Protestation.org Blog

The duty of a patriot (Thomas Paine)

January 27th, 2012

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The duty of a patriot is to protect his country from it’s government.

Cuba: Looking Back and Ahead

January 27th, 2012

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From: http://www.counterpunch.org/2012/01/27/cuba-looking-back-and-ahead/

by Saul Landau and Nelson P. Valdes

In 2012, the White House will focus on the most important of international and national issues: the re-election of the President. US-Cuba policy will fall into “Next Year’s” box – or the year after that. The National Security staff reverts to its familiar positions on relations with that troublesome island: ignorance and arrogance.

Few Americans even in the Foreign Service know the Cuban revolution began in the 1860s as a war of independence against Spain.

Spain prevailed in the 1860s war, as did Cuban slavery until 1886. Unlike the 1776 war for independence, the struggle in Cuba confronted a major social issue, which US Founding Fathers had finessed – until Civil War in 1861.

In January 1959, after almost 100 years of on-and-off combat the 26^th of July guerrillas marched into Havana as winners of the decisive round. The revolutionaries carried another ancestral platform: social justice and equality.

Cubans knew well how Washington had acted as their destiny blocker. By 1898, Cuban “independentistas” had almost defeated Spain. The United States intervened to thwart that goal. Washington imposed the Platt Amendment on Cuba’s constitution, giving itself the right to intervene in Cuban affairs, and a naval base in Guantanamo – now a prison and torture chamber. The United States intruded several times in the 20^th Century to alter the island’s fate, including in events following the 1933 overthrow of the Machado dictatorship: to prevent revolutionaries from acquiring sovereignty.

That political-military exercise led to the Fulgencio Batista era (1934-1958) – in which the new US-trained and bonded military held sway.

In 1958, however, Washington lost confidence in Batista’s ability to stop social revolution, and began plotting unsuccessfully with a clique of high military officials to replace Batista with a junta – ala 1934.

The revolutionaries’ victory in 1959 changed Cuba’s destiny. In 1960, after consolidating power, they made “Patria o Muerte” the national slogan, referring to the long-sought goal. 1930s revolutionaries joined the 1950s rebels in a unity program: build a proud, healthy and literate nation, bound by ideals of social justice, equality and sovereignty.

Cubans were offered the chance to become actors on the stage of their own history. Millions left their homes to teach literacy, or joined militias, and voluntary associations to transform the island from dependency and underdevelopment into healthy development.

Cuba’s revolutionary tradition assumed that a sovereign nation would use its resources to benefit its people. Rich soil and industrious workers would provide everyone with a decent living standard. Poverty, most assumed, derived from foreign or domestic exploitation.

Early laws restricting landlords and large foreign and Cuban property owners allowed the government to distribute resources and services to the population, which won more legitimacy for the revolutionaries. But Cuba’s accumulated wealth would prove superficial compared to its needs.

Over the first decades, children of illiterate Cubans earned PhDs, and became doctors and soldiers who volunteered to go abroad to help change destiny in Africa and Latin America. Others volunteered for arduous tasks of construction and agriculture. By the mid 1970s Cuba had become literate and healthy.

To accomplish the overwhelming tasks of development revolutionary leaders had accepted Soviet help. This uneasy, but convenient marriage from 1972-1985 included adopting the Soviet economic and administrative models.

For Cuba the deal meant soft loans, technical assistance, secure supply lines and a high-paying market for its products. While most third world countries transferred capital to developed countries, the Cuba-Soviet agreement reversed the pattern, permitting the island to have sovereignty, social justice and relative equality. Cubans also became world renowned artists, writers and athletes.

For the Soviets Cuba became a legitimizing instrument to maintain credibility among third world peoples, playing a broker-like role for Soviet positions at third world meetings.

On July 26, 1989, however, Fidel Castro warned of the impending demise of the Soviet bloc. Cubans had to prepare. The enemy 90 miles away loomed as a constant threat to the revolution’s goals.

In 1991 the Soviet Union died. Without Soviet aid and trade, could Cuba’s economy survive? The unthinkable alternative, surrender to Washington, led Cuban leaders to design the “special period” — a daily juggling for survival. Euphoria prevailed in Washington. Scholars announced “the end of history,” capitalism had won – well, if one ignored the cyclical disasters. Computers and the Internet would remake the world. China and Vietnam had already abandoned communism — in all but name. Cuba remained the “Jurassic state”.

Without even major trade partners, Cuba’s leaders at first relied on abstractions: national honor, patriotism and shared sacrifice, hardly adequate weapons to fight a 32% GNP drop in one year.

Circumstances dictated that Cuba earn money from foreign tourists, who required a service oriented labor force – including prostitution. Cuba permitted remittances, which created inequality. Working Cubans earned less than non-workers who got rewarded by family members abroad.

Cuba began earning dollars for doctors’ and educators’ services abroad. In turn, this reduced the breadth and quality of education and health care at home.

Living standards fell. Theft, black markets and corruption tied to bureaucracy grew. Those too young to experience the days of subsidized consumption became pessimistic – even cynical – and desperate about their future. Complaining reached theatrical height. As leaders repeated old slogans teenagers passing below signs of Che Guevara reading “Como el Che,” would often say “Si, asmático.” Some opted for rafts to Florida.

Meanwhile, the revolutionaries maintained political power and withstood two decades of counter revolutionary efforts from abroad. By 2001, Cuba’s economy and administrative structures had begun to fall into dysfunction. Corruption levels became intolerable; the once exciting revolutionary script sounded trite.

When Hugo Chavez became President of Venezuela, he provided Cuba with aid and political alliances. Additionally, Latin America accepted Havana as a full partner, ending Cuba’s isolation

Recently, Cuba’s Communist Party reviewed the economy. A new script began to emerge as a series of guidelines (lineamientos). Changes have begun to affect property rights, domestic trade, employment practices, and investments.

In 2012, Cuban leaders could forge a new mission, to remake Cubans as the inspiration – if not saviors – of human life on the planet. Part of Cuba’s population still vibrates with desires to act on the world stage with a script the world’s people need.

Imagine Cuba leading a green revolution for survival! They have the science, experience and organization. Will the leadership pass the torch to those who have the energy and will to carry it out?

Next week: how Fidel Castro laid the groundwork for an environmental mission.

Saul Landau’s WILL THE REAL TERRORIST PLEASE STAND UP plays at Smith College, Feb 16. Counterpunch published his BUSH AND BOTOX WORLD

Nelson Valdés is Professor Emeritus at the University of New Mexico and director of Cuba-L.

A New Chile is Possible

January 27th, 2012

Protestation.org

From: http://www.counterpunch.org/2012/01/27/a-new-chile-is-possible/

by Raúl Zibechi

Chilean students question the education system as commercial and elitist because it reproduces existing social inequities and makes them worse. But they are not just asking questions: They are practicing the kind of education they have spent years dreaming about and struggling to obtain.

“If workers can manage a factory, we can manage the school,” says Cristóbal, 17, as he flashes a smile. Cristóbal is a student at the Luis Galecio Corvera A-90 high school in the Santiago borough of San Miguel. The school is among the 200 in the city that students have occupied. But on September 26, they decided to follow the example of the workers of Cerámicas Zanón, the Argentine factory workers took over and began running 10 years ago.

“Things were getting complicated because the occupation was weakening,” Cristóbal says. “It was clear to us that it wasn’t enough to just criticize our education. We had to do something more, but we didn’t know where to start until we heard that the Zanón workers were giving a talk at the University of Chile. We went to listen to them and when we came back we started running the school ourselves.”

After the takeover, a majority of students—with the enthusiastic support of many parents—returned to school. Some of the teachers joined them. “When I saw that my children were getting up and going to school without having to wake them up, that they were excited about going, I understood that they were doing something important, something that adds up to a different kind of education,” says a mother at the basketball court, where the November sun shines brightly.

Non-teaching workers took refuge in a union resolution that authorizes them to not work without school management. “The unions don’t work if there’s no boss,” Cristóbal noted with irony, prompting bursts of laughter in the courtyard. In just a few months the secondary students have learned more than they did during years of monotonous classes. They take the initiative for their studies, propose topics, show up on time, and are delighted not to wear the government-mandated school uniform they call “penguin suits.”

The student conflict was a tremendous jolt to Chilean society, as reflected even by public opinion polls. When the newspaper La Nacion asked a group of poll takers to name the best thing about 2011, 63 percent answered the student and environment mobilizations, compared with just 17 percent who chose the University of Chile soccer team, which won the South American cup at the end of November. Just 3 percent chose the Cervantes Prize, the major Spanish-language literary prize, which was awarded to writer Nicanor Parra.

Chile’s most prominent intellectuals agreed with the editor of Le Monde Diplomatique, Victor Hugo de la Fuente, who wrote: “In five months of massive mobilizations, Chilean students have changed the face of the country.” “The Manifesto of Historians [a document designed to answer some of the basic questions about the protests and signed by some of the nation's leading intellectuals and academics],” goes even further, and maintains that “we are looking at a revolutionary, anti-neoliberal movement” that is restoring politics to civil society and re-knitting the strands of history which were interrupted by the 1973 coup.

A society in motion

Chile has not seen such a vast wave of protest since the 1980s and the massive mobilizations against the Augusto Pinochet dictatorship. The year began with solid resistance in the south, around the city of Punto Arenas, and protests against increased gas prices. The movement was so strong that the government had to negotiate with the Citizens Assembly of Magallanes and eventually reversed the price hikes.

Then in May more than 30,000 people protested in Santiago against the HidroAysén project to build five mega dams in Patagonia (a project supported by both the government and the opposition) without consulting the public. Never before had an environmental action united so many people, an indication that change was underway.

Soon after, victims of the 2010 earthquake began to demonstrate. Most of them were still homeless, spending their second winter in highly precarious conditions. As they pointed out, highways used to transport goods had been repaired, but not the homes of the poor and working class.

At the end of April, students began to mobilize. On June 30, 200,000 marched along the Alameda, Santiago’s most important thoroughfare. From then on, there were dozens of marches. “Young people were moved by a festive spirit,” according to historian Mario Garcés. There were no political party banners or uniform signs. Above all, there were no marches to familiar state symbols—Congress and the President’s Office, the usual destinations for unions and political parties.

In the following weeks, students, especially high school students, occupied the television network Chilevision to protest coverage of the mobilizations. They also occupied political party headquarters, both the ultra-rightist UDI and the opposition Socialist Party.

The most important moment occurred on August 4th. Police repression was very strong and 874 students were detained. Throughout the country people responded to the students, with cacerolazos [beating pots and pans in protest] and massive, spontaneous demonstrations in the major cities—they even staged a national strike like they did against Pinochet. President Sebastian Piñera’s popularity had fallen to 22 percent by the end of September.

But what happened in the barrios on the night of August 4th is an indication of the true strength of the movement. Camila Silva, a member of Diatriba, a “militant pedagogy” collective, lives in a lower-middle-class barrio called La Florida. “When I went out to the first caceroleo with my compañero, there were 100 people. The next time, young people from the cultural center brought their batteries and an electric guitar, soccer fans came with their Colo Colo banners and there were groups with Mapuche flags, something that you only see when there is a big win in soccer.”

Camila highlights the enthusiasm of the crowd, the way neighbors–especially women–organized spontaneously. “That organization is like a community, and it wakes up your memory. People shouting, ‘And he’s going to fall!’–the same thing they shouted during the protests against Pinochet. There was dancing until two or three in the morning, on every street corner there was a group, throughout the barrio, in many barrios of Santiago.”

“The left thought that repression had destroyed these kinds of social ties. At a certain point those relationships became invisible, but when something really big happens, they resurface, because there is still a latent memory of them. And people help each other again. The same thing happened with earthquake,” adds Cristian Olivares, another student in the Diatriba collective.

On the outskirts of the city, men and women who hadn’t marched since the “return” of democracy in 1989 took to the streets again. And they did so in the ways that those who have little often do: singing, dancing, sharing food and drink and turning a protest into a party. In fact, this was a vast mobilization against social inequality in a country that the United Nations Development Programme says is among the 15 most unequal nations in the world.

Unequal Education

Ever since the neoliberal reforms of the Pinochet regime, education has been a commercial product. Contributions from students and their families finance 75 percent of the education system; just 25 percent comes from the state. At the university level, seventy percent of students take out loans and go into debt to finance their education.

Education is also highly segmented. According to Garcés, there is one system for the rich, another for the middle class, and a third for the poor. At the secondary level (high school), 7 percent attend private schools, which cost between 300 and 500 dollars a month. The middle class (about 50 percent of all secondary students), attend semi-private or government-subsidized schools operated with a voucher system. They pay a small amount (from 40 dollars a month), and financing is shared with the state. The poorest students attend “municipal schools,” which have few resources.

The semi-private sector is dominated by a group of small businessmen who profit from state vouchers. They are authorized to have up to 45 students in a classroom, while private schools cannot have more than 35. Forty percent of those who enroll in municipal or semi-private high schools cannot comprehend what they read; 70 percent do not score high enough on entrance exams to attend university.

At the university level, social inequality translates into indebtedness; there is no free, universal access to a university education. The deregulation of the system during the military dictatorship (1973 – 1980) also led to an increase in the number of private universities. There are now 60 private institutions, where the cost of a degree varies between $150 a month for social sciences and $1,200 a month for engineering or medicine. To finance their educations students have to obtain bank loans and go into debt.

Faced with this situation, students are proposing that natural resources are nationalized and used to finance public education. There is a precedent: Pinochet did not privatize the Chilean state copper company, Codelco, and by law part of its profits are used to finance the armed forces. Not surprisingly the student movement has support among the middle class, even in the some of the more well-to-do neighbors of Santiago.

Student control of schools

A half hour from Santiago, the borough of San Miguel reflects the various levels of “middle class”: from those who live in high-rises along broad avenues to those who live in precarious little houses. Formerly one of the largest boroughs of the city, its poorest barrios (such as La Victoria) have been torn away in an effort to turn San Miguel into a strictly middle class neighborhood. Nevertheless, it continues to be plagued with social contrasts.

Secondary School A-90 started the year with 179 students, but a decade ago there were 4,000. Students left to go to subsidized schools, which are reputed to offer a better education, although their evaluations suggest otherwise. The borough’s socialist mayor, Julio Palestro, is one of the mayors who have supported the privatization of education. In 2009 he closed a public school where 2,000 students were enrolled.

At the assembly in the gymnasium young people explain that their school ranks number 14 on the list for “academic risk.” Asked what that means, they smile: “It refers to the risk that we will become criminals.” Most of their parents work for little more than minimum wage (180,000 Chilean pesos, around $350), primarily as construction laborers.

Maybe that explains why the management is obsessed with discipline. “It’s as if we were locked up, this is practically a jail,” says Yergo, a third-year student. Camilo, a second-year student, is happy not having to wear a uniform. “It’s like a military doctrine, everyone with their crew cuts, their little ties, shirt tucked in. Don’t do this, don’t do that. And now [that the students run the school], you can just be who you are. You can just freely express yourself, you come here to be educated, not to be militarized.”

“The assembly is the control center,” Cristóbal explains. “All students participate and at times it’s open to teachers. We have watch duty and volunteers come in to make meals. Teachers teach, but they also learn from the students. At the beginning we had classes subject by subject, but later we saw that parceling out knowledge wasn’t the real way to learn, and we all got together for each subject. Some [students] explained to others, and the education became cooperative. That changes the way you relate to the subject and to the school.”

Just as workers who take over a factory change the way work is organized, students who took over their schools changed the “curricular boundaries.” Students need to know their rights, says Cristóbal, so they offer classes on the Constitution. “Philosophy, for example, lends itself to analyzing mobilizations and what is happening in the world; we begin to see that students work better if they are more interested.”

Juan Francisco, a philosophy teacher, agrees with his student. “All the student discussions have led them to reflect on the structure of power in Chile.” That’s why they analyze the constitution in his classes. Often they hold workshops, which furthers participation. Weekly assemblies have been incorporated into the curriculum.

The relationships between students and teachers have shifted. As hierarchies melted, relationships became more cooperative and supportive. In the classroom, they sit in a circle. The teacher is someone who helps, but is not above the rest. Eliana Lemus, a teacher of biology, chemistry, and physics, and principal of the school, maintains that discipline is much greater than it used to be, perhaps because it is not imposed and there is a desire to be together and share the experience.

One of the most notable accomplishments of the student movement is the effect it has had on the barrios, where it has increased social organization. At public school A-90, the parents association now supports the student takeover and control of the school. Cacerolazos in San Miguel led to “territorial assemblies,” where neighbors go to discuss problems in the barrio, as well as general problems such as education. Similar groups have been reported in other Santiago barrios, with up to 200 neighbors in attendance.

But not everything has been positive. Several teachers say they have been threatened and beaten by colleagues who do not agree with the takeover. The socialist mayor, a strong opponent of the movement, beat up Cristóbal Espinoza, a student and spokesman for A-90.

The future of those without a future

The 2011 student movement is the third such movement Chile has experienced in the last decade. In 2000 secondary students took to the streets to demand transportation, in what was called the “mochilazo” or the “backpackers’ movement.” In 2006 there were large demonstrations and schools were occupied, leading to the resignation of the Minister of Education and a partial modification of the education law.

The “Penguin Revolution,” named for the official school uniform of the protesting junior high students, was the first successful movement of the democracy. It was as massive as it was innovative; decisions were made in assemblies, with direct participation and a lack of hierarchy. But for Mario Garcés, “the 2006 secondary school movement was co-opted or trapped in the halls of La Moneda [the seat of the national government] and fell through institutional cracks.” President Michelle Bachelet created a commission of experts, with little student participation. They drafted a new law, but, nevertheless, did not remove the profit motive from the educational system.

This time around, however, the movement is not limited to students, nor is it exclusively focused on education. Chile is going through a crisis of legitimacy brought on by the inability of the political system inherited from the dictatorship to meet social demands. As the “Manifesto of Historians” points out, society is debating again, questioning top-down authority and enacting “forms of direct and decentralized democracy.”

This “politics of the streets” shows a “vocation for power” that questions the way the transition to democracy has taken place, a transition “alienated from social movements,” according to Garcés. Not only are people returning to the streets, they are also doing another kind of politics, broadening the movement, reaching out to the poor in ways that the movement in 2006 did not.

Finally, new practices form new people. Marcela Moya, an English teacher at A-90, points out, “the articulate fluidity the students have when they speak out, their self-discipline.” This is a personal evolution that is not all about the individual, but instead is collective and political. That suggests changes that are far more profound than what we see on the surface: “This movement has given rise to individuals who I know are going to be 100 percent committed to the society of the future, because they themselves have made that future possible.”

Raúl Zibechi is an international analyst for Brecha of Montevideo, Uruguay, lecturer and researcher on social movements at the Multiversidad Franciscana de América Latina, and adviser to several social groups. He is a columnist and also writes the monthly “Zibechi Report” for the Americas Program.

Translation: Barbara Belejack

A system of organized violence

January 27th, 2012

Protestation.org

From: http://socialistworker.org/2012/01/27/a-system-of-organized-violence

by Paul D’Amato

War and conquest has accompanied capitalism from the beginning.

January 27, 2012

CAPITALIST COMPETITION has never been based on peaceful exchange.

As Karl Marx wrote, if capital can get 100 percent profit, it will “trample on all human laws; 300 percent, and there is not a crime at which it will scruple, nor a risk it will not run…If turbulence and strife will bring a profit, it will freely encourage both.”

It’s true that the most powerful states and corporations can often impose their will without resorting to violence. This has certainly been the case, for example, with International Monetary Fund “structural adjustment programs”–where loans are advanced to poor countries on the condition that they privatize, cut public spending and open up the foreign investment.

But where financial coercion fails, the threat–and use–of violence, has always been an important way in which states have promoted the economic interests of their own ruling classes.

For example, the U.S. engaged in what was known as “gunboat diplomacy” in the early part if the 19th century. The U.S. would send the Marines to a Caribbean island that was having payment problems and simply take over the customs house.

War and conquest accompanied capitalism from the beginning. With the world’s most powerful naval fleet, Britain seized and plundered India, destroying its indigenous textile industry in order to force British textile products on them.

But even before that, with the emergence of the world’s first commercial powers in Europe in the 15th and 16th centuries, violence was the rule rather than the exception.

In fact, the accumulation of capital necessary to fuel the development of industrial capitalism in Europe came from the plunder of the Americas and Africa–especially from the development of the slave trade.

Marx wrote:

The discovery of gold and silver in America, the extirpation, enslavement and entombment in mines of the indigenous population of the continent, the beginnings of the conquest and plunder of India, and the conversion of Africa into a preserve for the commercial hunting of black skins are all things that characterize the dawn of the era of capitalist production.

- – - – - – - – - – - – - – - -

AT THE time Marx wrote about modern industrial capitalism, it had barely developed in Britain and a few European countries. But as the 20th century approached, capitalism became truly global.

Capitalist production burst the bounds of the nation state and was forced to seek outlets overseas. The result was not only economic competition but military competition between the great powers on an international scale.

As early as the 1870s, Frederick Engels could write, “Militarism dominates and is swallowing Europe…Competition among the individual states forces them…to spend more money each year on the army and navy, artillery, etc.?

In the period after Engels wrote this, the most powerful states–Britain, the U.S. Germany and France–scrambled to divide the world. Their new colonies provided raw materials, cheap labor and markets for their goods and investments.

As the earth was carved up into “spheres of influence,” competition between the great powers for who would control the biggest markets intensified. A “balance of power” was maintained by each state arming itself to the teeth–a balance continually in danger of being upset by the emergence of a new power eager for a slice of he imperial pie.

Writing at the time of the First World War, Lenin described the new period of capitalism as “imperialism”–a system characterized by the domination of giant capitalist monopolies inside the borders of the great powers and competition among the powers on an international scale.

Lenin’s analysis was crucial because it pointed out that imperialism isn’t a policy but a new stage in the development of capitalism that grew out of earlier conditions. The logic of imperialism is international economic competition between states–leading to war.

There were people at the time, like the German social democrat Karl Kautsky, who argued that the creation of a world market and economic interdependence of nations would make war obsolete.

Just the opposite was the case.

Tens of millions of people died in the world wars fought to decide which country would, the words of Leon Trotsky, “be transformed from a great power into the world power.”

First published in the May 12, 2000, issue of Socialist Worker.

Paul D’Amato is managing editor of the International Socialist Review [2] and author of The Meaning of Marxism [3], a lively and accessible introduction to the ideas of Karl Marx and the tradition he founded. Paul can be contacted at pdamato@isreview.org [4].

Freedom of man

January 27th, 2012

Protestation.org

From: http://english.pravda.ru/society/stories/27-01-2012/120343-Freedom_of_man-0/

by Welinton dos Santos

This is a time of great reflection on our values, attention to our attitudes, actions and thoughts, remembering our loved ones, nature and the world.

Many of us survive in a society in which we passed through several schools with varios scholastic systems, reproductivist French theories of human capital, unschooling of Illich, among many other skills that always sprang into the mechanical structure of our social life, punishing the self-taught person, controlling and shaping knowledge, based on the principles of a ruling dominant bureaucracy.

The humanity which was submitted to the dictatorship of unbridled capitalism suffers the consequences of coldnesses towards nature, in an incessant search for wealth and selfish individualism, who was taught from our heritage of Jesuit scholastic teaching. It had absolute control over the content that prevails up to the current day. This content requires being conscious to the truth, under the presupposition of a cleansing reality of the conscious truth, individualist and voluntarist, with restrictions on freedom, spontaneity, creativity and active participation of knowledge.

The result was the lopsided social division in the bureaucratic cadres, and without archaic structures of ideal values focused on the need for exchanges between individuals, family, society, cordial relations with happiness and collective performance for the common good. The artificial was considered as an ideal, in relentless pursuit of material goods to the detriment of spiritual values that enrich and perpetuate the good of the collective actions of social interaction.

In this presupposition I ask: _ how much are you in love with life itself?

This moment in time is for freedom. Man, no longer at the mercy of the imposition of knowledge, tied to corruption, acts on the inconsistent acts on nature, of dislike towards other living beings, the lack of being able to see the reality of what happens that is gross and cruel in the four corners of the Earth, where infanticide can occur at any moment or in prison cells in which human beings are killed to increase space in the cell, or even contaminated products thrown into the water, the death of animals made inconsequential for the sake of wealth or cutting down some trees on behalf of someone against the air that supplies mankind.

It’s time for all to unite in favor of a new society based on the actual values of unity and not division, in which all religions must share for the collective good, because we are all children of the same soil and live on the same planet.

We must respect the collective rights over the individual, while creating forms of financial balance and abundance for all people, based on a ballast of sustainability.

There is no time for new studies, but for new attitudes, new values, new understandings and the new building, after all what good is it if I live in a palace and the world is in ruins and unable to receive love from anyone.

Harsh realities will affect the world in the coming days due to the consequences of the disrespect of ‘Mother Earth’, but there is still hope, of solidarity between all who read this article and I ask that they have more patience, tolerance for differences, care for their loved ones and to persevere in faith, love and respect for others.

Like a road, the paths are drawn. As on a road, the paths are traced, and it’s necessary to have in your hands the vehicle which leads love along its path for the victory of light to arrive in our lives

Make your heart sing with the sunrise, see the garden grow, embrace your children, behold your loved ones, vibrate with the sounds and smells of flowers, after all the world can feel the beauty and love. I’m rooting for all of us!

Welinton dos Santos, Economist and Lecturer

Parasite Capitalism: Human Awakening Calling Time On the Beast

January 27th, 2012

Protestation.org

From: http://www.globalresearch.ca/index.php?context=viewArticle&code=CUN20120127&articleId=28898

by Finian Cunningham

Listen to this fable. A man was lying in bed, tired and tormented. Tired because it was the early hours and yet he could not sleep; tormented because the cause of his tiredness was a mosquito, lurking somewhere in the darkness that would sporadically make its presence known by homing in on the man’s head, its whining buzz ringing in his ear. Try as he might, the man could not find any rest. Covering his head with the bed sheet only made him hot and breathless, the clammy discomfort made all the worse because of the climate.

Furthermore there was the hateful, capricious presence of his tormentor. Just when tiredness was overcoming the man, luring him to sleep, his tormentor would descend with its wicked whining on the other side of the sheet. Jolted by the sound, the man’s irritation would surge again, knowing that another hour of sleeplessness would have to pass.

His mind began to wander into squeamish thoughts. If he submitted to his tormentor’s desires by throwing off the sheet from his head, gaining some air to breathe and some badly craved minutes of sleep, then the mosquito would as sure as hell take its toll. The man pictured the ruthless parasite gorging on his blood while sleeping. He was nauseated by the idea of an alien creature being able to violate his skin with impunity and dipping into the well of his lifeblood, sucking his body’s vital fluid until its spindly belly became grotesquely bloated. The horribleness of the process disgusted him, terrorized him.

But also the squalid, gratuitous relationship filled him with anger. All at once his anger redoubled because he then realized that he – a man – had wasted so much of his precious rest time cowering under a sheet intimidated by an inferior speck of an insect, which in daylight he recalled is actually a very ungainly, insipid kind of creature that can easily be captured and crushed.

The man wasn’t yet working to a premeditated plan. Angry and exasperated, now fully awake, he simply decided to throw off the sheet and enjoy the cooling air. Lying full-square on his back, at first he felt a certain amusement from his petty show of defiance. What he would do next, wasn’t quite in his consciousness. He was just for the moment merely taking in fresh air.

Then out of the blackness, it came again, the wicked whining. Louder than ever, it seemed, the tormentor was drilling towards his bare face. But this time the man did not shirk or take shelter under the sheet. It was probably a mixture of irritation and anger that made his hands snap together in reflex, not consciously. He was surprised by his own quick, powerful action. And what was even more surprising to him was the subsequent silence. At first hardly believing his luck at catching his tormentor in pitch darkness, he then became elated by the sustained silence that meant that the torment was over. He had at last acquired rest and he luxuriated in the satisfaction of earning it. To be sure, in the scheme of things it was only a small victory, but nevertheless the man allowed himself the pleasure of knowing that he had asserted his will deliberately, purposefully for the comfort and peace of his mind and body. No longer would he be subjugated by a fiend. Henceforth, or at least for the rest of the night, this man would be the subject of his own fate.

The parasitical nature of late capitalism in the early 21st century is beyond comparison to a pest such as the mosquito. The lifeblood sucked from the body of society by a tiny ruling elite is oceans in volume by comparison; the human misery and suffering magnitudes worse. Prolific journalist Stephen Lendman can provide the shocking data on the United States of America in particular and how that society has within the space of a lifetime been bled utterly dry by the Wall Street banks, corporate oligarchs and their servile political Igors in both mainstream parties, including the occupant of the White House [1]. The same torment of the large body of people by a parasitical elite is replicated in Europe and elsewhere.

That is the ineluctable fiendish nature of global capitalism, which over generations feeds on the lifeblood of workers, and emaciates them and their families, while the system’s executors become bloated to the point of bursting, with all the wastefulness and destructiveness, including wars, that that entails. There is no way of legislating against such parasitism because the legislators are, or will sooner or later become, part of the parasitism – as the rich get richer and power and wealth inevitably polarize under capitalism. It is like a centrifugal force; always taking, taking, taking until the majority are left looking like a spent liquid to be discarded. Look at every nation state under the diktat of capitalism at this time in history, and dare say that that isn’t so.

The only protection to be gained is from crushing the system and replacing it with a different paradigm of relationships (democratic socialism – an alternative that has scarcely ever been given the chance to develop under the tyranny of capitalist imperialism).

In truth, this is not an impossibly tall order. The tormentor is in actual fact puny in number and size when compared with the collective body and power of the people. In many ways, the tormentor is only able to continue his parasitical tyranny because the people have chosen thus far to cower and take relative disorganized shelter. Or worst, they have fallen asleep from weariness, assigning themselves completely to the mercy of an insatiable feeding frenzy.

But signs are that the great body of humanity is finally beginning to rouse in anger, precisely from a painful understanding of how it has been and is being tormented. The world is awakening – thanks to global communications – and no more so than in the United States, where it is arguably most needed. And like the man in the above fable, a moment of determined organization could be all it takes to suddenly overturn a state of fear and torment into one of joy and freedom.

Finian Cunningham is Global Research’s Middle East and East Africa Correspondent

cunninghamfinian@gmail.com

NOTES

[1] America’s Great Divide Between Rich and Poor by Stephen Lendman http://www.globalresearch.ca/index.php?context=va&aid=28812

Can Occupy Save Labor? The People United Will Never Be Defeated

January 27th, 2012

Protestation.org

From: http://www.globalresearch.ca/index.php?context=viewArticle&code=ZEE20120126&articleId=28894

by Kevin Zeese

The labor movement has been in decline for decades, while more than one-third of employed people belonged to unions in 1945, union membership fell to 24.1% of the U.S. work force in 1979 and to 13.9% in 1998. Today, including all workers public and private, 11.4% are union members, for workers outside of government it is only 6.5%. Restrictive laws make organizing workers very difficult so a new strategy is needed to increase worker power. That strategy needs to include uniting unions, non-union workers and the people. The 99% needs to see that it is everyone’s interest to have a strong labor movement.

The Occupy Movement has shown itself to be very pro-labor, as can be seen in the outline of Occupy Washington, DC’s position statement: Worker’s Rights and Jobs. But, we are not in lockstep with union leadership. Indeed, perhaps the most important difference is we are independent of the two political parties, while most unions are closely tied to the Democratic Party – and have been closely tied to the Democrats throughout the decline of the union movement.

One task of the Occupy Movement will be to pressure both parties to end restrictions on the rights of worker’s to organize. Many see the passage of the Taft-Hartley Act in 1947 as the foundational step to union decline. The law, which passed with majority votes from both parties to override a presidential veto, limited the rights of workers to organize, support each other and made it difficult to start new unions. In addition, lack of enforcement of laws that protect unions from plant closings weakened union power. Race to the bottom corporate strategies seeking lower wages in states not friendly to unions, and now leaving a country to go to developing countries for cheap, virtual slave, labor has been a key to weakening workers. Policies can be developed to protect workers, but there is no backbone in the Democratic Party to do so, and the Republican Party is hostile to unions.

No doubt new approaches and new militancy is going to be required for the labor movement to be revived. Merely managing the shrinkage of union members is a strategy for failure. Not challenging laws that block union organizing ensures union failure. Staying allied with a corporate-funded Democratic Party that has stood by while unions declined is a sure way to the end of labor power. A break from the past fifty years is needed to deal with globalization, change to an information and service worker-dominated country from a manufacturing country. These are all very challenging tasks for labor leadership.

The Occupy Movement could be a critical ingredient in the revival of unions. Unions had been an essential weight balancing against the power of concentrated wealth. With the decline of unions we have seen wages for Americans peak in 1973, the minimum wage losing one-third of its value since its peak in 1968 and workers having a smaller and smaller percentage of the GDP. The weakening of labor has been a key ingredient to the increasing concentration of wealth and political power in the hands of the 1%.

Yesterday we saw an example of how the Occupy Movement, working with labor, can achieve victories for workers. West coast longshoremen seem to have resolved an important multi-year labor dispute, with the help of the Occupy Movement. In “Showdown Averted,” after describing the valiant militancy of longshoreman, Ben Shreiner writes:

“. . . one cannot overlook the impact the Occupy movement also had in bringing pressure to bear on EGT. For example, the December Occupy-led West Coast port shutdown, called in solidarity with Local 21, succeeded in shutting down port terminals in Oakland, Portland, and Seattle.

“Moreover, a solidarity caravan set to ferry both ILWU rank and file and occupiers from Seattle to Oakland in an attempt to block EGT’s looming attempt to begin operations at its terminal had raised the specter of thousands of protesters converging on the Port of Longview. In fact, fearing a potential mass protest, EGT had resorted to calling on the US Coast Guard to safeguard its vessel and terminal.

“Undoubtedly, such a combination of pressure coming from both the union and the greater community factored heavily into EGT’s calculus to return to the bargaining table.”

It is not just the Occupy Movement that was key to this seeming success, longshoreman militancy was also key, Shreiner writes:

“On two separate occasions, for instance, ILWU Local 21 and their supporters blocked trains from reaching EGT’s scab facility. And back in September, longshoremen stormed the EGT terminal, allegedly dumping grain from an idle train car.

“Of course, such militancy has also extracted a heavy toll. To date, the union faces more than $300,000 from numerous fines and federal injunctions. The longshoremen and their families, meanwhile, have been subject to 75 arrests, 200 citations, and various other means of police intimidation and harassment.”

The uniting of union militancy with Americans in revolt seems to have turned this conflict into a victory for workers.

Before claiming victory, the details of the settlement will have to be released and approved by the workers, but even so, this example shows how the Occupy Movement — united with labor — can protect worker’s rights. This is an example we can build on to weaken corporate power and strengthen worker power as part of our efforts to shift power to the people.

Kevin Zeese is an organizer with Occupy Washington, DC, co-director of Its Our Economy and co-chair of Come Home America.

Decision Making under Capitalism and the Impossible Survival of Humankind

January 27th, 2012

Protestation.org

From: http://www.globalresearch.ca/index.php?context=viewArticle&code=GON20120126&articleId=28890

by Prof. Pablo González Casanova

Three epistemological problems seem to be inescapable: that of “the uncertainty” that characterizes a considerable part of scientific research, particularly of a historical and social nature; that of “the impossible,” which can be specified in logical, mathematical, and systemic terms; and that of “capitalism” which in its deepest meaning pertains to the realm of “prohibited knowledge” in academia.

It is necessary to define the boundaries of these obstacles. Otherwise, one might regard the thesis that we are trying to uphold as false: namely that the decisions of those who are at the head of the “capitalist means of domination and accumulation” lead to a situation in which human survival becomes impossible. Although it is a harsh thesis, its rejection by those who have the capacity to decide implies the cognitive self-destruction of the selfsame dominant groups and of those who form part of it. No matter how much one tries to open their eyes, even if it may seem illusory is very important. Research and communication of critical and scientific thought should be put forth not only for those who are already convinced, but also for those who have the capacity to make decisions, but who do not have the capacity to perceive and resolve the problems that threaten their own life and that of the human race.

These statements invite the elimination of the three obstacles mentioned as epistemological problems.

When Heisenberg discovered the “principle of uncertainty,” he also found “the specter of certainty.” Without specifically referring to him, Wallerstein often recorded the times and spaces of certainty in historical and social sciences. Similarly, the “technosciences” and the “sciences of complexity” expressly set out to diminish uncertainty through information and organization in which they may operate. Within their cognitive margins, their achievements are considerable. Recognition of the principle of uncertainty tends to increase the validity of scientific research that recognizes it to overcome it.

As for the validity of “the impossible,” it has been repeatedly confirmed not only in mathematics, but also in the very logic of historical and social systems. If that validity is not absolute, it is verifiable in some fields, although it may be invalidated in others. It tends to appear as “obvious” in arguments and as “stubborn” in points of fact.

As far as the concept of “capitalism” it is worth pointing out that among its essential features we accentuate those that refer to a “means of domination and accumulation” whose principal interest or main focus of “attraction” is maximization of profits and wealth, as well as the power that gives security to its beneficiaries and guarantees the continuity of their “lifestyles” and of their real and formal “values.” Other definitions—such as those of Max Weber or Joseph Schumpeter, and even some of Marx himself, in their economist collapses—have less depth and less potential for analysis.

Starting with these elements, we would like to reaffirm with certainty that human survival is impossible in the context of the continued domination of capitalism and its supreme logic: maximization of profits and defense of the values and interests of the dominant forces.

It is necessary to clarify another point. Given the impossibility of the survival of humanity under capitalism, the overcoming of that “means of domination and accumulation” also becomes “insufficient,” because the “collapse” of capitalism itself does not guarantee the survival of humanity. The “collapse” of the system might lead to a “Mutually Assured Destruction.” In the means of domination and accumulation that replaces it, forms of primitive accumulation and depredation might prevail that have already been accentuated in recent history. Awareness of these facts implies tremendous responsibility for sciences and social movements. Preventing “the fatal outcome” concerns both the dominant forces and the alternative ones, as “sick” as they may be in their desire to accumulate riches and power, and as “furious” as they find themselves victims of indescribable sieges and plundering.

The comprehension of the problems in today’s world can only be achieved if one notices the new situation of history. We live at a time of crisis in which not only a social system is at stake, but also the preservation of the ecosystem. For the first time in history, it is not merely a matter of taking steps on the road to human emancipation; instead, it is to ensure the very preservation of human life. Thinking of the crisis and its alternatives implies a demand for scientific rigor and responsibility in decision-making so that both ensure emancipation and human life.

This is not “scientism,” “superficial morality,” or “blackmail.” The impossibility of human survival under capitalism coincides with the difficulty of a peaceful transition to a system that guarantees human emancipation. Resolving both problems falls within the ken of historical creation. Its possibilities can perhaps be found in the logic of a new social, political, and ecological contract that at this moment seems to be mired in good intentions and feeble, idealistic reasoning.

Accounting: A Universal Language

It is difficult to understand the problems in today’s world and their alternatives solely on the basis of our culture of “experts,” “academics,” and “intellectuals,” with our habitual proposals, methods, and styles of debate. Our weakness, typical of incomplete knowledge, arises as long as we do not fully understand how problems and solutions are thought of in circles with “decision-making power” and in alternative, systemic, or anti-systemic social movements with their “knowledge” and practices in the construction of other possible worlds.

Within the academic or pundit subculture that we belong to, our research generally remains in the realm of observations, predictions, and calculations of risk, of disequilibrium, of alternative measures or policies. We characteristically focus on those who do not participate in the ways of thinking and deciding as a “last resort” or a “bottom line.” Not only do we take for granted the thought that arises beyond the world of “specialists,” but we also limit ourselves to studying the problems within certain specialized areas and we scorn others that, in the case of certain problems, might actually be closer to the real world, in this case with decision-making “by the rich and powerful” in terms of their business and power.

In the ecological crisis it is not the norm to analyze the problems in accounting terms and with accounting-based reasoning. If we do so, it is to calculate the totals of a governmental or private environmental plan, or the expenses budgeted or spent by the public sector to resolve environmental problems, or the proportion reached by environmental items of the GNP. In research on critical thought, accounting is used directly or indirectly to calculate trends that lower profit rates. However, in all of these cases, we lose the accounting reasoning of managers and shareholders of an enterprise who think in terms of costs and benefits that different political proposals might have in facing the environmental crisis. If we move from a “macro” analysis to “micro” phenomena and to decisions that appear to be self-destructive, we are thinking in terms of a “crisis of instrumental reason” or schizophrenia that is taking us to the destruction of the world. In none of these cases can we see how one reasons in capitalism and how that form of “normal” reasoning makes the survival of humanity impossible.

In order to support this thesis so that it not be invalidated in scientific dialogue, it is essential to analyze “profit making” that corresponds to the accounting-based reasoning of those who hold interests and responsibility in private companies. Based on the accounting mentality of entrepreneurs—shareholders and managers—(particularly those who are owners and directors of mega-corporations with their partners, subordinate companies, and subcontractors) we can enter into a type of reasoning characteristic of the brand of capitalism that is producing today’s problems and that threatens freedom and human life itself.

Entrepreneurial accounting allows us to get closer to the intimate logic of the complexes that articulate the thinking and action of world domination and accumulation. If dominant power displays varied positions, what tends to prevail are those who think, reason, and make decisions in terms of the cost-benefit of each one of their projects and of the overall corpus of projects for their enterprise, or for the field in which their enterprise operates. By extension of similar interests, this applies for all companies and entrepreneurs that handle similar, more or less articulated products or services and with the “complexes” in which they form a part on the side of the military and politicians.

In the first place, the problem consists of scientifically re-evaluating the discipline that has been most scorned by technocratic or critical analysis in today’s world, in other words the accounting mentality of corporations and the way it is applied and understood by shareholders and management. Following the reasoning of governmental accounting and auditing and of social “costs and benefits,” we do so after considering corporate auditing, which represents, with greater intimacy and depth, a logic that is already distorted by the media in national, state, or social accounting.

Corporate accounting, as a technique, clarifies how in full awareness and on a regular basis the major decisions that are threatening the destruction of the environment and the ecosystem are made, and why this would occur as long as capitalism continues to be the dominant means of production, accumulation, and destruction. Using corporate accounting as a starting point does not imply that we are unaware of the greater scope of reasoning over costs and benefits that are not materialized in books and corporate accounts and which “investors” have in mind; nor does it imply that in decision-making in today’s world we abide by the “profit making” of entrepreneurs and shareholders, to give only secondary importance to the logic of “security” and “the defense of values and interests” on those who make decisions.

On the contrary, by starting with the accounting-based vision of a company and seeing how it clashes with the need to build an immense space of political, cultural, economic, and social interventions allows us to confirm that from the intimate reasoning of the company to that of the world, in the final instance, the logic of maximization of profits, power, and wealth, or of “the modes of consumer society” that prevail among those who benefit from the means of capitalist domination and accumulation, makes the survival of humanity impossible. If that “means” continues, humanity cannot survive and if humanity survives, that “means” will not survive.

Government accounting and auditing contain objectives and values in which economic reasoning alone is distorted by the media, corrected, and complemented by political reasoning. Here the possibilities of escaping the mere Midas syndrome arise, although they do not exclude it. The intervention and media distortion of the means of accumulation and domination only serve to confirm that with all of their intervention and media distortion, the survival of humanity is impossible under capitalism.

Some Possibilities and Limits of Accounting-Based Reasoning

In accounting-based analysis, this includes “keeping two sets of books” for tax fraud and transfers, for bribing officials, for “money laundering,” for monetary and mercantile speculation, for the manipulation of outsourcing surplus. In all of these fields, accounting or the accounting mentality of companies, and above all of mega-corporations, their managers and shareholders help to clarify the advantages and disadvantages of neoliberal policies for those who are beneficiaries of the accumulation and domination of capital. They also contribute to explaining the lack of interest or the outright rejection of the slightest measures that conservation of the environment would require and that in many cases would imply that a company cease to do business or that would diminish the company’s profits, or even that would suspend plans for new enterprises that are already under way. These and other lines of reasoning touch on problems that go beyond accounting. The complex of corresponding interactions lead to the true calculation of income and expenditures, adding the amount of accounting tricks, in a businessman’s mentality, that way of thinking of those who zealously defend “business as usual” or “the American way” and of those who insist on laissez faire policies that can be summed up in the expression “mind your own business,” which is the one followed by the U.S. model, which is a paradigm for businessmen and for Heads of State.

There is a huge gap between accounting and entrepreneurial reasoning; nonetheless, this is enriched by reasoning from politics and power, by that of violence, repression, co-opting, corruption, intimidation, and persuasion in the struggle “for hearts and minds.”

Environmental problems cannot be separated from economic, political, military, and cultural ones. The major shareholders and management deal with all problems from the most significant angle before making decisions. Their “background” or “curriculum vitae” might be as entrepreneurs or as former politicians or military men who became entrepreneurs, the case is that in “military-entrepreneurial and political complexes,” the members of these groups never forget “to do accounts,” nor do they overlook the incalculable “values and interests” that ensure their businesses and lifestyle: “the American way of life” and that of the rich and powerful at other latitudes.

Accustomed to a process of legalization that had worldwide political bodies that legitimized the decisions made by the powers that be, the military, entrepreneurial, and political classes negotiate depending on how they perceive the correlation of internal and international forces. Organized into “power groups” they are articulated as “lobbies,” “pressure groups” or “interest groups.” With that, the so-called “political class” legalizes and justifies the use of public resources for repression, concession, intimidation, persuasion, negotiation of what the powerful define as “negotiable” or “non-negotiable.” With ties and “lobbies” of the same type—and other similar ones—they make accounting decisions and consensual policies. With this, they meet and confront policies on natural and human resources that lie within their borders or beyond, and they exert and spread the influence of transnational enterprises and networks of associate and subordinate complexes.

The main focus on accounting reasoning makes it possible to understand the “decision-making” of these military-industrial-and-political complexes. It allows us to better understand why the representatives of the “political class” in organizations and international congresses do not take into account, and in fact go so far as to reject, the diagnoses of the most respectable experts concerning the serious threats to the biosphere and the ecosystem, despite the fact that many of these threats have become more dangerous and have already confirmed the diagnoses and forecasts that scientists have made in the last fifty years.

Among the foremost types of accounting and non-accounting costs that imply the solution to the greatest threats to life on earth are those in which the following predominate:

1) The costs of containment, reduction, and elimination of entrepreneurial or technical procedures that lead to environmental problems.

2) The costs of containment, reduction, or liquidation of companies or techniques that would charge government treasuries or that would be the focus of expropriation or closures wielding arguments such as the “environmental debt,” defined as what expropriated companies owe to humanity.

3) The costs of eliminating neoliberal policies.

4) The costs of halting “developmental” policies that place the burden on developing nations and societies, and above all, on “underdeveloped” or “dependent” ones (depending on their variations in marginalization and exclusion, of formal or informal colonialism and neocolonialism).

5) The costs of reduction or doing away with today’s “model” of “consumer society” that, in the event of disappearing, would affect a large number of enterprises and would constitute a sort of revolutionary threat.

6) The costs of attenuating or doing away with poverty, marginalization, the exclusion of the immense majority of humanity.

7) The costs of casting aside the policy of depredation of natural and human resources and measures of “internal warfare” and of open or covert genocide of the excluded, “disposable” population. The costs of permitting and even fostering autonomous, self-governing, and self-sustainable communities in search of a means of domination and accumulation that distances them from the dangers of biosphere destruction and ecocide, entirely new measures of an uncertain, revolutionary character.

When one thinks in terms of the margin of operation that must not be exceeded, of avoiding the creation of a threat for humanity—and whose costs are indeed immense—it can be seen that the margins have already been surpassed in a dangerous and at times irreversible way: climate change, acidification of the earth’s seas, and the hole in the ozone layer. Irreversible changes have already taken place in the loss of biodiversity, water sources for human consumption, and the nitrogen and phosphorous cycles of oceans.

If one limits oneself to the major problems of exhaustion of non-renewable resources and overexploitation of renewable ones, petroleum, gas, and coal stand out with imbalances in the resources that each country has at its disposal and the amount that each one requires. This imbalance largely explains the expansionistic policies of big companies and world powers. Therefore, at the beginning of the twenty-first century, the U.S.A., which produces 40 percent less petroleum that it needs, sends the U.S. army to head the invasion of the world’s richest petroleum zone that runs from Arab countries, crossing the Middle East to Central Asia. To a large extent, the “oil thirst” explains the power plans behind the Israeli throne and western “democratic” invasions in Palestine, Iraq, and Afghanistan.

The entrepreneur’s viewpoint is fundamental in all of these areas and it extends: 1) to legal enterprises that are undertaken and that are permitted to be undertaken, 2) to informal or covert enterprises that are undertaken and are permitted to be undertaken, and 3) to enterprises that could be undertaken and that are not undertaken, 4) to enterprises that will be undertaken and that are undertaken.

In a preliminary list of costs, in which in addition to accounting-based reasoning in monetary terms, other values of those in a position to make decisions also appear. These values include security and domination, as follows:

Evidence of impossibility

Costs of reduction and elimination of risks of ecocide in the modern-day mode of domination and accumulation:

1. Costs of halting the “rationality” of large corporations.

2. Costs of halting neoliberal policies.

3. Costs of applying environmental and natural resource protection measures.

4. Costs of doing away with “secret banking” and other forms of “money-laundering” resulting from drug trafficking and activities that constitute criminal activities in positive law.

5. Costs of doing away with “tax havens.”

6. Costs of doing away with “money-laundering.”

7. Costs of applying minimal proposals made by the “panel” of intergovernmental scientists.

8. Costs of bringing an end to fiscal and customs “exemption” policies, payment deferral and cancellation of taxes, in order to augment scarce public resources to channel them into the resolution of environmental problems.

9. Costs that would imply stopping or de-structuring the agricultural industry to put an end to favored or imposed, authorized or illegal dissemination of transgenic and biofuel seeds.

10. Costs of doing away with “free trade” agreements that prohibit all subsidies, investment, or expense in favor of the rural sectors in dependent countries from where impoverished migrants flee, while large-scale agricultural-industrial enterprises in central countries, particularly the United States, continue to hand out enormous subsidies and governmental support.

11. Costs of resurrecting the projects of “Civilization,” “Progress,” “Development” originally conceived or as “universal projects” of wellbeing and social justice. Costs of substituting today’s deliberate “development of underdevelopment” project for a project that does not only undertake “humanitarian” actions, nor does it only apply the postwar social development policy with its immense trail of marginalized and those who were excluded.

12. Costs of putting an end to today’s model or style of “consumer society” widely stimulated by the Market and the State.

13. Costs of putting an end to “disposable” population that is “out of the market.” That population ranges between one to three billion inhabitants, according to recent indicators. Their accelerated growth is seen by many with a “neo-Darwinian”, post-modern colonialist coldness. “Neo-Darwinism” defends the “survival of the fittest” by sustaining that the subjugation and destruction of the weakest is a law of nature. In reality it is another way of expressing “racial purity” on a global level, a magno-genocide that with its secondary effects threatens to be terminal for the combination of earth and humanity.

14. Costs of setting limits and controls on production, traffic, and distribution of weapons and apparatuses of “open war” and “covert war.”

15. Costs of putting an end to drug-trafficking, which includes ongoing “smuggling” of high-power weapons and a huge “money-laundering” machine.

16. Costs of putting an end to air pollution in cities and urban zones.

17. Costs of putting an end to water pollution of seas, rivers, and lakes.

18. Costs of putting an end to the depletion of aquifer resources.

19. Costs of putting an end to deforestation, particularly the destruction of rainforests.

20. Costs of doing away with petroleum dependency.

21. Costs of doing away with other underground resources.

22. Costs of putting an end to nuclear waste, plastic and other waste products.

23. Costs of putting an end to so-called “ecological reserves” and their growing exploitation by transnational enterprises to preserve the original, local peoples and cultures.

24. Costs of putting an end to overexploitation of plant and animal species of the sky, water, and earth.

25. Costs of putting an end to modern-day plagues, such as AIDS and pandemics.

26. Costs of putting an end to “hunger.”

27. Costs of provoking and/or preventing nuclear war.

28. Costs of implementing nuclear disarmament.

29. Costs of putting an end to deregulated labor and with the informal labor sector of undocumented workers.

30. Costs of halting the “internal,” “covert” or “open war” (today known as “low intensity war”) that is waged against those “condemned to the land” of each block, backed by dominant political and military-entrepreneurial groups and their networks.

The Necessary Conclusion

The sum and political reasoning concerning the costs listed here is “dissonant” proof of what is impossible. However, we cannot stop there. The very sum of monetary and human costs forces us to consider antisystemic alternatives and the emerging transitions of those who struggle to build and who are building a new “means of domination and accumulation,” and a new hegemonic “system of emancipation.” The peaceful transition puts us face to face with an enormous problem. The selfsame radical alternative, antisystemic forces have already noticed it. Many of the organized media-distorting forces distorted by the media by a culture of protection, pressure and negotiation whose costs cannot be assumed by world capitalism have also noticed it. In all cases of awareness and the collective morality of transition, of the dangers to be overcome, as well as the best ways to overcome them constitute a new page in history.

The accounting propositions have to be fleshed out and expanded with other phenomena, parameters, and secondary effects, wanted and unwanted, open and covert. But let us not underestimate them as mere hunches. They display enough elements to be enriched and regarded as an axiomatic field. Within this framework of premises and as an axiomatic body, an inevitable consequence is that: the human species will survive if and only if capitalism ceases to exist. The disappearance of capitalism, it is well known, constitutes a necessary condition, although not sufficient in itself to achieve the survival of the human species. In mathematics, the necessary conditions constitute the foundations to formulate non-linear models of multiple interactions (i.e., “complex”), which may be related with possible transitions to a post-capitalism capable of the survival and the emancipation of Humanity.

Given that we refer to the necessary conditions that are not sufficient in themselves, we cannot discard scenarios that, albeit not capitalistic, maintain the privileges of the current system, even when changes takes place at a high human cost. In historical and systemic analysis, it will be possible to cite specific contradictions of capitalism that point to its end and that in themselves are not sufficient to impede a nuclear world war or to achieve human emancipation. In any event, the problem that remains a priority is what can be done? And how can it be done? Today, in the alternatives and decisions not only is the idea to propose how to prevent the self-destruction of those who in their endeavors to defend the system are actually bringing about the destruction of the world. Instead, the idea is to build a path toward a redefined brand of democracy, liberation, and socialism.

Whatever decision or plan in today’s world faces a possibility that did not arise in earlier transitions: the possibility that human beings directly or indirectly destroy the human race by destroying the environment and the ecosystem. The conditions for certain universal destruction already exist and they cannot be reduced to natural phenomena, nor attributed to metaphysical, physical, or biological forces.

The evidence of the impossible continuity of capitalism leads to thought concerning the historical transition to a system different from capitalism. The new transition entails ensuring the survival of humanity to the maximum possible. Furthermore, it will induce an emancipation capable of assuming the values and interests that “praxis” have contributed or the practice of earlier theories. The historical movement is so new that it cannot be understood if it is only seen by using the categories known from earlier struggles. The theoretical and practical experiences express an emerging history, whose original forms must be recognized.

The transition is so new in human history and yet so experienced, that it is taking over the goals of several betrayed, frustrated, or senseless revolutions. In addition to the values of the French Revolution of “Liberty, equality, fraternity,” the values of the revolutions of Independence of the oppressed and exploited on the global fringes that Haiti began in 1802 and that first Marx and then Lenin, and many others enriched in the theory and practice of the struggle for a society without oppressors nor oppressed, without exploiters nor exploited.

The new movements return to the former struggles of slaves, serfs, or the masses, the proletariat who fought against colonialism, imperialism, neocolonialism. They also inherited and resumed the struggles of the “comuneros”, of “communes,” “soviets,” “cooperatives,” or “communities.” Their experiences of victories and defeats led them to take the necessary precautions to avoid acting as refugees, nor be destroyed or distorted in the media by military or civil bureaucracies. Furthermore, they added new goals and non-negotiable struggles. Of the worldwide movement of 1968, they inherited and made more specific demands in the struggles for freedom of critical thought and for a democracy that formally and truly was socialist, in other words truly democratic, and that recognized, together with the political and social rights of the citizens, nations, workers, communities, the need for the force of decision-making and implementation of those decisions resides in them. They postulated that in all fields, women, “blacks,” homosexuals, Native Americans, and ethnic minorities should participate in all fields. They fought for a multicultural society respectful of beliefs, ideologies and religions. That is not why they did not turn to “the most covert social relation” to defeat what is that of oppression and exploitation of some men by others, through salaries, wars of divestiture and subjugation, unequal exchange, and public debt, of the foreign debt “paid several times over.”

Moving away from the dehumanized references of earlier revolutions leads to serious confusion. From these, one begins to increasingly identify the importance of dominant interventions and the priority of constructing the right kind of interventions and to not overlook them.

The new anti-systemic movements display expression and reflections of a more refined and profound stage. Many of them come from different, distant cultures and without a central direction that interrelate them throughout the history of struggles.

The most recent stage of human emancipation has its main precursor in the Cuban Revolution. It is enriched by the movements of the indigenous peoples of Latin America and particularly by the Zapatista Mayas of Mexico, who “from below and with the underdogs” head a new, varied struggle for human emancipation. At the beginning of the twenty-first century, unforeseen alternatives have emerged. Latin America—as Noam Chomsky has pointed out with other words—stands at the vanguard of an emerging world history. In that region, social movement took on radical characteristics of a war for ideas, for active solidarity, and for peace, and they acquired incipient experiences of the military that was prepared to fight against its people, they fought alongside their peoples for another democracy, another independence, and another Socialism, as occurred in Venezuela. The indigenous peoples of Bolivia, who head the majority of citizens of that nation, also began a democratic process of national and socialist liberation.

In the history that emerges, phenomena similar to that of the past arise. To a large extent they are different. One should not classify them in the former categories of “anarchist,” “Indianist,” “revisionist,” or “ultras,” overlooking the rich experiences that surround them and the new paths that they explore.

Many of the movements in Latin America and of the different continents and peripheral and metropolitan regions give crucial importance to the congruence and consequence of thoughts, words, and actions. Observing coherence and consequence allows them to define others and to define themselves. It also helps them escape from the ideological and terminological confusion, to clarify memory, and to undertake the current struggle.

Among the almost universal features that the anti-systemic movements display today it is fundamental to add others, because they give priority to the horizontal organization of “the underdogs.” They are not anarchists. At the same time that they seek to give greater weight to horizontal organizations, they accept that their collectives of defense be hierarchically organized for greater efficacy, as long as they do not exceed the lines and limits of decisions that outline the collectives of the peoples and workers who form a part of them, in other words who always “command obeisance” or who “govern obeying.”

Another promising universal novelty consists of the generalized popular demand for a peaceful struggle that is strengthened by negotiations with respect for the very dignity and autonomy of the negotiators, as well as for the different beliefs and cultures. In them a very firm line is maintained for the struggle of the exploited and oppressed against the system of domination, accumulation, assimilation, mediation, and corruption that today is in a self-destructive crisis and from which they seek emancipation in a movement of negotiated struggles that are growing accumulations and articulations of forces.

The body of emancipating goals and the means to achieve them show an emerging history worldwide that leads to the use of metaphors of the new sciences. On the one hand, formations on different scales appear as “fractals” and resemble each other. On the other, “collectives in communication, information, research, production, distribution, “good government,” culture, celebrations, resistance are organized. As communities and networks of communities, they are capable of spreading to the most distant regions of the countries and Earth as a whole. On the path and in the struggle, they spread the values and interests of a new peaceful revolution—which does not overlook the dangers of violence in history and in “the births of history”—but their attractions and principal values include human emancipation, the defense of the “Good Life,” Peace and Earth.

Pablo Gonzalez Casanova is an award winning author, Professor of Sociology at the Autonomous University of Mexico (UNAM). He is among Latin America’s most distinguished social scientists.

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(3) Bello, Walden. “Manufacturing a Food Crisis”. June 2, 2008, The Nation, http://www.thenation.com/doc/2008602/bello

(4) Grupo Intergubernamental de expertos sobre el Cambio Climático. “Cambio climático 2007: Informe de síntesis” en Cambio Climático 2007

(5) Chalmers, Camilla. “Trayectoria y desafíos hacia una integración alternativa”. Foro Social Mundial, Belem, 2009-04-19

(6) “Declaración de los Movimientos Sociales de Belem”.31 de enero de 2008/ FSM-Belem

(7) Déniz Mayor, J.J. “Contabilidad Nacional, Full Cost Accounting y Resultado Contable Empresarial Ambientalmente sostenible” Cuadernos de Administración, jul-dic.año/vo/l9,No.

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(8) Engadahl, F. William. “Hill Gates, Rockefeller y los gigantes de la biogenética saben algo que ignoramos”, Global Research, 22/12/07

(9) Funtowicz, Silvio O and Jerome E. Ravetz. “The worth of a songbird: ecological economics as a post-normal science”, en Ecological Economics 10,1994, 197-207

(11) “Global Warming Irreversible for 1,000 Years”, 27/01/09

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(20) Solmon Susan et al “Irreversible Climate Change due to Carbon dioxide emissions”. PNAS. 02/10/09. On line.

(21) Ussher, Ismaira Contreras de / Olga Molina de Paredes. “Línea de investigación denominada Las ciencias contables financieras. Su epistemología y aplicabilidad. Tema para la discusión”. Actualidad Contable. Faces. Venezuela, Universidad de los Andes. Enero-junio,2004, 17-34

Fighting Back Against Corporate Personhood

January 27th, 2012

Protestation.org

From: http://www.truth-out.org/bill-moyers-fighting-back/1327630978

by Bill Moyers

Donate to Truthout to receive a copy of “Corporations Are Not People,” [4] by Jeffrey D. Clements. If you believe corporate personhood is a threat to democracy, then this is a must-read book that explains the implications and solutions to reversing corporate governance. Read Bill Moyers’ foreward to “Corporations Are Not People,” [4] below.

Rarely have so few imposed such damage on so many. When five conservative members of the Supreme Court handed for-profit corporations the right to secretly flood political campaigns with tidal waves of cash on the eve of an election, they moved America closer to outright plutocracy, where political power derived from wealth is devoted to the protection of wealth. It is now official: Just as they have adorned our athletic stadiums and multiple places of public assembly with their logos, corporations can officially put their brand on the government of the United States as well as the executive, legislative, and judicial branches of the fifty states.

The decision in Citizens United v. Federal Election Commission giving “artificial entities” the same rights of “free speech” as living, breathing human beings will likely prove as infamous as the Dred Scott ruling of 1857 that opened the unsettled territories of the United States to slavery whether future inhabitants wanted it or not. It took a civil war and another hundred years of enforced segregation and deprivation before the effects of that ruling were finally exorcised from our laws. God spare us civil strife over the pernicious consequences of Citizens United, but unless citizens stand their ground, America will divide even more swiftly into winners and losers with little pity for the latter.

Citizens United is but the latest battle in the class war waged for thirty years from the top down by the corporate and political right. Instead of creating a fair and level playing field for all, government would become the agent of the powerful and privileged. Public institutions, laws, and regulations, as well as the ideas, norms, and beliefs that aimed to protect the common good and helped create America’s iconic middle class, would become increasingly vulnerable. The Nobel Laureate economist Robert Solow succinctly summed up results: “The redistribution of wealth in favor of the wealthy and of power in favor of the powerful.” In the wake of Citizens United, popular resistance is all that can prevent the richest economic interests in the country from buying the democratic process lock, stock, and barrel.

America has a long record of conflict with corporations. Wealth acquired under capitalism is in and of itself no enemy to democracy, but wealth armed with political power—power to choke off opportunities for others to rise, power to subvert public purposes and deny public needs—is a proven danger to the “general welfare” proclaimed in the Preamble to the Constitution as one of the justifications for America’s existence.

In its founding era, Alexander Hamilton created a financial system for our infant republic that mixed subsidies, tariffs, and a central bank to establish a viable economy and sound public credit. James Madison and Thomas Jefferson warned Americans to beware of the political ambitions of that system’s managerial class. Madison feared that the “spirit of speculation” would lead to “a government operating by corrupt influence, substituting the motive of private interest in place of public duty.” Jefferson hoped that “we shall crush in its birth the aristocracy of our monied corporations which dare already to challenge our government to a trial of strength and [to] bid defiance to the laws of our country.” Radical ideas? Class war- fare? The voters didn’t think so. In 1800, they made Jefferson the third president and then reelected him, and in 1808 they put Madison in the White House for the next eight years.

Truthout doesn’t take corporate funding – this lets us do the brave reporting and analysis that makes us unique. Please support this work by making a tax-deductible donation today – click here to donate. [5]

Andrew Jackson, the overwhelming people’s choice of 1828, vetoed the rechartering of the Second Bank of the United States in the summer of 1832. Twenty percent of its stock was government-owned; the rest was held by private investors, some of them foreigners and all of them wealthy. Jackson argued that the bank’s official connections and size gave it unfair advantages over local competition. In his veto message, he said: “[This act] seems to be predicated on the erroneous idea that the present stockholders have a prescriptive right not only to the favor but to the bounty of Government. . . . It is to be regretted that the rich and powerful too often bend the acts of government to their selfish purposes.” Four months later, Jackson was easily reelected in a decisive victory over plutocracy.

The predators roared back in the Gilded Age that followed the Civil War. Corruption born of the lust for money produced what one historian described as “the morals of a gashouse gang.” Judges, state legislators, the parties that selected them and the editors who supported them were purchased as easily as ale at the local pub. Lobbyists roamed the halls of Congress proffering gifts of cash, railroad passes, and fancy entertainments. The U.S. Senate became a “millionaires’ club.” With government on the auction block, the notion of the “general welfare” wound up on the trash heap; grotesque inequality and poverty festered under the gilding. Sound familiar?

Then came a judicial earthquake. In 1886, a conservative Supreme Court conferred the divine gift of life on the Southern Pacific Railroad and by extension to all other corporations. The railroad was declared to be a “person,” protected by the recently enacted Fourteenth Amendment, which said that no person should be deprived of “life, liberty or property without due process of law.” Never mind that the amendment was enacted to protect the rights of freed slaves who were now U.S. citizens. Never mind that a corporation possessed neither a body to be kicked nor a soul to be damned (or saved!). The Court decided that it had the same rights of “personhood” as a walking, talking citizen and was entitled to enjoy every liberty protected by the Constitution that flesh-and-blood individuals could claim, even though it did not share their disadvantage of being mortal. It could move where it chose, buy any kind of property it chose, and select its directors and stockholders from anywhere it chose. Welcome to unregulated multinational conglomerates, although unforeseen at the time. Welcome to tax shelters, at home and offshore, and to subsidies galore, paid for by the taxes of unsuspecting working people. Corporations were endowed with the rights of “personhood” but exempted from the responsibilities of citizenship.

That’s the doctrine picked up and dusted off by the John Roberts Court in its ruling on Citizens United. Ignoring a century of modifying precedent, the court gave our corporate sovereigns a “sky’s the limit” right to pour money into political campaigns for the purpose of influencing the outcome. And to do so without public disclosure. We might as well say farewell to the very idea of fair play. Farewell, too, to representative government “of, by, and for the people.”
Unless.

Unless “We, the People”—flesh-and-blood humans, outraged at the selling off of our government—fight back.
It’s been done before. As my friend and longtime colleague, the historian Bernard Weisberger, wrote recently, the Supreme Court remained a procorporate conservative fortress for the next fifty years after the Southern Pacific decision. Decade after decade it struck down laws aimed to share power with the citizenry and to promote “the general welfare.” In 1895, it declared unconstitutional a measure providing for an income tax and gutted the Sherman Antitrust Act by finding a loophole for a sugar trust. In 1905, it killed a New York state law limiting working hours. In 1917, it did likewise to a prohibition against child labor. In 1923, it wiped out another law that set minimum wages for women. In 1935 and 1936, it struck down early New Deal recovery acts.

But in the face of such discouragement, embattled citizens refused to give up. Into their hearts, wrote the progressive Kansas journalist William Allen White, “had come a sense that their civilization needed recasting, that the government had fallen into the hands of self-seekers, that a new relationship should be established between the haves and the have-nots.” Not content merely to wring their hands and cry “Woe is us,” everyday citizens researched the issues, organized public events to educate their neighbors, held rallies, made speeches, petitioned and canvassed, marched and exhorted. They would elect the twentieth-century governments that restored “the general welfare” as a pillar of American democracy, setting in place legally ordained minimum wages, maximum working hours, child labor laws, workmen’s safety and compensation laws, pure foods and safe drugs, Social Security and Medicare, and rules to promote competitive rather than monopolistic financial and business markets.

The social contract that emerged from these victories is part and parcel of the “general welfare” to which the Founders had dedicated our Constitution. The corporate and political right seeks now to weaken and ultimately destroy it. Thanks to their ideological kin on the Supreme Court, they can attack the social contract using their abundant resources of wealth funneled— clandestinely—into political campaigns. During the fall elections of 2010, the first after the Citizens United decision, corporate front groups spent $126 million while hiding the identities of the donors, according to the Sunlight Foundation. The United States Chamber of Commerce, which touts itself as a “main street” grass- roots organization, draws most of its funds from about a hundred businesses, including such “main street” sources as BP, Exxon- Mobil, JPMorgan Chase, Massey Coal, Pfizer, Shell, Aetna, and Alcoa. The ink was hardly dry on the Citizens United decision when the Chamber organized a covertly funded front and fired volley after volley of missiles, in the form of political ads, into the 2010 campaigns, eventually spending approximately $75 million. Another corporate cover group—the Americans Action Net- work—spent over $26 million of undisclosed corporate money in six Senate races and 28 House of Representative elections. And “Crossroads GPS” seized on Citizens United to raise and spend at least $17 million that NBC News said came from “a small circle of extremely wealthy Wall Street hedge fund and private equity moguls,” all determined to water down the financial reforms designed to avoid a collapse of the financial system that their own greed and reckless speculation had helped bring on. As I write in the summer of 2011, the New York Times reports that efforts to thwart serious reforms are succeeding. The populist editor Jim Hightower concludes that today’s proponents of corporate plutocracy “have simply elevated money itself above votes, establishing cold, hard cash as the real coin of political power. The more you spend on politics, the bigger your voice is in government, making the vast vaults of billionaires and corporations far superior to the voices of mere voters.”

Against such odds, discouragement comes easily. But if the generations before us had given up, slaves would be waiting on our tables and picking our crops, women would be turned back at the voting booths, and it would be a crime for workers to organize. Like our forebears, we will not fix the broken promise of America—the promise of “life, liberty, and the pursuit of happiness” for all our citizens, not just the powerful and privileged—if we throw in the proverbial towel. Surrendering to plutocracy is not an option. Confronting a moment in our history that is much like the one Lincoln faced—when “we can nobly save or meanly lose the last best hope on earth”—we must fight back against the forces that are pouring dirty money into the political system, turning it into a sewer.

How to fight back is the message of this book. Jeffrey Clements saw corporate behavior up close during two stints as assistant attorney general in Massachusetts, litigating against the tobacco industry, enforcing fair trade practices, and leading more than one hundred attorneys and staff responsible for consumer and environmental protection, antitrust practices, and the oversight of health care, insurance, and financial services. He came away from the experience repeating to himself this indelible truth: “Corporations are not people.” Try it yourself: “Corporations are not people.” Again: “Corporations are not people.” You are now ready to join what Clements believes is the most promising way to counter Citizens United: a campaign for a constitutional amendment affirming that free speech and democracy are for people and that corporations are not people. Impossible? Not at all, says Clements. We have already amended the Constitution twenty-seven times. Amendment campaigns are how we have always made the promise of equality and liberty more real. Difficult? Of course; as Frederick Douglass taught us, power concedes nothing without a struggle. To contend with power, Clements and his colleague John Bonifaz founded Free Speech for People, a nationwide nonpartisan effort to overturn Citizens United and corporate rights doctrines that unduly leverage corporate economic power into political power. What Clements calls the People’s Rights Amendment could be our best hope to save the “great American experiment.”

To find out why, read on, and as you read, keep in mind the words of Theodore Roosevelt, a Republican, who a century ago stood up to the mighty combines of wealth and power that were buying up our government and called on Americans of all persuasions to join him in opposing the “naked robbery” of the public’s trust:

It is not a partisan issue; it is more than a political issue; it is a great moral issue. If we condone political theft, if we do not resent the kinds of wrong and injustice that injuriously affect the whole nation, not merely our democratic form of government but our civilization itself cannot endure.

Banks Weren’t Meant to Be Like This

January 27th, 2012

Protestation.org

From: http://www.counterpunch.org/2012/01/27/banks-werent-meant-to-be-like-this/

by Michael Hudson

In medieval times, wealthy bankers lent to kings and princes as their major customers. But now it is the banks that are needy, relying on governments for funding – capped by the post-2008 bailouts to save them from going bankrupt from their bad private-sector loans and gambles.

Yet the banks now browbeat governments – not by having ready cash but by threatening to go bust and drag the economy down with them if they are not given control of public tax policy, spending and planning. The process has gone furthest in the United States. Joseph Stiglitz characterizes the Obama administration’s vast transfer of money and pubic debt to the banks as a “privatizing of gains and the socializing of losses. It is a ‘partnership’ in which one partner robs the other.” Prof. Bill Black describes banks as becoming criminogenic and innovating “control fraud.” High finance has corrupted regulatory agencies, falsified account-keeping by “mark to model” trickery, and financed the campaigns of its supporters to disable public oversight. The effect is to leave banks in control of how the economy’s allocates its credit and resources.

If there is any silver lining to today’s debt crisis, it is that the present situation and trends cannot continue. So this is not only an opportunity to restructure banking; we have little choice. The urgent issue is who will control the economy: governments, or the financial sector and monopolies with which it has made an alliance.

Fortunately, it is not necessary to re-invent the wheel. Already a century ago the outlines of a productive industrial banking system were well understood. But recent bank lobbying has been remarkably successful in distracting attention away from classical analyses of how to shape the financial and tax system to best promote economic growth – by public checks on bank privileges.

How banks broke the social compact, promoting their own special interests

People used to know what banks did. Bankers took deposits and lent them out, paying short-term depositors less than they charged for risky or less liquid loans. The risk was borne by bankers, not depositors or the government. But today, bank loans are made increasingly to speculators in recklessly large amounts for quick in-and-out trading. Financial crashes have become deeper and affect a wider swath of the population as debt pyramiding has soared and credit quality plunged into the toxic category of “liars’ loans.”

The first step toward today’s mutual interdependence between high finance and government was for central banks to act as lenders of last resort to mitigate the liquidity crises that periodically resulted from the banks’ privilege of credit creation. In due course governments also provided public deposit insurance, recognizing the need to mobilize and recycle savings into capital investment as the industrial revolution gained momentum. In exchange for this support, they regulated banks as public utilities.

Over time, banks have sought to disable this regulatory oversight, even to the point of decriminalizing fraud. Sponsoring an ideological attack on government, they accuse public bureaucracies of “distorting” free markets (by which they mean markets free for predatory behavior). The financial sector is now making its move to concentrate planning in its own hands.

The problem is that the financial time frame is notoriously short-term and often self-destructive. And inasmuch as the banking system’s product is debt, its business plan tends to be extractive and predatory, leaving economies high-cost. This is why checks and balances are needed, along with regulatory oversight to ensure fair dealing. Dismantling public attempts to steer banking to promote economic growth (rather than merely to make bankers rich) has permitted banks to turn into something nobody anticipated. Their major customers are other financial institutions, insurance and real estate – the FIRE sector, not industrial firms. Debt leveraging by real estate and monopolies, arbitrage speculators, hedge funds and corporate raiders inflates asset prices on credit. The effect of creating “balance sheet wealth” in this way is to load down the “real” production-and-consumption economy with debt and related rentier charges, adding more to the cost of living and doing business than rising productivity reduces production costs.

Since 2008, public bailouts have taken bad loans off the banks’ balance sheet at enormous taxpayer expense – some $13 trillion in the United States, and proportionally higher in Ireland and other economies now being subjected to austerity to pay for “free market” deregulation. Bankers are holding economies hostage, threatening a monetary crash if they do not get more bailouts and nearly free central bank credit, and more mortgage and other loan guarantees for their casino-like game. The resulting “too big to fail” policy means making governments too weak to fight back.

The process that began with central bank support thus has turned into broad government guarantees against bank insolvency. The largest banks have made so many reckless loans that they have become wards of the state. Yet they have become powerful enough to capture lawmakers to act as their facilitators. The popular media and even academic economic theorists have been mobilized to pose as experts in an attempt to convince the public that financial policy is best left to technocrats – of the banks’ own choosing, as if there is no alternative policy but for governments to subsidize a financial free lunch and crown bankers as society’s rulers.

The Bubble Economy and its austerity aftermath could not have occurred without the banking sector’s success in weakening public regulation, capturing national treasuries and even disabling law enforcement. Must governments surrender to this power grab? If not, who should bear the losses run up by a financial system that has become dysfunctional? If taxpayers have to pay, their economy will become high-cost and uncompetitive – and a financial oligarchy will rule.

The present debt quandary

The endgame in times past was to write down bad debts. That meant losses for banks and investors. But today’s debt overhead is being kept in place – shifting bad loans off bank balance sheets to become public debts owed by taxpayers to save banks and their creditors from loss. Governments have given banks newly minted bonds or central bank credit in exchange for junk mortgages and bad gambles – without re-structuring the financial system to create a more stable, less debt-ridden economy. The pretense is that these bailouts will enable banks to lend enough to revive the economy by enough to pay its debts.

Seeing the handwriting on the wall, bankers are taking as much bailout money as they can get, and running, using the money to buy as much tangible property and ownership rights as they can while their lobbyists keep the public subsidy faucet running.

The pretense is that debt-strapped economies can resume business-as-usual growth by borrowing their way out of debt. But a quarter of U.S. real estate already is in negative equity – worth less than the mortgages attached to it – and the property market is still shrinking, so banks are not lending except with public Federal Housing Administration guarantees to cover whatever losses they may suffer. In any event, it already is mathematically impossible to carry today’s debt overhead without imposing austerity, debt deflation and depression.

This is not how banking was supposed to evolve. If governments are to underwrite bank loans, they may as well be doing the lending in the first place – and receiving the gains. Indeed, since 2008 the over-indebted economy’s crash led governments to become the major shareholders of the largest and most troubled banks – Citibank in the United States, Anglo-Irish Bank in Ireland, and Britain’s Royal Bank of Scotland. Yet rather than taking this opportunity to run these banks as public utilities and lower their charges for credit-card services – or most important of all, to stop their lending to speculators and gamblers – governments left these banks operating as part of the “casino capitalism” that has become their business plan.

There is no natural reason for matters to be like this. Relations between banks and government used to be the reverse. In 1307, France’s Philip IV (“The Fair”) set the tone by seizing the Knights Templars’ wealth, arresting them and putting many to death – not on financial charges, but on the accusation of devil-worshipping and satanic sexual practices. In 1344 the Peruzzi bank went broke, followed by the Bardi by making unsecured loans to Edward III of England and other monarchs who died or defaulted. Many subsequent banks had to suffer losses on loans gone bad to real estate or financial speculators.

By contrast, now the U.S., British, Irish and Latvian governments have taken bad bank loans onto their national balance sheets, imposing a heavy burden on taxpayers – while letting bankers cash out with immense wealth. These “cash for trash” swaps have turned the mortgage crisis and general debt collapse into a fiscal problem. Shifting the new public bailout debts onto the non-financial economy threaten to increase the cost of living and doing business. This is the result of the economy’s failure to distinguish productive from unproductive loans and debts. It helps explain why nations now are facing financial austerity and debt peonage instead of the leisure economy promised so eagerly by technological optimists a century ago.

So we are brought back to the question of what the proper role of banks should be. This issue was discussed exhaustively prior to World War I. It is even more urgent today.

How classical economists hoped to modernize banks as agents of industrial capitalism

Britain was the home of the Industrial Revolution, but there was little long-term lending to finance investment in factories or other means of production. British and Dutch merchant banking was to extend short-term credit on the basis of collateral such as real property or sales contracts for merchandise shipped (“receivables”). Buoyed by this trade financing, merchant bankers were successful enough to maintain long-established short-term funding practices. This meant that James Watt and other innovators were obliged to raise investment money from their families and friends rather than from banks.

It was the French and Germans who moved banking into the industrial stage to help their nations catch up. In France, the Saint-Simonians described the need to create an industrial credit system aimed at funding means of production. In effect, the Saint-Simonians proposed to restructure banks along lines akin to a mutual fund. A start was made with the Crédit Mobilier, founded by the Péreire Brothers in 1852. Their aim was to shift the banking and financial system away from debt financing at interest toward equity lending, taking returns in the form of dividends that would rise or decline in keeping with the debtor’s business fortunes. By giving businesses leeway to cut back dividends when sales and profits decline, profit-sharing agreements avoid the problem that interest must be paid willy-nilly. If an interest payment is missed, the debtor may be forced into bankruptcy and creditors can foreclose. It was to avoid this favoritism for creditors regardless of the debtor’s ability to pay that prompted Mohammed to ban interest under Islamic law.

Attracting reformers ranging from socialists to investment bankers, the Saint-Simonians won government backing for their policies under France’s Third Empire. Their approach inspired Marx as well as industrialists in Germany and protectionists in the United States and England. The common denominator of this broad spectrum was recognition that an efficient banking system was needed to finance the industry on which a strong national state and military power depended.

Germany develops an industrial banking system

It was above all in Germany that long-term financing found its expression in the Reichsbank and other large industrial banks as part of the “holy trinity” of banking, industry and government planning under Bismarck’s “state socialism.” German banks made a virtue of necessity. British banks “derived the greater part of their funds from the depositors,” and steered these savings and business deposits into mercantile trade financing. This forced domestic firms to finance most new investment out of their own earnings. By contrast, Germany’s “lack of capital … forced industry to turn to the banks for assistance,” noted the financial historian George Edwards. “A considerable proportion of the funds of the German banks came not from the deposits of customers but from the capital subscribed by the proprietors themselves. As a result, German banks “stressed investment operations and were formed not so much for receiving deposits and granting loans but rather for supplying the investment requirements of industry.”

When the Great War broke out in 1914, Germany’s rapid victories were widely viewed as reflecting the superior efficiency of its financial system. To some observers the war appeared as a struggle between rival forms of financial organization. At issue was not only who would rule Europe, but whether the continent would have laissez faire or a more state-socialist economy.

In 1915, shortly after fighting broke out, the Christian Socialist priest-politician Friedrich Naumann published Mitteleuropa, describing how Germany recognized more than any other nation that industrial technology needed long‑term financing and government support. His book inspired Prof. H. S. Foxwell in England to draw on his arguments in two remarkable essays published in the Economic Journal in September and December 1917: “The Nature of the Industrial Struggle,” and “The Financing of Industry and Trade.” He endorsed Naumann’s contention that “the old individualistic capitalism, of what he calls the English type, is giving way to the new, more impersonal, group form; to the disciplined scientific capitalism he claims as German.”

This was necessarily a group undertaking, with the emerging tripartite integration of industry, banking and government, with finance being “undoubtedly the main cause of the success of modern German enterprise,” Foxwell concluded (p. 514). German bank staffs included industrial experts who were forging industrial policy into a science. And in America, Thorstein Veblen’s The Engineers and the Price System (1921) voiced the new industrial philosophy calling for bankers and government planners to become engineers in shaping credit markets.

Foxwell warned that British steel, automotive, capital equipment and other heavy industry was becoming obsolete largely because its bankers failed to perceive the need to promote equity investment and extend long‑term credit. They based their loan decisions not on the new production and revenue their lending might create, but simply on what collateral they could liquidate in the event of default: inventories of unsold goods, real estate, and money due on bills for goods sold and awaiting payment from customers. And rather than investing in the shares of the companies that their loans supposedly were building up, they paid out most of their earnings as dividends – and urged companies to do the same. This short time horizon forced business to remain liquid rather than having leeway to pursue long‑term strategy.

German banks, by contrast, paid out dividends (and expected such dividends from their clients) at only half the rate of British banks, choosing to retain earnings as capital reserves and invest them largely in the stocks of their industrial clients. Viewing these companies as allies rather than merely as customers from whom to make as large a profit as quickly as possible, German bank officials sat on their boards, and helped expand their business by extending loans to foreign governments on condition that their clients be named the chief suppliers in major public investments. Germany viewed the laws of history as favoring national planning to organize the financing of heavy industry, and gave its bankers a voice in formulating international diplomacy, making them “the principal instrument in the extension of her foreign trade and political power.”

A similar contrast existed in the stock market. British brokers were no more up to the task of financing manufacturing in its early stages than were its banks. The nation had taken an early lead by forming Crown corporations such as the East India Company, the Bank of England and even the South Sea Company. Despite the collapse of the South Sea Bubble in 1720, the run-up of share prices from 1715 to 1720 in these joint-stock monopolies established London’s stock market as a popular investment vehicle, for Dutch and other foreigners as well as for British investors. But the market was dominated by railroads, canals and large public utilities. Industrial firms were not major issuers of stock.

In any case, after earning their commissions on one issue, British stockbrokers were notorious for moving on to the next without much concern for what happened to the investors who had bought the earlier securities. “As soon as he has contrived to get his issue quoted at a premium and his underwriters have unloaded at a profit,” complained Foxwell, “his enterprise ceases. ‘To him,’ as the Times says, ‘a successful flotation is of more importance than a sound venture.’”

Much the same was true in the United States. Its merchant heroes were individualistic traders and political insiders often operating on the edge of the law to gain their fortunes by stock-market manipulation, railroad politicking for land giveaways, and insurance companies, mining and natural resource extraction. America’s wealth-seeking spirit found its epitome in Thomas Edison’s hit-or-miss method of invention, coupled with a high degree of litigiousness to obtain patent and monopoly rights.

In sum, neither British nor American banking or stock markets planned for the future. Their time frame was short, and they preferred rent-extracting projects to industrial innovation. Most banks favored large real estate borrowers, railroads and public utilities whose income streams easily could be forecast. Only after manufacturing companies grew fairly large did they obtain significant bank and stock market credit.

What is remarkable is that this is the tradition of banking and high finance that has emerged victorious throughout the world. The explanation is primarily the military victory of the United States, Britain and their Allies in the Great War and a generation later, in World War II.

The regression toward burdensome unproductive debts after World War I

The development of industrial credit led economists to distinguish between productive and unproductive lending. A productive loan provides borrowers with resources to trade or invest at a profit sufficient to pay back the loan and its interest charge. An unproductive loan must be paid out of income earned elsewhere. Governments must pay war loans out of tax revenues. Consumers must pay loans out of income they earn at a job – or by selling assets. These debt payments divert revenue away from being spent on consumption and investment, so the economy shrinks. This traditionally has led to crises that wipe out debts, above all those that are unproductive.

In the aftermath of World War I the economies of Europe’s victorious and defeated nations alike were dominated by postwar arms and reparations debts. These inter-governmental debts were to pay for weapons (by the Allies when the United States unexpectedly demanded that they pay for the arms they had bought before America’s entry into the war), and for the destruction of property (by the Axis), not new means of production. Yet to the extent that they were inter-governmental, these debts were more intractable than debts to private bankers and bondholders. Despite the fact that governments in principle are sovereign and hence can annul debts owed to private creditors, the defeated Axis governments were in no position to do this.

And among the Allies, Britain led the capitulation to U.S. arms billing, captive to the creditor ideology that “a debt is a debt” and must be paid regardless of what this entails in practice or even whether the debt in fact can be paid. Confronted with America’s demand for payment, the Allies turned to Germany to make them whole. After taking its liquid assets and major natural resources, they insisted that it squeeze out payments by taxing its economy. No attempt was made to calculate just how Germany was to do this – or most important, how it was to convert this domestic revenue (the “budgetary problem”) into hard currency or gold. Despite the fact that banking had focused on international credit and currency transfers since the 12^th century, there was a broad denial of what John Maynard Keynes identified as a foreign exchange transfer problem.

Never before had there been an obligation of such enormous magnitude. Nevertheless, all of Germany’s political parties and government agencies sought to devise ways to tax the economy to raise the sums being demanded. Taxes, however, are levied in a nation’s own currency. The only way to pay the Allies was for the Reichsbank to take this fiscal revenue and throw it onto the foreign exchange markets to obtain the sterling and other hard currency to pay. Britain, France and the other recipients then paid this money on their Inter-Ally debts to the United States.

Adam Smith pointed out that no government ever had paid down its public debt. But creditors always have been reluctant to acknowledge that debtors are unable to pay. Ever since David Ricardo’s lobbying for their perspective in Britain’s Bullion debates, creditors have found it their self-interest to promote a doctrinaire blind spot, insisting that debts of any magnitude can and should be paid. They resist acknowledging a distinction between raising funds domestically (by running a budget surplus) and obtaining the foreign exchange to pay foreign-currency debt. Furthermore, despite the evident fact that austerity cutbacks on consumption and investment can only be extractive, creditor-oriented economists refused to recognize that debts cannot be paid by shrinking the economy. Or that foreign debts and other international payments cannot be paid in domestic currency without lowering the exchange rate.

The more domestic currency Germany sought to convert, the further its exchange rate was driven down against the dollar and other gold-based currencies. This obliged Germans to pay much more for imports. The collapse of the exchange rate was the source of hyperinflation, not an increase in domestic money creation as today’s creditor-sponsored monetarist economists insist. In vain Keynes pointed to the specific structure of Germany’s balance of payments and asked creditors to specify just how many German exports they were willing to take, and to explain how domestic currency could be converted into foreign exchange without collapsing the exchange rate and causing price inflation.

Tragically, Ricardian tunnel vision won Allied government backing. Bertil Ohlin and Jacques Rueff claimed that economies receiving German payments would recycle their inflows to Germany and other debt-paying countries by buying their imports. If income adjustments did not keep exchange rates and prices stable, then Germany’s falling exchange rate would make its exports sufficiently more attractive to enable it to earn the revenue to pay.

This is the logic that the International Monetary Fund followed half a century later in insisting that Third World countries remit foreign earnings and even permit flight capital as well as pay their foreign debts. It is the neoliberal stance now demanding austerity for Greece, Ireland, Italy and other Eurozone economies.

Bank lobbyists claim that the European Central Bank will risk spurring domestic wage and price inflation if it does what central banks were founded to do: finance budget deficits. Europe’s financial institutions are given a monopoly right to perform this electronic task – and to receive interest for what a real central bank could create on its own computer keyboard.

But why it is less inflationary for commercial banks to finance budget deficits than for central banks to do this? The bank lending that has inflated a global financial bubble since the 1980s has left as its legacy a debt overhead that can no more be supported today than Germany was able to carry its reparations debt in the 1920s. Would government credit have so recklessly inflated asset prices?

How debt creation has fueled asset-price inflation since the 1980s

Banking in recent decades has not followed the productive lines that early economic futurists expected. As noted above, instead of financing tangible investment to expand production and innovation, most loans are made against collateral, with interest to be paid out of what borrowers can make elsewhere. Despite being unproductive in the classical sense, it was remunerative for debtors from 1980 until 2008 – not by investing the loan proceeds to expand economic activity, but by riding the wave of asset-price inflation. Mortgage credit enabled borrowers to bid up property prices, drawing speculators and new customers into the market in the expectation that prices would continue to rise. But hothouse credit infusions meant additional debt service, which ended up shrinking the market for goods and services.

Under normal conditions the effect would have been for rents to decline, with property prices following suit, leading to mortgage defaults. But banks postponed the collapse into negative equity by lowering their lending standards, providing enough new credit to keep on inflating prices. This averted a collapse of their speculative mortgage and stock market lending. It was inflationary – but it was inflating asset prices, not commodity prices or wages. Two decades of asset price inflation enabled speculators, homeowners and commercial investors to borrow the interest falling due and still make a capital gain.

This hope for a price gain made winning bidders willing to pay lenders all the current income – making banks the ultimate and major rentier income recipients. The process of inflating asset prices by easing credit terms and lowering the interest rate was self-feeding. But it also was self-terminating, because raising the multiple by which a given real estate rent or business income can be “capitalized” into bank loans increased the economy’s debt overhead.

Securities markets became part of this problem. Rising stock and bond prices made pension funds pay more to purchase a retirement income – so “pension fund capitalism” was coming undone. So was the industrial economy itself. Instead of raising new equity financing for companies, the stock market became a vehicle for corporate buyouts. Raiders borrowed to buy out stockholders, loading down companies with debt. The most successful looters left them bankrupt shells. And when creditors turned their economic gains from this process into political power to shift the tax burden onto wage earners and industry, this raised the cost of living and doing business – by more than technology was able to lower prices.

The EU rejects central bank money creation, leaving deficit financing to the banks

Article 123 of the Lisbon Treaty forbids the ECB or other central banks to lend to government. But central banks were created specifically – to finance government deficits. The EU has rolled back history to the way things were three hundred years ago, before the Bank of England was created. Reserving the task of credit creation for commercial banks, it leaves governments without a central bank to finance the public spending needed to avert depression and widespread financial collapse.

So the plan has backfired. When “hard money” policy makers limited central bank power, they assumed that public debts would be risk-free. Obliging budget deficits to be financed by private creditors seemed to offer a bonanza: being able to collect interest for creating electronic credit that governments can create themselves. But now, European governments need credit to balance their budget or face default. So banks now want a central bank to create the money to bail them out for the bad loans they have made.

For starters, the ECB’s €489 billion in three-year loans at 1% interest gives banks a free lunch arbitrage opportunity (the “carry trade”) to buy Greek and Spanish bonds yielding a higher rate. The policy of buying government bonds in the open market – after banks first have bought them at a lower issue price – gives the banks a quick and easy trading gain.

How are these giveaways less inflationary than for central banks to directly finance budget deficits and roll over government debts? Is the aim of giving banks easy gains simply to provide them with resources to resume the Bubble Economy lending that led to today’s debt overhead in the first place?

Conclusion

Governments can create new credit electronically on their own computer keyboards as easily as commercial banks can. And unlike banks, their spending is expected to serve a broad social purpose, to be determined democratically. When commercial banks gain policy control over governments and central banks, they tend to support their own remunerative policy of creating asset-inflationary credit – leaving the clean-up costs to be solved by a post-bubble austerity. This makes the debt overhead even harder to pay – indeed, impossible.

So we are brought back to the policy issue of how public money creation to finance budget deficits differs from issuing government bonds for banks to buy. Is not the latter option a convoluted way to finance such deficits – at a needless interest charge? When governments monetize their budget deficits, they do not have to pay bondholders.

I have heard bankers argue that governments need an honest broker to decide whether a loan or public spending policy is responsible. To date their advice has not promoted productive credit. Yet they now are attempting to compensate for the financial crisis by telling debtor governments to sell off property in their public domain. This “solution” relies on the myth that privatization is more efficient and will lower the cost of basic infrastructure services. Yet it involves paying interest to the buyers of rent-extraction rights, higher executive salaries, stock options and other financial fees.

Most cost savings are achieved by shifting to non-unionized labor, and typically end up being paid to the privatizers, their bankers and bondholders, not passed on to the public. And bankers back price deregulation, enabling privatizers to raise access charges. This makes the economy higher cost and hence less competitive – just the opposite of what is promised.

Banking has moved so far away from funding industrial growth and economic development that it now benefits primarily at the economy’s expense in a predator and extractive way, not by making productive loans. This is now the great problem confronting our time. Banks now lend mainly to other financial institutions, hedge funds, corporate raiders, insurance companies and real estate, and engage in their own speculation in foreign currency, interest-rate arbitrage, and computer-driven trading programs. Industrial firms bypass the banking system by financing new capital investment out of their own retained earnings, and meet their liquidity needs by issuing their own commercial paper directly. Yet to keep the bank casino winning, global bankers now want governments not only to bail them out but to enable them to renew their failed business plan – and to keep the present debts in place so that creditors will not have to take a loss.

This wish means that society should lose, and even suffer depression. We are dealing here not only with greed, but with outright antisocial behavior and hostility.

Europe thus has reached a critical point in having to decide whose interest to put first: that of banks, or the “real” economy. History provides a wealth of examples illustrating the dangers of capitulating to bankers, and also for how to restructure banking along more productive lines. The underlying questions are clear enough:

* Have banks outlived their historical role, or can they be restructured to finance productive capital investment rather than simply inflate asset prices?

* Would a public option provide less costly and better directed credit?

* Why not promote economic recovery by writing down debts to reflect the ability to pay, rather than relinquishing more wealth to an increasingly aggressive creditor class?

Solving the Eurozone’s financial problem can be made much easier by the tax reforms that classical economists advocated to complement their financial reforms. To free consumers and employers from taxation, they proposed to levy the burden on the “unearned increment” of land and natural resource rent, monopoly rent and financial privilege. The guiding principle was that property rights in the earth, monopolies and other ownership privileges have no direct cost of production, and hence can be taxed without reducing their supply or raising their price, which is set in the market. Removing the tax deductibility for interest is the other key reform that is needed.

A rent tax holds down housing prices and those of basic infrastructure services, whose untaxed revenue tends to be capitalized into bank loans and paid out in the form of interest charges. Additionally, land and natural resource rents – along with interest – are the easiest to tax, because they are highly visible and their value is easy to assess.

Pressure to narrow existing budget deficits offers a timely opportunity to rationalize the tax systems of Greece and other PIIGS countries in which the wealthy avoid paying their fair share of taxes. The political problem blocking this classical fiscal policy is that it “interferes” with the rent-extracting free lunches that banks seek to lend against. So they act as lobbyists for untaxing real estate and monopolies (and themselves as well). Despite the financial sector’s desire to see governments remain sufficiently solvent to pay bondholders, it has subsidized an enormous public relations apparatus and academic junk economics to oppose the tax policies that can close the fiscal gap in the fairest way.

It is too early to forecast whether banks or governments will emerge victorious from today’s crisis. As economies polarize between debtors and creditors, planning is shifting out of public hands into those of bankers. The easiest way for them to keep this power is to block a true central bank or strong public sector from interfering with their monopoly of credit creation. The counter is for central banks and governments to act as they were intended to, by providing a public option for credit creation.

This article also appears in the Frankfurter Algemeine Zeitung.

MICHAEL HUDSON is a former Wall Street economist. A Distinguished Research Professor at University of Missouri, Kansas City (UMKC), he is the author of many books, including Super Imperialism: The Economic Strategy of American Empire (new ed., Pluto Press, 2002) and Trade, Development and Foreign Debt: A History of Theories of Polarization v. Convergence in the World Economy. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion, forthcoming from AK Press. He can be reached via his website, mh@michael-hudson.com

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