, healthcare, and water.

In late 1993, mayor Chirac [in Paris, France]– a socialist at heart– agreed to start a (no-charge) ambulance service for the homeless in Paris. By 1995, via the city council, against the wishes of the socialist (federal) government, he provided free medical care to 150,000 homeless people.

In the early 1920’s, “After 2 decades of debate and agitation, the rise and fall of Populist, Progressive and Socialist parties…” and lots of labor unrest, there was general consensus between government and American business “… that the role of government was not to supersede or control the corporation, but to legalize and legitimize it by regulating its excesses.” [As is well known, capitalism flourished until the late 1920’s.]

Because East Germany was a police state with a socialist mentality, the people availed themselves of a free university education. Merkel got hers, as well as a doctorate in nuclear physics. In exchange, she was required to work for the government for a specific period.

They examined democratic, autocratic and socialistic models of leadership. The most mature group was found in the first model. The second spawned a form of Nazism. The third model’s group members displayed resentment of lazy and non-cooperative individuals.

Although Communism preaches godlessness, the supervising Soviet government [in East Germany] allowed some religious activity among the local citizens. Merkel’s family was spied on by the Stasi- the secret police. It was cost-effective and efficient. For, all the socially dangerous elements (potential subversives) were in one place.

For four decades, Czechoslovakians forced to live under Communism had been told everything was great. In January 1990, Havel truthfully told his countrymen that the nation was in an economically, infrastructurally, environmentally and ethically horrible state. The younger generation who had been born into the Soviet mentality– unless they were dissidents– were obedient robots. So converting people to a capitalist, liberated, honest way of thinking was very difficult.

Blakely thought that bringing capitalism to them [Siberian people] would be a good thing. However, they soon developed an insatiable appetite for consumer goods. Once they were made of aware of their severe deprivation by the media and increased their connections with the rest of the world, they became depressed. Previously, they had been happy due to their ignorance of how materially poor they were.

After the Korean War, the Communist Party of North Korea oppressed business owners– who were considered evil capitalists, but praised farmers and peasants– who were considered virtuous; they served the Party. Adults were forced to attend self-criticism meetings every Saturday morning. The meeting leaders punished them by making them stand up against the wall while others stared at them. Around the time she started school, Jang and her mother went to a theater for the first time. They saw a movie written by their fearless leader, Kim il-sung. Of course, it ended happily because the peasants conquered the landlords.

Once in power [in 2000, Communist] Putin actually kick-started the Russian economy by nationalizing oil companies, and taking control of the gas industry and television.

In order for any native (Chinese) to prevail at a journalism career, joining the Communist Party was mandatory. This involved attending Party conferences on some weekends.

Under Vladimir Lenin in 1918 Russia, “The very notion of pleasure from flavorful food was reviled as capitalist degeneracy.” Millions died of starvation under [Communist] Stalin in 1927 when he took over the means of grain production.

It examines the issue of whether Berlusconi practiced Fascism, not necessarily through creating an atmosphere of fear and intimidation, but through monopolistically broadcasting propaganda in the guise of education, to the masses. He combined his business dealings with politics to amass a staggering amount of power, with the usual conflicts of interest that come with the territory.

He [Charles Koch] became a convert to it [Libertarianism] in its most extreme form. It espouses the belief that a purely capitalist society is the best economic system. This means total deregulation, no entitlements such as government-administered retirement or medical plans, no unions, no socialism of any kind, no income tax, and a government whose role is only to protect citizens and property from each other and outsiders, and from fraud. As a result of their political mentality, Charles and David could have cared less about the environmental destruction and wrongful deaths their company caused due to poorly maintained oil and gas pipelines. Perhaps to salve his conscience, David made huge donations to cultural institutions, especially in New York City. The liberals (hypocritically) gratefully accepted the money, notwithstanding David’s political activities that led to rack and ruin.

In the early 1990’s, [Soviet] leader Boris Yeltsin became a convert of [Jeffrey] Sachs. The result was mass corruption. On the other hand, this has helped the United States and other nations with already evolved [mostly] capitalist systems to maintain their economic dominance in the world. This blogger is not saying such a goal is right or wrong, but merely suggesting that this might have been Sachs’ goal.

***

The Death of Money / Dealings – BONUS POST

The first Bonus Book of the Week is “The Death of Money, The Coming Collapse of the International Monetary System” by James Rickards, published in 2014. This was an all-over-the-map hodgepodge of generalizations on global financial trends, economic theory and what the author claimed was the devastation those trends could lead to, as of the book’s writing.

Prior to 9/11, the CIA possessed no expertise in the nefarious goings-on in the securities industry that could presage the occurrence of a terrorist attack. America’s law enforcement and security agencies had plenty of data, but inter-agency rivalry inhibited information-sharing and creativity– that would have allowed them to “connect the dots” in getting more specific information.

Prior to 9/11, American intelligence did detect irregular trading patterns in the stocks of the two airlines whose planes were targeted in the attacks. A tiny percentage of those trades were illegal because they were made by insiders– by the terrorists who knew those airlines’ share prices would soon plummet; the remaining percentage of anomalous trading was done by those who noticed the unusual activity (but not the reason for it) and jumped on the bandwagon.

After the attacks, threat-detection software was created for monitoring not just stock trading, but also currency and precious metals trading. The author wrote that a recently trendy means for bringing down an enemy-nation is: doing serious economic and financial harm rather than physical harm. Assaults on a nation’s technology and infrastructure such as the money-handling parts of cyberspace, aviation, dams and utilities, instead of targeting a country’s military and weapons or people of a specific ethnic group, is becoming the new normal.

The author remarked that China’s institutions are actually at risk for attacks, because the country’s government, economically, owns a large chunk of the means of production and arguably, labor; not to mention, capital. Wealthy Chinese business owners and executives have a co-dependent relationship with (corrupt) government officials. Besides, there are: “cross ownership, family ties, front companies, and straw man stockholders.”

The author warned the reader that a global financial crisis is likely in the offing due to prevailing circumstances in the economic heavy hitters of the world (like, the United States and China); among those circumstances: misallocation of investment funds; employers’ power to minimize benefits and compensation; red ink and the ever-widening, (allegedly alarming) gap between rich and poor. Financial panic is correlated with social unrest. That can lead to revolution.

The magnitude and accelerating frequency of financial bailouts of the last twenty-five years just shows how fragile the economic systems of the world are. In the United States, excessive deregulation fueled out-of-control greed, etc., etc., etc. In Europe, the group of nations that agreed to adopt one currency (the euro) thought the other nations would help mitigate their own economic problems, when in reality– they were putting all their eggs in one basket. In effect, they had to get permission from the others to make significant changes to their economic policies; they were forced into unhealthy co-dependent relationships.

Read the book to get the lowdown on: all the different groups of nations which were trying to diminish the U.S. dollar’s hegemony (hint: BRICS, BELL, GIIPS, SCO, GCC) at the book’s writing; the United States’ economic system explained for laypeople (via a Venn diagram, along with how the author defined “money” and “death”– both buried in the middle of the book); and everything you ever wanted to know about the value of gold, among other factors in the American dollar’s declining power in the world.

The second Bonus Book of the Week is “Dealings, A Political and Financial Life” by Felix Rohatyn, published in 2010. This bragfest described the life of the typical alpha male who rode a fabulous career in the securities industry, starting in the 1950’s.

The aforementioned first Bonus Book described the trends indicative of a dire future global financial situation. Many such untoward events have already occurred in the last couple of centuries (!), and keep happening. Every time, the seeds of financial disaster are sown decades prior to when it hits the fan.

The selective memory and cherry-picking of data of participants and victims (not to mention propagandists!) cause readers to perceive that those kinds of events are unprecedented, or are becoming more frequent. Excuse the cliche, THERE IS NOTHING NEW UNDER THE SUN (For more info, see this blog’s posts: Serpent on the Rock, A Fighting Chance, Since Yesterday, Why I Left Goldman Sachs, The Zeroes and Dot Bomb).

Rohatyn described a few major stressful economic near-disasters that he was asked to help remedy. One situation was early 1970’s Wall Street, which was a house of cards about to collapse. Another was the near-bankruptcy of New York City in the mid-1970’s.

The late 1950’s saw the city becoming a bloated, bureaucratic civil-service gravy train, due to the increasing power of unions. The costs of generous contracts (along with other sociological factors) was eroding the city’s tax base. Local politicians stayed in power by staying friendly with the unions. One hand washed the other.

At the dawn of the 1970’s, the city needed more and more short-term loans from banks. Creative accounting allowed the debt explosion to continue. The city got subsidies from the state and federal governments, but only at the end of its fiscal year, so its deficit ballooned annually before then. The city got generous borrowing terms because it was in the state’s and fed’s best interest (excuse the pun) to deregulate the lending banks, as they were political patrons, too. Eventually, push came to shove.

In June 1975, Rohatyn was appointed to a bipartisan (truly bipartisan!) committee to help New York State governor Hugh Carey draft a bailout plan for the city, three weeks before the date on which the city would be forced into bankruptcy. Fortunately, Carey possessed the right temperament for saving the world.

Read the book to learn more about how the author helped impose some adult supervision in various, serious economic episodes in his career, and more about his career itself.

The Most Dangerous Man In Detroit

The Book of the Week is “The Most Dangerous Man in Detroit, Walter Reuther and the Fate of American Labor” by Nelson Lichtenstein, published in 1995.

Born in September 1907 in West Virginia, Walter Reuther was of German ancestry, raised Lutheran. He quit high school to learn the tool and die trade. In February 1927, he and a friend moved to Detroit for better pay and hours. He eventually made his way to Ford Motor Company, where he quickly rose through the ranks before the Great Depression hit America.

In the early 1930’s, Ford opened a plant to manufacture its Model “A” in the Soviet Union. Americans who believed in socialism were aware that the Stalin-led Soviet government ruled via one party– the Communist, and was perpetrating human rights abuses. But they liked certain economic aspects of its experimental “Five Year Plan.”

Beginning in early 1933, Walter and his brother Victor bicycled a distance of approximately twelve thousand kilometers during the nine months they were meeting with their European political contacts in various countries. In spring 1933, they were already seeing Fascist oppression in major German cities. In late 1933, they began working in a few Soviet industrial complexes to see labor and political conditions for themselves.

By the late 1930’s, the famine caused by Stalin’s disastrous agricultural-reform program prompted peasant-farmers to go to work in the factories that made steel, cars and tractors. In mid-1934, since they were foreigners and skilled middle-managers (training workers in tool and die making), Walter and Victor were permitted to travel between Stalingrad and Moscow to visit construction projects, collective farms and tractor factories. They were chaperoned by Party bureaucrats. They got special treatment, so perhaps they did not see the abuses suffered by unskilled workers. Their experiences led them to believe that the Soviet system was far less of a police-state than Germany’s.

Walter and Victor wanted to believe so badly in a Soviet workers’ paradise that they rationalized away the serious problems (such as impossible-to-meet production quotas, and reports of fancifully high numbers of vehicles manufactured). In 1934, on supervised tours, the brothers also took a look at labor conditions in China and Japan. October 1935 saw them return to the United States.

On May Day of 1936, in major cities across America, various political groups were speaking in the public square with the goal of unionizing workers; some of them– the Socialists, Proletarian and Communist parties– united to form a Popular Front (the joke in Spain was, “the girl with the Popular Front”).

By the mid-1930’s, the auto industry (which included carmakers, parts suppliers, tool and die makers, etc.) consisted of about a half million union members, thirty thousand of whom were in the United Auto Workers (UAW), a national union. In autumn 1936, Walter became a member of that union’s executive board. He planned and got employees to execute work-stoppages and sit-down strikes in order to get the big automakers like GM, Ford, Chrysler and Dodge to grant collective bargaining rights exclusively to the UAW. Other workplaces such as U.S. Steel were inspired to take such actions, too.

Ford was particularly hostile in its anti-union activities, as it had an in-house security department that spied on workers, fired some, and used violence against photographers. GM took measures to protect against productivity losses by rotating its parts suppliers and building new plants in different locations.

In the late 1930’s, Walter launched propaganda campaigns with the distribution of leaflets, and ran pro-union candidates in local political elections in Midwestern cities. In October 1945, he knew that his UAW workers couldn’t win their strike on just solidarity and militancy. He needed support from other ordinary Americans and the federal government. In January 1946, union workers in a bunch of other industries struck, too; electrical, meatpacking, steel milling, and iron mining.

By the late 1940’s, the power of the unions and corruption in government skyrocketed, so that organized crime used bribery, patronage-contracts and and physical violence in order to rule the “… construction industry, short haul trucking, East Coast longshoring , and the bakery and restaurant trades.”

It is a little-publicized datum that in 1962, president Kennedy granted a cut to all taxpayers that favored corporate America, which also got tax breaks. The rich got richer. That same year, members of the UAW executive board included 21 Caucasians, and one African American, whom they knew wouldn’t buck the status quo.

By then, Walter, a liberal, realized he had been incorrect in thinking that the American labor movement would eliminate discrimination in the workplace when the unions and the economy were strong. But he was still stubborn in insisting on an all-or-nothing egalitarianism. Others of his political ilk, such as Eleanor Roosevelt, Hubert Humphrey and Adlai Stevenson were willing to compromise with the Dixiecrats (Southern Democrats who opposed civil-rights legislation) to make a little progress rather than none. The following year, Walter had become more flexible, as he was friendly with JFK and his brother.

In July 1967, the race riots in Detroit resulted in the deaths of 43 people and $250 million in property damage. The mayor, and the governor of Michigan assigned a 39-member panel of leaders and influencers in the community to suggest solutions for quelling hostilities. Various actions were taken; among the major ones:

throwing money at low-cost housing;

hiring of black workers at Ford and GM; and

throwing money at black community groups

but nothing seemed to help. The automakers moved their plants from Detroit to Troy and Dearborn.

Read the book to learn a wealth of additional information on Walter’s trials, tribulations, triumphs, and disputes with the AFL and CIO (unions competing against, and with different views from, the UAW); the growing-pains of the labor movement– how it was affected by: the WWII years (hint– the government ordered it to make war weaponry), political elections, regulation of pricing / wages / production in the steel industry, the Civil Rights movement, the Vietnam War; how and why different automakers’ compensation structures changed, and much more. See this blog’s post “See You In Court” for more information on the pros and cons of unions in America.

A Fighting Chance – BONUS POST

The death toll is rising among all kinds of Americans in connection with illegally acquired firearms. See ENDNOTE at the bottom of this post.

And now, a non sequitur: The Bonus Book of the Week is “A Fighting Chance” by Elizabeth Warren, published in 2014.

Born in 1949, Warren spent her childhood in Oklahoma, but later lived in Texas, and various cities on the Eastern Seaboard.

In a rare achievement for a female of her generation, she earned a law degree. With her daughter, she wrote a book about how Americans’ spending habits changed between 1971 and 2001. After meticulous research and numerical analyses, the authors explained why Americans are actually getting poorer with every generation. The answer is that even with accounting for inflation– wages haven’t risen in value; and housing, healthcare and education costs have soared.

Warren was appointed to a task force that investigated the big-bank bailout of 2008. She thought of the task force’s mission as bipartisan, but early on, Congressman Jeb Hensarling (R.-TX), had an us-versus-them mentality and wanted to make sure the Republicans on the task force got the same resources that the Democrats did in their investigation.

The task force hired expert auditors to check and re-check whether taxpayers got their money’s worth, since taxpayers were the ones fronting the money. But for the task forces’ calling the financial institutions’ bluff on their claims, taxpayers would have been financially punished even worse.

Warren wrote that it was fortunate that in 2011 the media helped publicize the lies of the big financial institutions (the credit unions and community banks weren’t to blame) in the mortgage and foreclosure scandals– because regulators were, out of willful ignorance or incompetence, not doing their jobs.

Warren recounted her stressful experiences running for a U.S. Senate seat in Massachusetts in the 2012 election. Here is a parody that sums it up:

ELECTION BLUES

sung to the tune of “Electric Blue” with apologies to Icehouse.

If I had a chance

to run for office like you,

are you gonna hate from the start,

smear and lie with your crew?

Are you spying somewhere behind my lines?
I just cringe with every wrong that you do me.
You get away with it, too.
Election blues.

No privacy. I need to raise money.

Tell me what can I do?

Election blues.

Oh, you dealt me a low blow.

Voters believed it was true.

Oh, I would give anything just to defeat you.

Are you spying somewhere behind my lines?
I just cringe with every wrong that you do me.
You get away with it, too.
Election blues.

At great expense,

traveling all over as I’m briefed on issues.

Election blues.

I can sense, sense that the media

are plugging for you.

Election blues.

I’m so tense, I need to get votes.

Tell me, what can I do?

Election blues.

ENDNOTE: Warren told an anecdote in which she met with a religious minister to pray for victims of gun violence (after the fact!), instead of suggesting a way to prevent it. Her areas of expertise are obviously law, economics and finance, but it appeared that she was told not to talk about “gun control” because her mouth had gotten her in trouble on another issue earlier in her campaign.

It seems America’s current leaders think GUN CONTROL is a dirty phrase, pandora’s box, not worth fighting for, or for some, it is too lucrative to even mention.

As is well known, Third World countries (!) have black markets in firearms. The United States likes to think it is more civilized than them. But in recent decades, that point has become more debatable.

In the second half of the 1970’s, the nation suffered both psychological and physical “malaise” of various kinds. Forty years or so ago, even though there was no political lockdown imposed to try to stop the spread of severe flu– there was intense political pressure put on president Gerald Ford to do something. So a swine flu vaccine was developed in 1976. There were also two (!) assassination attempts via firearms on president Ford.

Then, in March 1981, president Ronald Reagan was shot by someone who had acquired a gun illegally. Fortunately, he survived to turn the country around psychologically. No one wants shootings to ever happen again. But the ones involving illegally acquired guns are a reasonably preventable occurrence!

Further, Americans’ First-Amendment right to peaceably assemble has been severely restricted as an alleged COVID prevention measure. It is also obvious that keeping large numbers of people from gathering in one place, makes deaths from gun violence less likely. The fact that professional athletes, some politicians and VIPs have had their right to assemble restored with no disease-prevention measures, shows that keeping people apart was not actually a disease-prevention measure.

It seems America’s leaders should pass federal legislation on ILLEGAL-gun control, in order to restore the rights of ordinary Americans to peaceably assemble, as assembly is a Constitutional (federal) matter. If they have the courage. One last thing– a question for the ages: After all he’s been through, how can Steve Scalise live with himself?