This important vote could come up this week; possibly next week… Act today.
Insist on a response in writing.
Call 800-517-5696 today to protest more war funding!
Do you want the United States government to spend tens of billions of dollars more to fund the war in Iraq and expand the war in Afghanistan?
Next week, your representative will be asked to vote on a war supplemental bill that would do just that.
Call toll-free on May 12
800-517-5696
Say no to more spending on two wars. Urge your representative to use our tax dollars to
bring the troops home
take care of them upon their return
rebuild Iraq and Afghanistan
take care of health, education, and energy here at home
Oppose more war funding.
The U.S. government already spends $1.9 million every minute on the military — and that doesn't include funding for the wars in Iraq and Afghanistan.
This is the position of our Organizing Council:
All of this money could be going towards the creation of a public health care system. Any country that can spend this kind of money on wars and militarism that includes funding over 800 U.S. foreign military bases dotting the globe; subsidizing the Israeli killing machine; and fighting wars in three countries at the same time certainly can afford to provide its own people a first-rate, world-class public health care system that is comprehensive, all-inclusive and universal which is publicly funded, publicly administered and publicly delivered. Everyone in. All the profiteers out. Health care for people not for profit.
As a working class mother I did not raise my children to go fight wars and kill other people so oil companies can profit.
I voted for Barack Obama very reluctantly and this war funding is not the change I voted for.
Please call today.
Call 800-517-5696 today to protest more war funding!
Maggie Bird
President,
Midwest Casino Workers Organizing Council
Two-million casino workers employed in the Indian Gaming Industry go to jobs in smoke-filled casinos getting poverty wages without any rights under state, federal or tribal labor laws.
The same government funding these wars created this injustice in the Indian Gaming Industry and refuses to right this wrong.
Distributed by:
Alan L. Maki
Director of Organizing,
Midwest Casino Organizing Council
58891 County Road 13
Warroad, Minnesota 56763
Phone: 218-386-2432
Cell phone: 651-587-5541
E-mail: amaki000@centurytel.net
Check out my blog:
Thoughts From Podunk
http://thepodunkblog.blogspot.com/
Tuesday, May 12, 2009
Tuesday, April 21, 2009
Teabaggers and Bigots
This is probably the most straight forward piece I have seen about these teabaggers.
Benny
This post by right-wing bigot Nancy L. LaRoche to the "e-democracy forum" pretty much tells us the truth behind all the statements coming from the two-bit, half-assed fascist right-wing talk radio big-mouths who host these programs that somehow these teabaggers are putting on some kind of "non-partisan" events open to all who decry wasteful government spending.
Check out this response to me very closely because the truth is in what Nancy L. LaRoche posted in opposition to what I posted.
Here is what I posted which she is responding to:
Now, notice what she says:
This is a very frank admission that only those from the right side of the political spectrum are welcome at these "Tea Parties."
This statement here makes Mitch Berg, Chris Baker, Shawn Hannity, Rush Limbaugh and the rest of the chicken shit patriot crowd so eager to send others off to kill and die in these dirty imperialist wars being waged for control of the oil fields and gas pipeline routes along with regional domination and control of the poppy and heroin trade nothing but outright liars afraid to defend their fascist, racist, warmongering, pro-capitalist, pro-imperialist ideas. They lie when they say these "Tea Parties" were organized by "concerned citizens" from grassroots, when, in fact, these right-wing bigots and blowhards of talk radio have organized these "Tea Parties" for two reasons: 1.) As promotional publicity stunts to promote the now largely discredited right-wing talk radio; and, 2.) To try to move the country firther to the right THAN WHAT BARACK OBAMA, THE DEMOCRATS AND THE WALL STREET CROWD are already trying to take us. Make no mistake, Barack Obama is not liberal, progressive or left in any sense of the meaning of these words... Obama is definitely not a "socialist" as these racist, bigots of right-wing talk radio of are charging.
In other words, the teabaggers are not going to allow me (or any known "leftist" to address their Tax Day Rallies with the message that military spending is wasteful government spending.
The organizers of these "Tea Parties" do not want people hearing the truth that the most excessive, wasteful government spending is for wars and militarism.
These right-wing blow-hards like Mitch Berg are afraid to have me addressing their crowds saying things like:
Now, this self-avowed, Bircher--- this two-bit, half-assed fascist--- Nancy L. LaRoche declares that I have denied people with differing viewpoints from my own the right to speak at anti-war rallies.
This is another outright and brazen two-faced lie and she is well aware she is a liar in making this statement.
I have never in my life prevented anyone--- from any political perspective or persuasion--- with an anti-war view to speak at any anti-war rally.
To the extent it has been within my power (as one vote on a committee), I have never allowed anyone with a pro-war view to speak at an anti-war rally.
Why would I give consideration to anyone with a pro-war view to speak at an "anti-war rally?" Only a complete idiot and fool like this Birchite, Nancy L. LaRoche, would make such a statement... it is up to her and her warmongering friends who support these wars but never go off to fight them to organize their own "pro-war rallies."
However, I have organized (and participated as a debater in debates I had no part in organizing) dozens of debates all over Minnesota--- some ninety debates, in fact--- prior to the start of the war in Iraq, around the question and issue:
Participants in these debates, generally consisted of two or three pro and con views. As the main organizer of these debates across Minnesota I did not seek out and select participants according to my personal left-wing views. In fact, these debates included retired military people--- both pro and con--- on the question and the issue. In fact, there were even some right-wing talk show hosts who participated in these debates--- several times as the moderators. Not once was I ever accused of stacking these debates. And not once was the discourse anything but cordial. I would note, the bigots and the Birchites did condemn these debates because they included the anti-war view! You see, these two-bit, half-assed fascists do not believe in democracy or any concept of democracy. To them, democracy is only them getting out their views. These is an obviously perverted view of democracy; the same perverted view of democracy that almost thoroughly permeates right-wing talk radio--- with a very few notable exceptions of those who hold genuinely conservative views but welcome all other views into the "battle of ideas in our modern world."
Nancy L. LaRoche intentionally tries to blend "debate" with demonstrations and rallies. She does this intentionally as do all of her bigoted friends because they know that people get their ideas together when they hear the many sides to these complex and complicated questions in the process of public and democratic debate--- and, then, after formulating opinions based upon what they believe to be the best information they can gather; from this informed position they go out a try to convince others to rally and demonstrate with them to try to move government, corporations or whatever in the direction they think society should be moving.
But, where has the debate been on the Obama/Wall Street agenda?
In fact, there has been no debate.
In fact, the "left" which our bigoted, Birchite friend Nancy L. LaRoche so bemoans, has had no voice what-so-ever in a debate, which I would remind the reader, has largely been an attack on socialism.
Denying a voice to the adherents of the socialist viewpoint and perspective under these circumstances can hardly pass for democracy.
By Nancy L. LaRoche's own words here, these "Tea Party" and tax-protests are nothing more than right-wing rallies; her own words give lie to the words of those like Mitch Berg, Chris Baker, Shawn Hannity and Rush Limbaugh along with the "fair and unbiased" FOX news crew that these rallies are anything but anti-communist, pro-war and pro-corporate bash the working class and attack the rest of the world rallies.
That two-bit, half-assed fascists from both the Republican and Democratic Parties participate in these rallies does not mean these rallies are open to all who oppose wasteful government spending; it means that those on the right from both political parties support and sponsor--- and exclude--- anyone not right-wing from participation.
After all, when you openly state as Nancy L. LaRoche has done that "leftists for peace" are excluded; here in the state of Minnesota you are excluding a good 40% of the population.
And, if you are "not going to pass the bullhorn" to leftists to speak about their concerns about inappropriate government spending no one, not Mitch Berg or Chris Baker or Shawn Hannity or Rush Limbaugh, can make the claim they are speaking for all Americans... they are speaking for a very, very narrow slice of America... perhaps 3% to 4% of the population... no more than this.
But, here we are supposedly talking about bringing people of "all political persuasions together" in these Tea Parties who are opposed to "government waste."
Are these "Tea Parties" also "pro-war parties and rallies?" If we listen to Nancy L. LaRoche they really are.
Not only do the American people have to ask:
We also have to ask:
Nancy L. LaRoche knew better than to demand the microphone at an anti-war rally because she was pro-war.
In her small little demented and perverted mind, patriotism is equated with being pro-war. Waving a flag is equated with being pro-war. That she convinced someone to put down a peace sign and hold the American flag tells us absolutely nothing... did she convince that person to become pro-war? No. And she knows it. That person waved the American flag to demonstrate that peace is patriotic, and war is unpatriotic.
I'm not a "flag-waver" but I will stand my patriotism for this country up against the chicken shit patriotism of these right-wing bigots hosting these Fox radio programs any day... and it they who run from the challenge of debating these issues.
That they can convince a few stupid fools like Nancy L. LaRoche to join them tells us everything we need to know about this perverted crowd of "teabaggers."
Nancy L. LaRoche tells us that she and her friends "don't bite." However, they sure want to give the working class a good "teabagging."
Teabaggers have more in common with the "steal the land from the Indians," pro-slavery, pro-Hitler crowd than with the sons and daughters of the American Revolution and Tom Paine and Benjamin Franklin or Thomas Jefferson.
Again, I reiterate my suggestion for real--- face-to-face--- debates in every city where the teabaggers are planning their events... come on Nancy L. LaRoche, your idols Mitch Berg and Chris Baker refuse to debate me... let's me and you tour these sixteen cities debating the issues involved... let's me and you debate what constitutes wasteful government spending...
bak, bak, bak, baaakkk, bak, bak, baakk, baaakkkkk, bak, bak.
No doubt Hitler was a "teabagger," just like Mitch Berg and Chris Baker in every sense of the word.
Something to think about around the dinner table--- if you can keep from gagging.
Yours in the struggle,
Alan L. Maki
From a posting to "e-democracy" to which the "moderator," Rick Mons, would not allow me the above response.
Benny
This post by right-wing bigot Nancy L. LaRoche to the "e-democracy forum" pretty much tells us the truth behind all the statements coming from the two-bit, half-assed fascist right-wing talk radio big-mouths who host these programs that somehow these teabaggers are putting on some kind of "non-partisan" events open to all who decry wasteful government spending.
Check out this response to me very closely because the truth is in what Nancy L. LaRoche posted in opposition to what I posted.
Here is what I posted which she is responding to:
Alan wrote: "Yes, you want people to attend your "Tea Party" rallies but you exclude those with a left view from speaking... wow! Real democratic.
Invite me to speak; I'll be there."
Now, notice what she says:
Alan: Do you leftist protesters pass their bullhorns and allow the other side to speak at their rallies?
This is a very frank admission that only those from the right side of the political spectrum are welcome at these "Tea Parties."
This statement here makes Mitch Berg, Chris Baker, Shawn Hannity, Rush Limbaugh and the rest of the chicken shit patriot crowd so eager to send others off to kill and die in these dirty imperialist wars being waged for control of the oil fields and gas pipeline routes along with regional domination and control of the poppy and heroin trade nothing but outright liars afraid to defend their fascist, racist, warmongering, pro-capitalist, pro-imperialist ideas. They lie when they say these "Tea Parties" were organized by "concerned citizens" from grassroots, when, in fact, these right-wing bigots and blowhards of talk radio have organized these "Tea Parties" for two reasons: 1.) As promotional publicity stunts to promote the now largely discredited right-wing talk radio; and, 2.) To try to move the country firther to the right THAN WHAT BARACK OBAMA, THE DEMOCRATS AND THE WALL STREET CROWD are already trying to take us. Make no mistake, Barack Obama is not liberal, progressive or left in any sense of the meaning of these words... Obama is definitely not a "socialist" as these racist, bigots of right-wing talk radio of are charging.
In other words, the teabaggers are not going to allow me (or any known "leftist" to address their Tax Day Rallies with the message that military spending is wasteful government spending.
The organizers of these "Tea Parties" do not want people hearing the truth that the most excessive, wasteful government spending is for wars and militarism.
These right-wing blow-hards like Mitch Berg are afraid to have me addressing their crowds saying things like:
The United States government, dominated by Wall Street bankers and coupon clippers, is wasting trillions upon trillions of dollars of tax-payer monies borrowed from Wall Street bankers to finance a vast and far-flung network of over 800 U.S. military bases on foreign soil dotting all parts of the globe instead of building 800 public health care centers right here in the United States providing free health care from cradle to grave for everyone.
Now, this self-avowed, Bircher--- this two-bit, half-assed fascist--- Nancy L. LaRoche declares that I have denied people with differing viewpoints from my own the right to speak at anti-war rallies.
This is another outright and brazen two-faced lie and she is well aware she is a liar in making this statement.
I have never in my life prevented anyone--- from any political perspective or persuasion--- with an anti-war view to speak at any anti-war rally.
To the extent it has been within my power (as one vote on a committee), I have never allowed anyone with a pro-war view to speak at an anti-war rally.
Why would I give consideration to anyone with a pro-war view to speak at an "anti-war rally?" Only a complete idiot and fool like this Birchite, Nancy L. LaRoche, would make such a statement... it is up to her and her warmongering friends who support these wars but never go off to fight them to organize their own "pro-war rallies."
However, I have organized (and participated as a debater in debates I had no part in organizing) dozens of debates all over Minnesota--- some ninety debates, in fact--- prior to the start of the war in Iraq, around the question and issue:
Should the United States Government Go To War in Iraq?
Participants in these debates, generally consisted of two or three pro and con views. As the main organizer of these debates across Minnesota I did not seek out and select participants according to my personal left-wing views. In fact, these debates included retired military people--- both pro and con--- on the question and the issue. In fact, there were even some right-wing talk show hosts who participated in these debates--- several times as the moderators. Not once was I ever accused of stacking these debates. And not once was the discourse anything but cordial. I would note, the bigots and the Birchites did condemn these debates because they included the anti-war view! You see, these two-bit, half-assed fascists do not believe in democracy or any concept of democracy. To them, democracy is only them getting out their views. These is an obviously perverted view of democracy; the same perverted view of democracy that almost thoroughly permeates right-wing talk radio--- with a very few notable exceptions of those who hold genuinely conservative views but welcome all other views into the "battle of ideas in our modern world."
Nancy L. LaRoche intentionally tries to blend "debate" with demonstrations and rallies. She does this intentionally as do all of her bigoted friends because they know that people get their ideas together when they hear the many sides to these complex and complicated questions in the process of public and democratic debate--- and, then, after formulating opinions based upon what they believe to be the best information they can gather; from this informed position they go out a try to convince others to rally and demonstrate with them to try to move government, corporations or whatever in the direction they think society should be moving.
But, where has the debate been on the Obama/Wall Street agenda?
In fact, there has been no debate.
In fact, the "left" which our bigoted, Birchite friend Nancy L. LaRoche so bemoans, has had no voice what-so-ever in a debate, which I would remind the reader, has largely been an attack on socialism.
Denying a voice to the adherents of the socialist viewpoint and perspective under these circumstances can hardly pass for democracy.
By Nancy L. LaRoche's own words here, these "Tea Party" and tax-protests are nothing more than right-wing rallies; her own words give lie to the words of those like Mitch Berg, Chris Baker, Shawn Hannity and Rush Limbaugh along with the "fair and unbiased" FOX news crew that these rallies are anything but anti-communist, pro-war and pro-corporate bash the working class and attack the rest of the world rallies.
That two-bit, half-assed fascists from both the Republican and Democratic Parties participate in these rallies does not mean these rallies are open to all who oppose wasteful government spending; it means that those on the right from both political parties support and sponsor--- and exclude--- anyone not right-wing from participation.
After all, when you openly state as Nancy L. LaRoche has done that "leftists for peace" are excluded; here in the state of Minnesota you are excluding a good 40% of the population.
And, if you are "not going to pass the bullhorn" to leftists to speak about their concerns about inappropriate government spending no one, not Mitch Berg or Chris Baker or Shawn Hannity or Rush Limbaugh, can make the claim they are speaking for all Americans... they are speaking for a very, very narrow slice of America... perhaps 3% to 4% of the population... no more than this.
But, here we are supposedly talking about bringing people of "all political persuasions together" in these Tea Parties who are opposed to "government waste."
Are these "Tea Parties" also "pro-war parties and rallies?" If we listen to Nancy L. LaRoche they really are.
Not only do the American people have to ask:
Where is the change?
We also have to ask:
Where are the debates on these issues?
Nancy L. LaRoche knew better than to demand the microphone at an anti-war rally because she was pro-war.
In her small little demented and perverted mind, patriotism is equated with being pro-war. Waving a flag is equated with being pro-war. That she convinced someone to put down a peace sign and hold the American flag tells us absolutely nothing... did she convince that person to become pro-war? No. And she knows it. That person waved the American flag to demonstrate that peace is patriotic, and war is unpatriotic.
I'm not a "flag-waver" but I will stand my patriotism for this country up against the chicken shit patriotism of these right-wing bigots hosting these Fox radio programs any day... and it they who run from the challenge of debating these issues.
That they can convince a few stupid fools like Nancy L. LaRoche to join them tells us everything we need to know about this perverted crowd of "teabaggers."
Nancy L. LaRoche tells us that she and her friends "don't bite." However, they sure want to give the working class a good "teabagging."
Teabaggers have more in common with the "steal the land from the Indians," pro-slavery, pro-Hitler crowd than with the sons and daughters of the American Revolution and Tom Paine and Benjamin Franklin or Thomas Jefferson.
Again, I reiterate my suggestion for real--- face-to-face--- debates in every city where the teabaggers are planning their events... come on Nancy L. LaRoche, your idols Mitch Berg and Chris Baker refuse to debate me... let's me and you tour these sixteen cities debating the issues involved... let's me and you debate what constitutes wasteful government spending...
bak, bak, bak, baaakkk, bak, bak, baakk, baaakkkkk, bak, bak.
No doubt Hitler was a "teabagger," just like Mitch Berg and Chris Baker in every sense of the word.
Something to think about around the dinner table--- if you can keep from gagging.
Yours in the struggle,
Alan L. Maki
From a posting to "e-democracy" to which the "moderator," Rick Mons, would not allow me the above response.
The posting was from: Nancy L LaRoche Date: 07:23 CDT Short link
Alan Maki wrote:
"Yes, you want people to attend your "Tea Party" rallies but you
exclude those with a left view from speaking... wow! Real democratic.
Invite me to speak; I'll be there."
Alan: Do you leftist protesters pass their bullhorns and allow the other side
to speak at their rallies? I've attended some anti-war protests and had great
conversations with those opposed to my views. I didn't demand the microphone.
In fact, at one three years ago I made friends with a homeless Native American
who was given an anti-war sign to carry. After we talked for a while, he put
his sign down and picked up a flag. That's what democracy is - the right to
have differing opinions and discuss openly with others. You seem to want to
dismiss and shut up those who disagree.
Come out and talk with us May 2. Try to understand our side face to face.
Again, we don't bite.
Sunday, April 12, 2009
Global steel industry awaits auto turnaround as layoffs on the Iron Range mount and MN DFL twiddles thumbs
Statement of the Iron Range Club of the Communist Party, USA
Barack Obama in an Easter Sunday holiday message had the nerve to lie to the American people about the nature of the economic depression we are in. Obama said he sees "glimmers of hope."
Obama has not been to the Iron Range.
Here on the Iron Range there are no "glimmers of hope;" only the despair that accompanies growing growing joblessness and dire poverty making the Iron Range, what Alan Maki has referred to "the Appalachia of the North with the same pits, pollution and poverty."
The economic situation and social conditions are worsening by the day on the Iron Range as working class families are now experiencing dire economic straits our grand parents tell us they have not seen since the Great Depression of the 1930's.
We and our grand parents were assured such conditions would never come about again.
We were told that Karl Marx was wrong. We were told that the capitalist system could be managed by flaky, weirdos like John Maynard Keynes and Alan Greenspan.
This generation was assured by the best paid economists Wall Street could buy that this generation would never live through an economic depression where the capitalist system collapses.
Yet, today, all economic indicators--- contrary to Barack Obama seeing "glimmers of hope," are pointing to the worst depression ever along with all the misery for working people such a catastrophe will most certainly entail as this "ball continues to drop" if we don't push back against Wall Street, and push back hard.
Larry Summers, Director of the National Economic Council--- Barack Obama's chief economic adviser--- describes the economy like a "ball dropping from the table that has not stopped falling."
Something is terribly wrong with this entire scenario. We are being played for suckers and fools as if we do not have the brains or capacity to reason and think.
Vice-president Joe Biden stated months ago that he and Obama are trying to "dropkick the ball." Here we are, months later, with Larry Summers telling us "the ball is still dropping" and hasn't even touched the ground yet.
Key to Obama's lies is that he continues to state economic troubles were caused by the "crisis in the housing market." This is an outright lie. The housing market, sabotaged by a bunch of greedy crooks not of which one has been prosecuted to date as millions of people lose their homes, is part of the problem; part of the problem contributing to the main problem. But not the primary source of the problem that Barack Obama and his over-paid economic advisers are well aware of but refuse to acknowledge because to do so would expose the capitalist system for what it has become: rotten to the core.
The present crises the capitalist economic system is experiencing is the direct result of the corporate assault on the standard-of-living of the working class that has been well underway in this country for over thirty years, and Wall Street has intensified this assault on the working class over the last eight years of Republican domination over our lives while Democrats sat back like cowards and did nothing.
The problem is one from which the capitalist economic system cannot escape:
Workers not being paid enough to purchase back what they have produced. Most working people in the United States have been receiving poverty wages; unable to purchase even the minimal basic necessities required to live decent lives.
Capitalist exploitation is THE PROBLEM. Capitalists stealing the wealth created by the working class is the source of this economic mess.
Common sense tells us that if the wealth created by the many is being constantly stolen by the rich few there is going to be severe economic problems down the road; we are now at the end of that road.
High-paid corrupt union leaders like Leo Gerard, Ron Gettelfinger and John Sweeney have worked in cahoots with big-business in forcing concession after concession from the very workers whose dues are paying their big fat salaries when they should have been putting the unions' resources into organizing the unorganized. Instead, they plowed union dues into supporting Barack Obama and the Democrats who are now kicking workers in the head while down on the ground.
How else can one explain taking away the homes of working people who are jobless and going hungry?
A moratorium on all foreclosures and evictions should have been and still is the NUMBER ONE requirement needed by hard-hit workers. This is so basic to common human decency we Communists should not even have to be stating this.
Minnesota Senator David Tomassoni could not even get the vote of one single Democrat in support of "the Minnesota People's Bailout." And the United Steel Workers and United Auto Workers unions are pumping money into getting these servants of the Chamber of Commerce, the mining, auto, banking and power industries elected!
If Senator Tomassoni and any other DFL'ers who consider themselves "progressive" don't see the need to leave the Minnesota Democratic Farmer-Labor Party after this (first it was betrayal and sell-out on saving the St. Paul Ford Twin Cities Assembly Plant) now these same rotten Democrats have defeated "the Minnesota People's Bailout" which would have halted foreclosures and evictions so widespread across the Iron Range and the rest of the state and the entire country.
Now these same Democrats are kicking the living daylights out of the working class at every opportunity; not missing an opportunity to kick workers in the head. Case in point: the auto workers; and miners right here on the Iron Range.
No two unions did more to help elect Barack Obama and the Democrats than the United Steel Workers union (USW) and the United Auto Workers union (UAW).
Steel workers and auto workers are now getting kicked in the head by Barack Obama and the Democrats without any help from the Republicans.
What does this tell us about the two-party system?
It should tell us what Communist Party leaders William Z. Foster and Gus Hall said over and over again:
The time has come for working people to get up off the ground and fight back.
Since the labor "leadership" is not willing to fight back; the rank-and-file is going to have to stand up and slug it out with these corrupt and wholly incompetent labor leaders, the Democratic Party and Wall Street.
Military recruiters are not shy about walking into our public schools trying convince our children to go fight Barack Obama's dirty imperialist wars.
A third of the ore that has been taken from the ground on the Range has gone into wars and militarism as our children die in these senseless wars that Barack Obama said were "stupid" when he wanted our votes.
Barack Obama and the Democrats are not as eager to solve our problems as they are to ship our kids off to war.
In fact, to a large extent the social and economic problems we are experiencing are directly related to these dirty imperialist wars.
As Alan Maki has pointed out, we need "800 public health care centers spread out across the United States instead of over 800 U.S. military bases dotting the globe."
On this Easter Sunday, we on the Iron Range don't see Barack Obama's "glimmers of hope."
The steel and auto industries need to be nationalized and brought under public ownership and the democratic control of the people.
We will not get a "people's bailout" until we organize some kind of "people's lobby" as part of a "massive people's front" in the struggle for an end to foreclosures and evictions and a legislated minimum wage that is a real living wage directly based upon and tied to all cost-of-living factors.
Polls now show the American people have completely lost confidence in capitalism.
The same polls demonstrate that the time is now to place socialism on the table; socialism is the only way working people are ever going to get out of this economic mess.
The time has come for working people to create a people's political party to challenge the monopolies for power, and put us on the high road to peace and jobs through socialism.
We ask Barack Obama and the lying, warmongering Democrats: Where's the change?
As the article below points out, the steel and auto industries are the key to any healthy economy.
China bailed is out and saved thousands of jobs for us here on the Iron Range.
Now that Chinese "leaders" have betrayed their people like union "leaders" here and jumped in bed with Wall Street after having been sold a bill of goods by Alan Greenspan, the CATO Institute and the Heritage Foundation that capitalist markets could provide a "quick fix" to their problems there is no place else for us to look other than to our own strength which comes through our own working class unity in getting out from under this mess.
Make no mistake, this economic mess was made by Wall Street capitalists in their never-ending drive for profits; there is no reason for the working class to have to shoulder the burden by way of being driven into poverty to get these vultures and parasites out of this mess that they created.
The corporate CEO's and bankers who created this mess are walking away with multi-million dollar "unemployment checks"--- our tax-dollars; and Barack Obama and the Democrats who expect our votes can't even come up with unemployment checks for workers from time of unemployment until time of re-employment as part of a "people's bailout." This is a disgrace.
Since working people are called upon to solve the problems we had no part in creating, we need to resolve these problems in a way that benefits the working class by improving the lives of working class families and not Wall Street pigs gorging themselves at the public trough provided courtesy of Barack Obama and the Democratic Party at our expense.
In response to those still saying: "Give Obama a chance;" we say:
Join the Communist Party.
Join the fight for peace and jobs through socialism.
Iron Range Club, CPUSA
Global steel industry awaits auto turnaround
http://news.yahoo.com/s/afp/20090412/bs_wl_afp/commoditiesmetalssteelsector
PARIS (AFP) – Steel is on edge and the global industry is cutting back hard, hanging on for either a budget blast from China, new credit for vast Middle Eastern building schemes or resurrection of the US auto industry.
Demand has dwindled and steelmakers, notably the giant of them all, ArcelorMittal, are damping down surplus furnace capacity while waiting for credit to flow, construction cranes to turn and factories to roll.
A decision by ArcelorMittal last week to pursue temporary production cutbacks, slashing European output by more than half from the end of April according to a union source, dramatises the extraordinary ride and role of steel in the last few years.
In just months the global industry has gone from a boom driven largely by China, emerging markets and a property extravaganza in the Middle East to a narrow line between excess capacity and the costs of waiting for recovery.
"Over the past six months, demand for steel has dropped dramatically and, as a result, producers have been cutting production," analysts at Barclays Capital said in a study last week.
In another report, Morgan Stanley predicted "the current demand shock to lead to excess steel capacity."
Consequently, the bank said, steel plants should operate at rates below 75 percent of capacity until 2012.
"The steel market is not very different from base metals as a whole, but steel has reacted more rapidly and dramatically since September," said commodities analyst Perrine Faye of London-based FastMarkets.
She said the future of the steel industry depended on three factors -- the impact of Chinese economic stimulus efforts, a pick-up in the Middle East construction sector and a revival of the once mighty US auto industry.
"Chinese imports and exports are at a standstill. Everyone is waiting for the Chinese stimulus package to see if it will revive demand."
The Chinese government last month announced a four-trillion-yuan (580-billion-dollar) package of measures that it said could contribute 1.5 to 1.9 percent to the country's economic growth.
Industry experts have meanwhile spoken optimistically of China's prospects.
Thomas Albanese, chief executive at steel maker Rio Tinto, said earlier this year that the company foresaw "a short, sharp slowdown in China, with demand rebounding over the course of 2009, as the fundamentals of Chinese economic growth remain sound."
Analysts have said steel inventories are falling in China in anticipation of projects expected to emerge from the country's huge stimulus package.
"It is encouraging that the inventory of steel products, especially long products, which are mostly used in construction projects, have started to fall (since the end of March), likely suggesting that end-demand is gathering momentum," Frank Gong, a Hong Kong-based economist for JPMorgan, wrote in a research note.
On-the-ground evidence suggested that the Chinese industry had been re-stocking in the first two months of the year, followed by a pause in March before major infrastructure projects were expected to start in the second quarter, Gong wrote.
In the Middle East, according to Faye, the big problem is a shortage of credit, notably for real estate developers and builders.
Construction planners had "counted on a higher price for oil and on credit to finance their huge projects."
In addition, demand for such facilities, especially in the Gulf, has died.
"They were hoping that Americans and Europeans would buy apartments. But property prices have collapsed in the Middle East as well."
In the United Arab Emirates more than half the building projects, worth 582 billion dollars or 45 per cent of the total value of the construction sector, have been put on hold, a study by Dubai-based market research group Proleads found in February.
In Dubai, one of the states of the UAE, prices in the real estate sector have slumped by an average of 25 percent from their peak in September after rallying 79 percent in the 18 months to July 2008, according to Morgan Stanley.
Faye said the fate of the steel sector was in addition tied to that of the struggling US auto industry, once a thriving steel market but one in which two of its giant players, General Motors and Chrysler, are staring at bankruptcy.
The two companies are currently limping along thanks to billions of dollars in government aid.
"We are waiting to see if the auto sector in the US will get out of the crisis intact," she said.
Barack Obama in an Easter Sunday holiday message had the nerve to lie to the American people about the nature of the economic depression we are in. Obama said he sees "glimmers of hope."
We ask: Where are the "glimmers of hope?"
Obama has not been to the Iron Range.
We ask: Where's the change?
Here on the Iron Range there are no "glimmers of hope;" only the despair that accompanies growing growing joblessness and dire poverty making the Iron Range, what Alan Maki has referred to "the Appalachia of the North with the same pits, pollution and poverty."
The economic situation and social conditions are worsening by the day on the Iron Range as working class families are now experiencing dire economic straits our grand parents tell us they have not seen since the Great Depression of the 1930's.
We and our grand parents were assured such conditions would never come about again.
We were told that Karl Marx was wrong. We were told that the capitalist system could be managed by flaky, weirdos like John Maynard Keynes and Alan Greenspan.
This generation was assured by the best paid economists Wall Street could buy that this generation would never live through an economic depression where the capitalist system collapses.
Yet, today, all economic indicators--- contrary to Barack Obama seeing "glimmers of hope," are pointing to the worst depression ever along with all the misery for working people such a catastrophe will most certainly entail as this "ball continues to drop" if we don't push back against Wall Street, and push back hard.
Larry Summers, Director of the National Economic Council--- Barack Obama's chief economic adviser--- describes the economy like a "ball dropping from the table that has not stopped falling."
Something is terribly wrong with this entire scenario. We are being played for suckers and fools as if we do not have the brains or capacity to reason and think.
Vice-president Joe Biden stated months ago that he and Obama are trying to "dropkick the ball." Here we are, months later, with Larry Summers telling us "the ball is still dropping" and hasn't even touched the ground yet.
Key to Obama's lies is that he continues to state economic troubles were caused by the "crisis in the housing market." This is an outright lie. The housing market, sabotaged by a bunch of greedy crooks not of which one has been prosecuted to date as millions of people lose their homes, is part of the problem; part of the problem contributing to the main problem. But not the primary source of the problem that Barack Obama and his over-paid economic advisers are well aware of but refuse to acknowledge because to do so would expose the capitalist system for what it has become: rotten to the core.
The present crises the capitalist economic system is experiencing is the direct result of the corporate assault on the standard-of-living of the working class that has been well underway in this country for over thirty years, and Wall Street has intensified this assault on the working class over the last eight years of Republican domination over our lives while Democrats sat back like cowards and did nothing.
The problem is one from which the capitalist economic system cannot escape:
Workers not being paid enough to purchase back what they have produced. Most working people in the United States have been receiving poverty wages; unable to purchase even the minimal basic necessities required to live decent lives.
Capitalist exploitation is THE PROBLEM. Capitalists stealing the wealth created by the working class is the source of this economic mess.
Common sense tells us that if the wealth created by the many is being constantly stolen by the rich few there is going to be severe economic problems down the road; we are now at the end of that road.
High-paid corrupt union leaders like Leo Gerard, Ron Gettelfinger and John Sweeney have worked in cahoots with big-business in forcing concession after concession from the very workers whose dues are paying their big fat salaries when they should have been putting the unions' resources into organizing the unorganized. Instead, they plowed union dues into supporting Barack Obama and the Democrats who are now kicking workers in the head while down on the ground.
How else can one explain taking away the homes of working people who are jobless and going hungry?
A moratorium on all foreclosures and evictions should have been and still is the NUMBER ONE requirement needed by hard-hit workers. This is so basic to common human decency we Communists should not even have to be stating this.
Minnesota Senator David Tomassoni could not even get the vote of one single Democrat in support of "the Minnesota People's Bailout." And the United Steel Workers and United Auto Workers unions are pumping money into getting these servants of the Chamber of Commerce, the mining, auto, banking and power industries elected!
If Senator Tomassoni and any other DFL'ers who consider themselves "progressive" don't see the need to leave the Minnesota Democratic Farmer-Labor Party after this (first it was betrayal and sell-out on saving the St. Paul Ford Twin Cities Assembly Plant) now these same rotten Democrats have defeated "the Minnesota People's Bailout" which would have halted foreclosures and evictions so widespread across the Iron Range and the rest of the state and the entire country.
Now these same Democrats are kicking the living daylights out of the working class at every opportunity; not missing an opportunity to kick workers in the head. Case in point: the auto workers; and miners right here on the Iron Range.
No two unions did more to help elect Barack Obama and the Democrats than the United Steel Workers union (USW) and the United Auto Workers union (UAW).
Steel workers and auto workers are now getting kicked in the head by Barack Obama and the Democrats without any help from the Republicans.
What does this tell us about the two-party system?
It should tell us what Communist Party leaders William Z. Foster and Gus Hall said over and over again:
Labor needs its own political party.
The time has come for working people to get up off the ground and fight back.
Since the labor "leadership" is not willing to fight back; the rank-and-file is going to have to stand up and slug it out with these corrupt and wholly incompetent labor leaders, the Democratic Party and Wall Street.
Military recruiters are not shy about walking into our public schools trying convince our children to go fight Barack Obama's dirty imperialist wars.
A third of the ore that has been taken from the ground on the Range has gone into wars and militarism as our children die in these senseless wars that Barack Obama said were "stupid" when he wanted our votes.
Barack Obama and the Democrats are not as eager to solve our problems as they are to ship our kids off to war.
In fact, to a large extent the social and economic problems we are experiencing are directly related to these dirty imperialist wars.
As Alan Maki has pointed out, we need "800 public health care centers spread out across the United States instead of over 800 U.S. military bases dotting the globe."
On this Easter Sunday, we on the Iron Range don't see Barack Obama's "glimmers of hope."
The steel and auto industries need to be nationalized and brought under public ownership and the democratic control of the people.
We will not get a "people's bailout" until we organize some kind of "people's lobby" as part of a "massive people's front" in the struggle for an end to foreclosures and evictions and a legislated minimum wage that is a real living wage directly based upon and tied to all cost-of-living factors.
Polls now show the American people have completely lost confidence in capitalism.
The same polls demonstrate that the time is now to place socialism on the table; socialism is the only way working people are ever going to get out of this economic mess.
The time has come for working people to create a people's political party to challenge the monopolies for power, and put us on the high road to peace and jobs through socialism.
We ask Barack Obama and the lying, warmongering Democrats: Where's the change?
As the article below points out, the steel and auto industries are the key to any healthy economy.
We ask: Does anyone see any indication of these two industries ever recovering again under capitalism?
China bailed is out and saved thousands of jobs for us here on the Iron Range.
Now that Chinese "leaders" have betrayed their people like union "leaders" here and jumped in bed with Wall Street after having been sold a bill of goods by Alan Greenspan, the CATO Institute and the Heritage Foundation that capitalist markets could provide a "quick fix" to their problems there is no place else for us to look other than to our own strength which comes through our own working class unity in getting out from under this mess.
Make no mistake, this economic mess was made by Wall Street capitalists in their never-ending drive for profits; there is no reason for the working class to have to shoulder the burden by way of being driven into poverty to get these vultures and parasites out of this mess that they created.
The corporate CEO's and bankers who created this mess are walking away with multi-million dollar "unemployment checks"--- our tax-dollars; and Barack Obama and the Democrats who expect our votes can't even come up with unemployment checks for workers from time of unemployment until time of re-employment as part of a "people's bailout." This is a disgrace.
We ask: Where's the change?
Since working people are called upon to solve the problems we had no part in creating, we need to resolve these problems in a way that benefits the working class by improving the lives of working class families and not Wall Street pigs gorging themselves at the public trough provided courtesy of Barack Obama and the Democratic Party at our expense.
Again, we ask Barack Obama and the Democrats: Where's the change?
In response to those still saying: "Give Obama a chance;" we say:
Join the Communist Party.
Join the fight for peace and jobs through socialism.
Iron Range Club, CPUSA
Global steel industry awaits auto turnaround
http://news.yahoo.com/s/afp/20090412/bs_wl_afp/commoditiesmetalssteelsector
PARIS (AFP) – Steel is on edge and the global industry is cutting back hard, hanging on for either a budget blast from China, new credit for vast Middle Eastern building schemes or resurrection of the US auto industry.
Demand has dwindled and steelmakers, notably the giant of them all, ArcelorMittal, are damping down surplus furnace capacity while waiting for credit to flow, construction cranes to turn and factories to roll.
A decision by ArcelorMittal last week to pursue temporary production cutbacks, slashing European output by more than half from the end of April according to a union source, dramatises the extraordinary ride and role of steel in the last few years.
In just months the global industry has gone from a boom driven largely by China, emerging markets and a property extravaganza in the Middle East to a narrow line between excess capacity and the costs of waiting for recovery.
"Over the past six months, demand for steel has dropped dramatically and, as a result, producers have been cutting production," analysts at Barclays Capital said in a study last week.
In another report, Morgan Stanley predicted "the current demand shock to lead to excess steel capacity."
Consequently, the bank said, steel plants should operate at rates below 75 percent of capacity until 2012.
"The steel market is not very different from base metals as a whole, but steel has reacted more rapidly and dramatically since September," said commodities analyst Perrine Faye of London-based FastMarkets.
She said the future of the steel industry depended on three factors -- the impact of Chinese economic stimulus efforts, a pick-up in the Middle East construction sector and a revival of the once mighty US auto industry.
"Chinese imports and exports are at a standstill. Everyone is waiting for the Chinese stimulus package to see if it will revive demand."
The Chinese government last month announced a four-trillion-yuan (580-billion-dollar) package of measures that it said could contribute 1.5 to 1.9 percent to the country's economic growth.
Industry experts have meanwhile spoken optimistically of China's prospects.
Thomas Albanese, chief executive at steel maker Rio Tinto, said earlier this year that the company foresaw "a short, sharp slowdown in China, with demand rebounding over the course of 2009, as the fundamentals of Chinese economic growth remain sound."
Analysts have said steel inventories are falling in China in anticipation of projects expected to emerge from the country's huge stimulus package.
"It is encouraging that the inventory of steel products, especially long products, which are mostly used in construction projects, have started to fall (since the end of March), likely suggesting that end-demand is gathering momentum," Frank Gong, a Hong Kong-based economist for JPMorgan, wrote in a research note.
On-the-ground evidence suggested that the Chinese industry had been re-stocking in the first two months of the year, followed by a pause in March before major infrastructure projects were expected to start in the second quarter, Gong wrote.
In the Middle East, according to Faye, the big problem is a shortage of credit, notably for real estate developers and builders.
Construction planners had "counted on a higher price for oil and on credit to finance their huge projects."
In addition, demand for such facilities, especially in the Gulf, has died.
"They were hoping that Americans and Europeans would buy apartments. But property prices have collapsed in the Middle East as well."
In the United Arab Emirates more than half the building projects, worth 582 billion dollars or 45 per cent of the total value of the construction sector, have been put on hold, a study by Dubai-based market research group Proleads found in February.
In Dubai, one of the states of the UAE, prices in the real estate sector have slumped by an average of 25 percent from their peak in September after rallying 79 percent in the 18 months to July 2008, according to Morgan Stanley.
Faye said the fate of the steel sector was in addition tied to that of the struggling US auto industry, once a thriving steel market but one in which two of its giant players, General Motors and Chrysler, are staring at bankruptcy.
The two companies are currently limping along thanks to billions of dollars in government aid.
"We are waiting to see if the auto sector in the US will get out of the crisis intact," she said.
Sunday, March 29, 2009
New Stock Market Terms & investment advice
New Stock Market Terms
CEO - Chief Embezzlement Officer
CFO - Corporate Fraud Officer
BULL MARKET - A random market movement causing an investor to mistake himself for a financial genius
BEAR MARKET - a 6 to 18 month period when the kids get no allowance, the wife gets no jewelry, and the husband gets no sex.
VALUE INVESTING - The art of buying low and selling lower.
P/E RATIO - The percentage of investors wetting their pants as the market keeps crashing.
BROKER - What my financial planner has made me.
STANDARD & POOR - Your life in a nutshell.
STOCK ANALYST - Idiot who just downgraded your stock.
STOCK SPLIT- When your ex-wife and her lawyer split your assets equally between themselves.
MARKET CORRECTION - The day after you buy stocks.
CASH FLOW - The movement your money makes as it disappears down the toilet.
YAHOO - What you yell after selling it to some poor sucker for $240 per share.
WINDOWS - What you jump out of when you're the sucker who bought Yahoo at $240 per share.
INSTITUTIONAL INVESTOR - Past year investor who's now locked up in a nuthouse.
PROFIT - an archaic word no longer in use.
# # # # #
If you had purchased $1000 of shares in Delta Airlines one year ago, you will have $49.00 today.
If you had purchased $1000 of shares in AIG one year ago, you will have $33.00 today.
If you had purchased $1000 of shares in Lehman Brothers one year ago, you will have $0.00 today.
But---- if you had purchased $1000 worth of beer one year ago, drank all the beer, then turned in the aluminum cans for recycling refund,
you will have received $214.00.
Based on the above, the best current investment plan is to drink heavily & recycle.
It's called the 401-Keg.
CEO - Chief Embezzlement Officer
CFO - Corporate Fraud Officer
BULL MARKET - A random market movement causing an investor to mistake himself for a financial genius
BEAR MARKET - a 6 to 18 month period when the kids get no allowance, the wife gets no jewelry, and the husband gets no sex.
VALUE INVESTING - The art of buying low and selling lower.
P/E RATIO - The percentage of investors wetting their pants as the market keeps crashing.
BROKER - What my financial planner has made me.
STANDARD & POOR - Your life in a nutshell.
STOCK ANALYST - Idiot who just downgraded your stock.
STOCK SPLIT- When your ex-wife and her lawyer split your assets equally between themselves.
MARKET CORRECTION - The day after you buy stocks.
CASH FLOW - The movement your money makes as it disappears down the toilet.
YAHOO - What you yell after selling it to some poor sucker for $240 per share.
WINDOWS - What you jump out of when you're the sucker who bought Yahoo at $240 per share.
INSTITUTIONAL INVESTOR - Past year investor who's now locked up in a nuthouse.
PROFIT - an archaic word no longer in use.
# # # # #
If you had purchased $1000 of shares in Delta Airlines one year ago, you will have $49.00 today.
If you had purchased $1000 of shares in AIG one year ago, you will have $33.00 today.
If you had purchased $1000 of shares in Lehman Brothers one year ago, you will have $0.00 today.
But---- if you had purchased $1000 worth of beer one year ago, drank all the beer, then turned in the aluminum cans for recycling refund,
you will have received $214.00.
Based on the above, the best current investment plan is to drink heavily & recycle.
It's called the 401-Keg.
Monday, March 23, 2009
The United States has 800 military bases on foreign soil...
What we need--- instead--- is 800 public health care centers spread out across the United States where people can universally access, for free, all their health care needs from pre-natal care, to general health care to eye, dental and mental care right through to burial.
Instead of moving in this progressive direction, President Barack Obama and the United States Congress are moving in a most reactionary direction towards establishing military bases in outer space as they seek to insure the profits of both the merchants of death and destruction and the profit-driven health care industries... talk about skewed priorities and your wacky ideas devoid of common sense.
In addition to these 800 U.S. military bases on foreign soil, Barack Obama and the United States Congress continue funding--- with our tax-dollars--- the Israeli killing machine to the tune of tens of billions of dollars.
A network of 800 public health care centers spread out across the United States would create over four-million good-paying, decent jobs--- talk about your "economic stimulus" package!
We would be planting the seeds of socialism while helping to eradicate poverty as we keep people healthy and get them well when sick.
Think about this kind of solution in relation to what Barack Obama, the U.S. Congress and the Wall Street bankers and coupon clippers are offering the American people, and the peoples of the world... just what is the reason for bailing out the banks and AIG and maintaining more than 800 expensive U.S. military bases of foreign soil?
The Mt. Carmel Clinic in Winnipeg, Manitoba, Canada offers us a glimpse at what militarization and wars continue to rob us of.
The problems created by Wall Street will not be solved as long as the military-financial-industrial complex is allowed to squander human and natural resources on militarism and wars... we might just as well be dumping these resources out into the ocean... at least no one would die in wars.
These merchants of death and destruction must be stopped if humanity is to survive in a livable world.
The time has come to talk about the working class Marxist politics and economics of livelihood... capitalism has failed humanity miserably and left us a real mess.
Something for working people to think about and discuss around the dinner table... the capitalist sooth-Sayers certainly are not going to broach such solutions to the problems of working people as they hide behind the skirt of Rosy Scenario as this global capitalist economic depression intensifies.
Alan Maki
Instead of moving in this progressive direction, President Barack Obama and the United States Congress are moving in a most reactionary direction towards establishing military bases in outer space as they seek to insure the profits of both the merchants of death and destruction and the profit-driven health care industries... talk about skewed priorities and your wacky ideas devoid of common sense.
In addition to these 800 U.S. military bases on foreign soil, Barack Obama and the United States Congress continue funding--- with our tax-dollars--- the Israeli killing machine to the tune of tens of billions of dollars.
A network of 800 public health care centers spread out across the United States would create over four-million good-paying, decent jobs--- talk about your "economic stimulus" package!
We would be planting the seeds of socialism while helping to eradicate poverty as we keep people healthy and get them well when sick.
Think about this kind of solution in relation to what Barack Obama, the U.S. Congress and the Wall Street bankers and coupon clippers are offering the American people, and the peoples of the world... just what is the reason for bailing out the banks and AIG and maintaining more than 800 expensive U.S. military bases of foreign soil?
The Mt. Carmel Clinic in Winnipeg, Manitoba, Canada offers us a glimpse at what militarization and wars continue to rob us of.
The problems created by Wall Street will not be solved as long as the military-financial-industrial complex is allowed to squander human and natural resources on militarism and wars... we might just as well be dumping these resources out into the ocean... at least no one would die in wars.
These merchants of death and destruction must be stopped if humanity is to survive in a livable world.
The time has come to talk about the working class Marxist politics and economics of livelihood... capitalism has failed humanity miserably and left us a real mess.
Something for working people to think about and discuss around the dinner table... the capitalist sooth-Sayers certainly are not going to broach such solutions to the problems of working people as they hide behind the skirt of Rosy Scenario as this global capitalist economic depression intensifies.
Alan Maki
Wednesday, March 18, 2009
The big lie about AIG
The big lie about AIG:
From---
U.S.News & World Report (see complete article following my comments)
What's Good, What's Bad About the AIG Bailout
“It's keeping AIG's insurance businesses stable. Here's something that's really startling: The entire problem at AIG was caused by one unit, the Financial Products division, whose employees constituted less than one percent of AIG's overall workforce. AIG's insurance units - the core of its business - essentially had nothing to do with the fiasco. But if AIG had been forced to liquidate, it could have affected the insurance units and millions of policyholders. With a more orderly process underway, the policyholders are now completely protected.”
This is the truth:
The entire problem at AIG was caused by one unit, the Financial Products division
But if AIG had been forced to liquidate, it could have affected the insurance units and millions of policyholders. With a more orderly process underway, the policyholders are now completely protected.
Question:
Who are these AIG “policyholders?”
Answer:
These AIG “policyholders” are the largest multi-national corporations in the world… and include corporations from every industry, from media to banking/mortgage to auto and steel to toys.
Question:
What kind of insurance policies have the multi-national corporations purchased from AIG?
Answer:
These “policyholders” have purchased insurance from AIG to protect their profits.
Question:
What kind of “claims” are they filing?
Answer:
These multi-national policyholders are making claims based upon their loss of profits due to the recession/depression.
Comment:
Our tax-dollars are paying on “claims” being filed by these multi-national corporations for losses in profits as the economy goes south.
Comment:
While the disgraceful tens of millions of dollars in executive “bonuses” paid by AIG are now the justified topic of wide-spread discussion; these “bonuses” are being used a “Trojan Horse” of sorts by the media and politicians who don’t want to disclose to the American people where the hundreds of BILLIONS of dollars are going.
Comment:
Make no mistake, the $170,000,000,000.00 (one-hundred seventy billion dollars) paid out to AIG is just the beginning… as the depression deepens these multi-national corporations will continue filing claims and AIG will have to honor the policies these corporations purchased to protect their profitability… our tax-dollars are going directly into the pockets of the Wall Street coupon clippers and the very mortgage company crooks who ripped off the American people.
Comment:
For the American tax-payer, there is nothing “good” about the bailout of AIG… except to the stock and bondholders and bankers and mortgage companies and the big industrialists and investors who will continue to pocket profits at tax-payer expense, everything about the AIG “bailout” is bad.
Conclusion:
The “bailout” of AIG with our tax-dollars is doing nothing but stabilizing Wall Street “profits.”
AIG’s insurance business is the business of protecting multi-national corporations against a loss in profits.
Once the tax-dollars stop flowing into the coffers of AIG and flooding out to the multi-national corporations, the world stock markets will collapse and we will be in the midst of the worst capitalist economic depression humanity has ever known--- complete with all the accompanying human misery and social strife one would expect--- now being widely predicted by many diverse voices.
On top of all of this, the American dollar will become worthless and we will be forced to purchase oil with Euros and Rubles… then what?
And if the Chinese aren’t dumb enough to buy into the American capitalist economic mess… then what?
In spite of what the highest-paid capitalist sooth-Sayers are telling us, capitalism as an economic system is finished… it is time to explore a socialist solution where production takes place to solve human needs rather than for profit… there is no other solution.
The multi-national corporations purchased insurance policies to protect their profits against recession/depression incurred losses from AIG, a private--- for profit--- insurance company, which assumed the risk in underwriting such policies.
The multi-national corporations did not purchase insurance policies from the United States government; so why should tax-payers be the ones paying out on these claims?
This is the biggest corporate swindle in history… in comparison, Bernie Madoff is a piker… we are being played for suckers.
We need a national “people’s bailout” based on the “Minnesota People’s bailout.”
The time has come to take a “left turn” to get us off this road to perdition as the capitalist system collapses.
Big-business created this economic mess as they reaped the profits while leaving working people with ALL the problems.
Alan L. Maki
U.S.News & World Report
What's Good, What's Bad About the AIG Bailout
http://biz.yahoo.com/usnews/090317/17_whats_good_whats_bad_about_the_aig_bailout.html?.&.pf=insurance
Tuesday March 17, 1:52 pm ET
By Rick Newman
"There are times when one would like to hang the whole human race, and finish the farce."
The latest surreal twists in the AIG bailout bring to mind Mark Twain, who could spot folly as if he were hunting for it with a spyglass. Had Twain had AIG to work with as raw material, we'd probably have another couple dozen enduring epigrams skewering the greedy and the foolish.
Many Americans would like to finish the farce and simply cut AIG off, especially now that the company has paid $165 million in bonuses to executives at the very unit that nearly caused the firm's downfall and triggered an unprecedented taxpayer bailout that now totals $170 billion. To almost everybody, it seems self-evident that traders shouldn't be rewarded for wrecking their company and then burning through vast amounts of public funds. Yet AIG insists it is legally obligated to pay the bonuses, because of contracts signed before the damage occurred and taxpayers got involved. There have also been suggestions that the rascals who devised these complex derivatives deals may be the only ones who know how to unwind them, so AIG has no choice but to keep them around - and pay for the privilege of their company. In other words, the bonuses amount to extortion.
Okay. Breathe deep. Think calming thoughts. Find your center. Amidst this outrage, it's worth keeping in mind that the AIG bailout is actually doing some good. It's also a kind of learn-as-you-go experiment that's never really been done before. Here's a rough scorecard of what's working and what's not:
What's working
The AIG bailout has helped stabilize the financial markets. Take a moment to revisit September 2008. That's when Lehman Brothers failed, Merrill Lynch almost did, and AIG would have been forced into a chaotic bankruptcy if the feds didn't arrange an emergency $85 billion loan. With a bit of hindsight, it's starting to seem that AIG, which brokered more than $2.5 trillion worth of derivatives known as credit-default swaps held by many of the world's biggest banks, was the death star of that troubled troika.
We've survived the Lehman bankruptcy, after all, and Merrill found a buyer. "The real surprise wasn't Lehman Brothers, it was AIG," Frederic Mishkin, a Columbia Business School professor and former member of the Federal Reserve Board, said in a recent speech. "Who would have thought that an insurance company would have been affected by all this? When that happened, all bets were off."
All that federal money has helped AIG redeem some of those derivatives contracts, getting them off its books and out of the system. The financial markets still aren't back to normal, but they're heading in that direction. Forestalling another industrial-strength financial failure, and the chain reaction it would have triggered if AIG had collapsed, has certainly helped.
It's also helping AIG unwind itself. AIG's problems snowballed in September when suddenly it had to produce billions of dollars worth of collateral to back up those credit-default swaps. The collateral call was triggered by an unexpected drop in AIG's credit rating, along with the plunge in value of mortage-backed securities around the world. AIG didn't have the cash, and to come up with it, the only option would have been to sell off illiquid assets like its highly profitable insurance divisions or its aircraft leasing company. Try doing that in a week.
Had AIG been forced to liquidate those assets, it would have had to accept fire-sale prices, which would have led to a sudden collapse in the prices of other similar assets and companies throughout the world. AIG would have gotten pennies on the dollar for valuable assets and many other businesses would suddenly have been devalued, too.
AIG is still in the process of selling off assets, to pay off the government loans that effectively served as its collateral. But it's doing that in a more orderly way, seeking the highest bidders and the best terms. That's generally good for everybody, and it's also the best way for taxpayers to get most or all of their money back.
It's keeping AIG's insurance businesses stable. Here's something that's really startling: The entire problem at AIG was caused by one unit, the Financial Products division, whose employees constituted less than one percent of AIG's overall workforce. AIG's insurance units - the core of its business - essentially had nothing to do with the fiasco. But if AIG had been forced to liquidate, it could have affected the insurance units and millions of policyholders. With a more orderly process underway, the policyholders are now completely protected.
What's not working
Revolting bonuses. It simply goes without saying that giving bonuses to the people who brought down AIG is a perversion of justice. Officials at the Federal Reserve and the Treasury Dept. should have put terms into the original bailout agreement that prevented this. They didn't. It was a chaotic time, and legitimate worries about a global financial collapse obviously clouded thoughts about rules to prevent rapacious traders from holding the government hostage. If it's any consolation, the $165 million bonus pool is relatively small. Still, it grates.
Counterparty payouts. AIG has used much of the $170 billion in government aid to basically refund money to big banks and other "counterparties," to cash out some of those credit-default swaps and reduce AIG's massive liabilities. That's sensible, and it's basically the original idea behind the "Troubled Assets Relief Program," which was intended to get the worst derivatives and other securities off the market.
The problem is that the government has apparently agreed to $105 billion worth of payouts - at the full face value of the securities. That means that banks like Goldman Sachs, Merrill Lynch, Societe General and Deutsche Bank - among the world's most sophisticated investors - are taking no loss at all on securities that had a market value of half their face value or less when AIG redeemed them in full. It's like house prices falling in your neighborhood by 50 percent, and somebody coming in and buying one house for what it was worth at the market peak a couple years ago. And using a government loan to finance it.
Regulators at the Fed, Treasury, and other departments still haven't explained why the counterparties got all their money back. They're certainly going to be asked at upcoming Congressional hearings. But in a situation where just about everybody is taking a loss - taxpayers and consumers especially - it will be tough to make a case that the world's richest banks deserve full redemption.
Secrecy. We keep learning the terms of the AIG bailout well after the fact. Obviously there are times when the feds need to move quickly and can't have a 60-day comment period. But it's not the same crisis atmosphere as last fall. In general, we should learn the details of the bailout as they occur.
AIG strongly resisted releasing the list of counterparties that have been paid back with bailout money, for instance. As recently as March 5, Federal Reserve Vice Chairman Donald Kohn defended that secrecy, saying that firms might be reluctant to deal with AIG in the future if they knew their dealings could become public.
Then a week later, under mounting pressure, AIG released a list of counterparties. The world didn't end. AIG is also refusing to release the names of individuals in the Financial Products division who are getting bonuses. They may lose that battle too, since New York Attorney General Andrew Cuomo has asked for the names and started an investigation, much as he has with Merrill Lynch. Information is going to come out one way or the other, and AIG and its regulators should stop trying to protect the failing company any more than they already are. When AIG pays back that $170 billion in taxpayer money, they can keep all the secrets they want. In fact, once we've got our money back, the less we hear about AIG the better.
Alan L. Maki
58891 County Road 13
Warroad, Minnesota 56763
Phone: 218-386-2432
Cell phone: 651-587-5541
E-mail: amaki000@centurytel.net
Check out my blog:
Thoughts From Podunk
http://thepodunkblog.blogspot.com/
From---
U.S.News & World Report (see complete article following my comments)
What's Good, What's Bad About the AIG Bailout
“It's keeping AIG's insurance businesses stable. Here's something that's really startling: The entire problem at AIG was caused by one unit, the Financial Products division, whose employees constituted less than one percent of AIG's overall workforce. AIG's insurance units - the core of its business - essentially had nothing to do with the fiasco. But if AIG had been forced to liquidate, it could have affected the insurance units and millions of policyholders. With a more orderly process underway, the policyholders are now completely protected.”
This is the truth:
The entire problem at AIG was caused by one unit, the Financial Products division
But if AIG had been forced to liquidate, it could have affected the insurance units and millions of policyholders. With a more orderly process underway, the policyholders are now completely protected.
Question:
Who are these AIG “policyholders?”
Answer:
These AIG “policyholders” are the largest multi-national corporations in the world… and include corporations from every industry, from media to banking/mortgage to auto and steel to toys.
Question:
What kind of insurance policies have the multi-national corporations purchased from AIG?
Answer:
These “policyholders” have purchased insurance from AIG to protect their profits.
Question:
What kind of “claims” are they filing?
Answer:
These multi-national policyholders are making claims based upon their loss of profits due to the recession/depression.
Comment:
Our tax-dollars are paying on “claims” being filed by these multi-national corporations for losses in profits as the economy goes south.
Comment:
While the disgraceful tens of millions of dollars in executive “bonuses” paid by AIG are now the justified topic of wide-spread discussion; these “bonuses” are being used a “Trojan Horse” of sorts by the media and politicians who don’t want to disclose to the American people where the hundreds of BILLIONS of dollars are going.
Comment:
Make no mistake, the $170,000,000,000.00 (one-hundred seventy billion dollars) paid out to AIG is just the beginning… as the depression deepens these multi-national corporations will continue filing claims and AIG will have to honor the policies these corporations purchased to protect their profitability… our tax-dollars are going directly into the pockets of the Wall Street coupon clippers and the very mortgage company crooks who ripped off the American people.
Comment:
For the American tax-payer, there is nothing “good” about the bailout of AIG… except to the stock and bondholders and bankers and mortgage companies and the big industrialists and investors who will continue to pocket profits at tax-payer expense, everything about the AIG “bailout” is bad.
Conclusion:
The “bailout” of AIG with our tax-dollars is doing nothing but stabilizing Wall Street “profits.”
AIG’s insurance business is the business of protecting multi-national corporations against a loss in profits.
Once the tax-dollars stop flowing into the coffers of AIG and flooding out to the multi-national corporations, the world stock markets will collapse and we will be in the midst of the worst capitalist economic depression humanity has ever known--- complete with all the accompanying human misery and social strife one would expect--- now being widely predicted by many diverse voices.
On top of all of this, the American dollar will become worthless and we will be forced to purchase oil with Euros and Rubles… then what?
And if the Chinese aren’t dumb enough to buy into the American capitalist economic mess… then what?
In spite of what the highest-paid capitalist sooth-Sayers are telling us, capitalism as an economic system is finished… it is time to explore a socialist solution where production takes place to solve human needs rather than for profit… there is no other solution.
The multi-national corporations purchased insurance policies to protect their profits against recession/depression incurred losses from AIG, a private--- for profit--- insurance company, which assumed the risk in underwriting such policies.
The multi-national corporations did not purchase insurance policies from the United States government; so why should tax-payers be the ones paying out on these claims?
This is the biggest corporate swindle in history… in comparison, Bernie Madoff is a piker… we are being played for suckers.
We need a national “people’s bailout” based on the “Minnesota People’s bailout.”
The time has come to take a “left turn” to get us off this road to perdition as the capitalist system collapses.
Big-business created this economic mess as they reaped the profits while leaving working people with ALL the problems.
Alan L. Maki
U.S.News & World Report
What's Good, What's Bad About the AIG Bailout
http://biz.yahoo.com/usnews/090317/17_whats_good_whats_bad_about_the_aig_bailout.html?.&.pf=insurance
Tuesday March 17, 1:52 pm ET
By Rick Newman
"There are times when one would like to hang the whole human race, and finish the farce."
The latest surreal twists in the AIG bailout bring to mind Mark Twain, who could spot folly as if he were hunting for it with a spyglass. Had Twain had AIG to work with as raw material, we'd probably have another couple dozen enduring epigrams skewering the greedy and the foolish.
Many Americans would like to finish the farce and simply cut AIG off, especially now that the company has paid $165 million in bonuses to executives at the very unit that nearly caused the firm's downfall and triggered an unprecedented taxpayer bailout that now totals $170 billion. To almost everybody, it seems self-evident that traders shouldn't be rewarded for wrecking their company and then burning through vast amounts of public funds. Yet AIG insists it is legally obligated to pay the bonuses, because of contracts signed before the damage occurred and taxpayers got involved. There have also been suggestions that the rascals who devised these complex derivatives deals may be the only ones who know how to unwind them, so AIG has no choice but to keep them around - and pay for the privilege of their company. In other words, the bonuses amount to extortion.
Okay. Breathe deep. Think calming thoughts. Find your center. Amidst this outrage, it's worth keeping in mind that the AIG bailout is actually doing some good. It's also a kind of learn-as-you-go experiment that's never really been done before. Here's a rough scorecard of what's working and what's not:
What's working
The AIG bailout has helped stabilize the financial markets. Take a moment to revisit September 2008. That's when Lehman Brothers failed, Merrill Lynch almost did, and AIG would have been forced into a chaotic bankruptcy if the feds didn't arrange an emergency $85 billion loan. With a bit of hindsight, it's starting to seem that AIG, which brokered more than $2.5 trillion worth of derivatives known as credit-default swaps held by many of the world's biggest banks, was the death star of that troubled troika.
We've survived the Lehman bankruptcy, after all, and Merrill found a buyer. "The real surprise wasn't Lehman Brothers, it was AIG," Frederic Mishkin, a Columbia Business School professor and former member of the Federal Reserve Board, said in a recent speech. "Who would have thought that an insurance company would have been affected by all this? When that happened, all bets were off."
All that federal money has helped AIG redeem some of those derivatives contracts, getting them off its books and out of the system. The financial markets still aren't back to normal, but they're heading in that direction. Forestalling another industrial-strength financial failure, and the chain reaction it would have triggered if AIG had collapsed, has certainly helped.
It's also helping AIG unwind itself. AIG's problems snowballed in September when suddenly it had to produce billions of dollars worth of collateral to back up those credit-default swaps. The collateral call was triggered by an unexpected drop in AIG's credit rating, along with the plunge in value of mortage-backed securities around the world. AIG didn't have the cash, and to come up with it, the only option would have been to sell off illiquid assets like its highly profitable insurance divisions or its aircraft leasing company. Try doing that in a week.
Had AIG been forced to liquidate those assets, it would have had to accept fire-sale prices, which would have led to a sudden collapse in the prices of other similar assets and companies throughout the world. AIG would have gotten pennies on the dollar for valuable assets and many other businesses would suddenly have been devalued, too.
AIG is still in the process of selling off assets, to pay off the government loans that effectively served as its collateral. But it's doing that in a more orderly way, seeking the highest bidders and the best terms. That's generally good for everybody, and it's also the best way for taxpayers to get most or all of their money back.
It's keeping AIG's insurance businesses stable. Here's something that's really startling: The entire problem at AIG was caused by one unit, the Financial Products division, whose employees constituted less than one percent of AIG's overall workforce. AIG's insurance units - the core of its business - essentially had nothing to do with the fiasco. But if AIG had been forced to liquidate, it could have affected the insurance units and millions of policyholders. With a more orderly process underway, the policyholders are now completely protected.
What's not working
Revolting bonuses. It simply goes without saying that giving bonuses to the people who brought down AIG is a perversion of justice. Officials at the Federal Reserve and the Treasury Dept. should have put terms into the original bailout agreement that prevented this. They didn't. It was a chaotic time, and legitimate worries about a global financial collapse obviously clouded thoughts about rules to prevent rapacious traders from holding the government hostage. If it's any consolation, the $165 million bonus pool is relatively small. Still, it grates.
Counterparty payouts. AIG has used much of the $170 billion in government aid to basically refund money to big banks and other "counterparties," to cash out some of those credit-default swaps and reduce AIG's massive liabilities. That's sensible, and it's basically the original idea behind the "Troubled Assets Relief Program," which was intended to get the worst derivatives and other securities off the market.
The problem is that the government has apparently agreed to $105 billion worth of payouts - at the full face value of the securities. That means that banks like Goldman Sachs, Merrill Lynch, Societe General and Deutsche Bank - among the world's most sophisticated investors - are taking no loss at all on securities that had a market value of half their face value or less when AIG redeemed them in full. It's like house prices falling in your neighborhood by 50 percent, and somebody coming in and buying one house for what it was worth at the market peak a couple years ago. And using a government loan to finance it.
Regulators at the Fed, Treasury, and other departments still haven't explained why the counterparties got all their money back. They're certainly going to be asked at upcoming Congressional hearings. But in a situation where just about everybody is taking a loss - taxpayers and consumers especially - it will be tough to make a case that the world's richest banks deserve full redemption.
Secrecy. We keep learning the terms of the AIG bailout well after the fact. Obviously there are times when the feds need to move quickly and can't have a 60-day comment period. But it's not the same crisis atmosphere as last fall. In general, we should learn the details of the bailout as they occur.
AIG strongly resisted releasing the list of counterparties that have been paid back with bailout money, for instance. As recently as March 5, Federal Reserve Vice Chairman Donald Kohn defended that secrecy, saying that firms might be reluctant to deal with AIG in the future if they knew their dealings could become public.
Then a week later, under mounting pressure, AIG released a list of counterparties. The world didn't end. AIG is also refusing to release the names of individuals in the Financial Products division who are getting bonuses. They may lose that battle too, since New York Attorney General Andrew Cuomo has asked for the names and started an investigation, much as he has with Merrill Lynch. Information is going to come out one way or the other, and AIG and its regulators should stop trying to protect the failing company any more than they already are. When AIG pays back that $170 billion in taxpayer money, they can keep all the secrets they want. In fact, once we've got our money back, the less we hear about AIG the better.
Alan L. Maki
58891 County Road 13
Warroad, Minnesota 56763
Phone: 218-386-2432
Cell phone: 651-587-5541
E-mail: amaki000@centurytel.net
Check out my blog:
Thoughts From Podunk
http://thepodunkblog.blogspot.com/
Tuesday, March 3, 2009
Nationalization, Socialism, and the U.S. Banks
North Dakota has a state owned bank. Benny
Nationalization, Socialism, and the U.S. Banks
By Jim Genova
Associate Professor of History
The Ohio State University-Marion
In the midst of the unfolding global economic crisis politicians, pundits, and bankers have engaged in much hyperbolic discussion about the prospect that major banks in the U.S. may be “nationalized.” On 27 February the U.S. Treasury Department announced that it was converting its “preferred shares” in Citibank into “common shares” giving it a 36% ownership in one of the world’s largest financial institutions. This and other actions taken on the part of the Federal Reserve and U.S. Treasury Department since the crisis began to accelerate last Autumn has led hardened neo-liberal ideologues to exclaim that this is “creeping socialism.” The proclamations of many anchors across the business channels, Conservatives gathered in Washington on 28 February, and Republicans in Congress during the debate over the stimulus bill have elevated to the level of mainstream discourse a conversation over the meaning of the terms “nationalization” and “socialism,” even if the purpose of such right-wing defenders of unbridled global capitalism is to induce ideological confusion and a sense of panic.
On 25 February, members of the House Financial Services Committee asked Fed Chairman Ben Bernanke to explain what he understood to be the definition of “nationalization.” In response, he said it is when “the government ‘seizes’ a company, ‘zeroes out the shareholders and begins to manage and run the bank.” He reassured the anxious Congressmen that “we don’t plan anything like that.”[1] Treasury Secretary Timothy Geithner seconded Bernanke’s comments, describing nationalization as “the wrong strategy for the country and I don’t think it’s a necessary strategy.”[2] Sen. Charles Schumer, member of the Senate Banking Committee, also tried to reassure a nervous investor class stating that a “federal takeover of the banks should be avoided at all costs. No one intends, ever, to have the government running these banks or insurance companies for a long period of time.” His goal, somewhat more ambitious than that proposed by either Bernanke or Treasury Secretary Timothy Geithner, is to have the government “come in, clean them out, take out the bad assets, put in new management.”[3] Despite such reassurances from those at the center of power, howls from the right and from brokers on the floor of the New York Stock Exchange and Chicago Mercantile Exchange continue to charge that the U.S. beginning under the Bush Administration and continuing at an accelerated pace is heading down the road to “socialism.”
None of the half-measures, abrupt shifts in policy, or tenuous interventions in the financial sector over the past year at least (Bear Stearns went under on 17 March 2008) have been effective at stemming the ever deepening global financial crisis. Banks continue to fail, large monopolistic financial institutions are reeling around the world, and the global economy is spiraling into perhaps its worst crisis ever. Events, as the recent contorted interventions to rescue Citibank have shown, are forcing the leaders of U.S. capitalism to make very difficult and, to them, unpalatable decisions. Neither former Treasury Secretary Henry Paulson (a supposed expert on the Great Depression of the 1930s) nor current Treasury head Tim Geithner (Governor of the New York Fed when Lehman Brothers went down in September 2008) appear to have to will to carry off what is historically necessary – the outright seizure of the major financial institutions of this country. This should not surprise us as they are “true believers” in the neo-liberal capitalist world order. For them, the current crisis is perplexing since it should not be happening at all. At the very least, the market should have shown the way out by now. This led former Fed Chairman Alan Greenspan to recently acknowledge before Congress that the theory to which he (along with Paulson, Bernanke, and Geithner) ascribed was “deeply flawed.” No such statement of contrition has as of yet come forth from Bernanke and Geithner.
Ultimately, many analysts believe that the U.S. government will have no choice but to nationalize some of the largest financial firms, including Citibank, Bank of America, and some large regional banks.[4] Nobel Laureate Joseph Stiglitz recently echoed calls from leading economists Nouriel Roubini and Nassim Taleb to nationalize the U.S. banks telling German television network Deutsche Welle “the banks have failed. Nationalization is the only answer.”[5] Stiglitz has much experience at the center of global finance having served as a member of President Clinton’s Council of Economic Advisors (1993-1997) and as Chief Economist and Senior Vice President of the World Bank (1997-2000). During those terms he witnessed the LTCM and East Asia currency crises (1996-1998) that some economists like Paul Krugman warned was a prelude to a global economic depression.[6] What has happened in the meantime is that trillions of dollars have been thrown down the bottomless chute of fundamentally insolvent institutions beyond hope of rescue.[7] Moreover, for all of this public money used to prop up badly run speculative private institutions not once has the government forced the management to resign (the recent move at Citibank showed the first signs of the Treasury making demands about the composition of corporate boards) nor has it called for any “claw back” provisions of the bonuses and extravagant pay for executives who ran their enterprises into the ground. Instead, public wealth is being transferred on a rapidly moving conveyor belt into the hands of unscrupulous and failed bankers. This is becoming one of the greatest thefts in world history. As Stiglitz told Deutche Welle, “separation of ownership from control is a recipe for disaster.”[8]
What is called for is an emergency solution not unlike that confronting Russia in the summer of 1917 when the Bolshevik leader V. I. Lenin wrote The Threatening Catastrophe and How to Fight It. In that pamphlet, Lenin described an unfolding crisis where the wheels of the Russian economy were grinding to a halt. Banks had ceased lending, railroads were shutting down, food supplies were dwindling, and unemployment was mounting. Lenin also noted that there was much public discussion among politicians and leaders of industry that something dramatic had to be done to salvage the situation. “Everybody says that. Everybody recognizes that. Everybody has agreed to that. And nothing is being done.”[9] Even more recently, Sweden’s experience in the early 1990s has been held up as analogous to the broad parameters of the current U.S. situation. There a housing boom in the late 1980s led to speculation on mortgage-backed debt that eventually ended badly leading to the government taking effective control of the largest banks. Sweden then forced the banks to create two institutions under one roof – a good bank and a bad bank. All of the “toxic assets” were concentrated in the bad banks, which gradually (over four years) sold them off.[10] The problem with using Sweden’s banking crisis as a model for understanding our own is that not only is Sweden’s economy a fraction of the size of that in the U.S. but its institutions are not at the epicenter of the global capitalist system. Institutions like CitiGroup, Morgan Stanley, Bank of America, JP Morgan Chase, Goldman Sachs, and others are global monopolistic enterprises with branches, partners, and subsidiaries throughout the world. Moreover, they are the vehicles through which the leaders of U.S. government pass on their way to political power. Consequently, there is an incestuous relationship between the “too big to fail” banks and the officials in charge of their oversight. There was nothing analogous in Sweden’s case. Finally, the U.S. crisis does not stem entirely from a decline in home prices (the much vaunted bursting of the housing bubble). Rather, for decades there has been a mounting structural weakness in the U.S. economy and by extension global capitalism. That is the overwhelming dependence for the survival and expansion of the system on debt of all kinds – credit cards, mortgages, auto financing, leveraged stock trading, and greatly expanded issuing of public debt of many varieties. Since the early 1970s there has been a widening disconnect between the real wages of workers in the industrialized world and the accumulation of public and private debt.[11]
We are at a crossroads in the current crisis. Every leading politician, pundit, and financial analyst acknowledges that the situation requires urgent action. On financial, ethical, and political grounds it is imperative that the U.S. government nationalize the major financial institutions, place them under federal control, unify them into one central bank to provide for more efficient management, and completely dispatch the executive management of those firms that have been seized. Only through that device can the process of daily pumping billions upon billions into dead institutions be stopped. Only through such bold moves can the government gain the leverage it needs to control the credit markets, make interest rates meaningful, and aggressively restructure mortgages. Only through the decisive action of seizing, controlling, and re-directing the functioning of the banks to serve the immediate and long-term needs of the people can the rate of decline be slowed and some stability be restored to the financial sector of the economy.[12]
This should not be confused with socialism. Such labeling is an effort on the part of those ideologues still committed to the failed neo-liberal policies of the Washington Consensus dating to Reagan and Thatcher years of the early 1980s to derail any meaningful assistance to those workers, farmers, and middle class people who are suffering because of the greed of the capitalist elite. Moreover, it is the same callousness that those practitioners of gung-ho capitalism displayed in guiding IMF and World Bank policies on a path to crippling and impoverishing developing countries around the world through “Structural Adjustment Programs.” Lenin clearly delineated the difference between “state monopoly capitalism” and socialism, but argued that it was imperative in the period of impending catastrophe that responsible officials of any government take the decisive measures necessary to save people from mass unemployment, famine, and deep social dislocation. That the global economic crisis portends widespread political upheaval has been attested to by analysts and researchers who work in Africa, Asia, and Latin America.[13] In describing the 1917 crisis in Russia, Lenin wrote that nationalizing the banks would improve “the accessibility and the easy terms of credit, particularly for small owners [and] for the peasantry.” Further, the state would “be in a position to survey all the main monetary operations without concealing them, then to control them, then to regulate economic life, and finally to obtain millions and billions for large state operations.”[14] This addresses many of the most salient aspects of the crisis in the financial sector: transparency, accountability, assistance for those who actually need it, saving funds that will be needed for further stimulus, and it resolves the fatal disconnect Stiglitz identified in the current approach between having ownership without control. Beyond the current crisis, though, since the capitalist ideologues have raised the specter of socialism in the U.S., it is an opportunity for progressive forces to intervene in the public conversation and offer a real understanding of what socialism is while also highlighting the ultimate flaws of capitalism that can never be overcome or resolved from inside the system. This is an historic opportunity for the government to act on behalf of the people to mitigate the effects of a dying system and for progressives to make the case for socialism. The fate of millions of people around the world depends on the abilities of both to do what is historically necessary.
[1] Craig Torres and Bradley Keoun, “Bernanke Rejects ‘Anything Like’ Bank Nationalization,” Bloomberg.com 25 February 2009.
[2] Robert Schmidt, “Geithner Calls Nationalizing Banks ‘Wrong Strategy’ for Economy,” Bloomberg.com, 25 February 2009.
[3] Torres and Keoun, “Bernanke Rejects ‘Anything Like’ Bank Nationalization.”
[4] Matthew Richardson, “The Case for and against Bank Nationalisation,” VoxEU.org, 26 February 2009.
[5] Michael Knigge, “Stiglitz: Nationalized Banks are ‘Only Answer’,” Deutche Welle, 16 February 2009. Reprinted in the People’s Weekly World.
[6] Paul Krugman, The Return of Depression Economics and The Crisis of 2008, New York: W. W. Norton, 2008.
[7] On 27 February Bloomberg Financial Group provided an assessment of the entire contribution made by the Federal Reserve and U.S. Treasury Department to prop up the financial system since the beginnings of the crisis in August 2007. Its conclusion was that to date $11.6 trillion has been either spent or taken on as liabilities in the process. This includes cash injections into the trading markets, the TARP and other emergency programs, loans to banks facilitating their takeover of other even worse off financial institutions, the seizures of AIG, Freddie Mac, and Fannie Mae, loans to the Auto Industry, and the expansion of the Fed’s balance sheet to facilitate the commercial paper market that seized in September and October 2008.
[8] Knigge, “Stiglitz: Nationalized Banks are ‘Only Answer.””
[9] V. I. Lenin, The Threatening Catastrophe and How to Fight It, New York; International Publishers, 1932, p. 5. The essay was written 23-27 September 1917.
[10] Edward Harrison, “Did Sweden Really Nationalize Its Banks?” online blog post, 25 February 2009.
[11] Federal Reserve Table 100.B Data for 1945-2005, published by AutoDogmatic.com.
[12] Binyamin Appelbaum, “What Is Nationalization? Depends Who You Ask,” Washington Post, 25 February 2009. See also Robert Griffiths, “Why Nationalization Isn’t Socialism,” Politicalaffairs.net, 3 November 2008, reproduced from the Morning Star.
[13] Nelson D. Schwartz, “Job Losses Pose a threat to Stability Worldwide,” New York Times, 15 February 2009.
[14] Lenin, The Threatening Catastrophe and How to Fight It. Italics in the original.
Nationalization, Socialism, and the U.S. Banks
By Jim Genova
Associate Professor of History
The Ohio State University-Marion
In the midst of the unfolding global economic crisis politicians, pundits, and bankers have engaged in much hyperbolic discussion about the prospect that major banks in the U.S. may be “nationalized.” On 27 February the U.S. Treasury Department announced that it was converting its “preferred shares” in Citibank into “common shares” giving it a 36% ownership in one of the world’s largest financial institutions. This and other actions taken on the part of the Federal Reserve and U.S. Treasury Department since the crisis began to accelerate last Autumn has led hardened neo-liberal ideologues to exclaim that this is “creeping socialism.” The proclamations of many anchors across the business channels, Conservatives gathered in Washington on 28 February, and Republicans in Congress during the debate over the stimulus bill have elevated to the level of mainstream discourse a conversation over the meaning of the terms “nationalization” and “socialism,” even if the purpose of such right-wing defenders of unbridled global capitalism is to induce ideological confusion and a sense of panic.
On 25 February, members of the House Financial Services Committee asked Fed Chairman Ben Bernanke to explain what he understood to be the definition of “nationalization.” In response, he said it is when “the government ‘seizes’ a company, ‘zeroes out the shareholders and begins to manage and run the bank.” He reassured the anxious Congressmen that “we don’t plan anything like that.”[1] Treasury Secretary Timothy Geithner seconded Bernanke’s comments, describing nationalization as “the wrong strategy for the country and I don’t think it’s a necessary strategy.”[2] Sen. Charles Schumer, member of the Senate Banking Committee, also tried to reassure a nervous investor class stating that a “federal takeover of the banks should be avoided at all costs. No one intends, ever, to have the government running these banks or insurance companies for a long period of time.” His goal, somewhat more ambitious than that proposed by either Bernanke or Treasury Secretary Timothy Geithner, is to have the government “come in, clean them out, take out the bad assets, put in new management.”[3] Despite such reassurances from those at the center of power, howls from the right and from brokers on the floor of the New York Stock Exchange and Chicago Mercantile Exchange continue to charge that the U.S. beginning under the Bush Administration and continuing at an accelerated pace is heading down the road to “socialism.”
None of the half-measures, abrupt shifts in policy, or tenuous interventions in the financial sector over the past year at least (Bear Stearns went under on 17 March 2008) have been effective at stemming the ever deepening global financial crisis. Banks continue to fail, large monopolistic financial institutions are reeling around the world, and the global economy is spiraling into perhaps its worst crisis ever. Events, as the recent contorted interventions to rescue Citibank have shown, are forcing the leaders of U.S. capitalism to make very difficult and, to them, unpalatable decisions. Neither former Treasury Secretary Henry Paulson (a supposed expert on the Great Depression of the 1930s) nor current Treasury head Tim Geithner (Governor of the New York Fed when Lehman Brothers went down in September 2008) appear to have to will to carry off what is historically necessary – the outright seizure of the major financial institutions of this country. This should not surprise us as they are “true believers” in the neo-liberal capitalist world order. For them, the current crisis is perplexing since it should not be happening at all. At the very least, the market should have shown the way out by now. This led former Fed Chairman Alan Greenspan to recently acknowledge before Congress that the theory to which he (along with Paulson, Bernanke, and Geithner) ascribed was “deeply flawed.” No such statement of contrition has as of yet come forth from Bernanke and Geithner.
Ultimately, many analysts believe that the U.S. government will have no choice but to nationalize some of the largest financial firms, including Citibank, Bank of America, and some large regional banks.[4] Nobel Laureate Joseph Stiglitz recently echoed calls from leading economists Nouriel Roubini and Nassim Taleb to nationalize the U.S. banks telling German television network Deutsche Welle “the banks have failed. Nationalization is the only answer.”[5] Stiglitz has much experience at the center of global finance having served as a member of President Clinton’s Council of Economic Advisors (1993-1997) and as Chief Economist and Senior Vice President of the World Bank (1997-2000). During those terms he witnessed the LTCM and East Asia currency crises (1996-1998) that some economists like Paul Krugman warned was a prelude to a global economic depression.[6] What has happened in the meantime is that trillions of dollars have been thrown down the bottomless chute of fundamentally insolvent institutions beyond hope of rescue.[7] Moreover, for all of this public money used to prop up badly run speculative private institutions not once has the government forced the management to resign (the recent move at Citibank showed the first signs of the Treasury making demands about the composition of corporate boards) nor has it called for any “claw back” provisions of the bonuses and extravagant pay for executives who ran their enterprises into the ground. Instead, public wealth is being transferred on a rapidly moving conveyor belt into the hands of unscrupulous and failed bankers. This is becoming one of the greatest thefts in world history. As Stiglitz told Deutche Welle, “separation of ownership from control is a recipe for disaster.”[8]
What is called for is an emergency solution not unlike that confronting Russia in the summer of 1917 when the Bolshevik leader V. I. Lenin wrote The Threatening Catastrophe and How to Fight It. In that pamphlet, Lenin described an unfolding crisis where the wheels of the Russian economy were grinding to a halt. Banks had ceased lending, railroads were shutting down, food supplies were dwindling, and unemployment was mounting. Lenin also noted that there was much public discussion among politicians and leaders of industry that something dramatic had to be done to salvage the situation. “Everybody says that. Everybody recognizes that. Everybody has agreed to that. And nothing is being done.”[9] Even more recently, Sweden’s experience in the early 1990s has been held up as analogous to the broad parameters of the current U.S. situation. There a housing boom in the late 1980s led to speculation on mortgage-backed debt that eventually ended badly leading to the government taking effective control of the largest banks. Sweden then forced the banks to create two institutions under one roof – a good bank and a bad bank. All of the “toxic assets” were concentrated in the bad banks, which gradually (over four years) sold them off.[10] The problem with using Sweden’s banking crisis as a model for understanding our own is that not only is Sweden’s economy a fraction of the size of that in the U.S. but its institutions are not at the epicenter of the global capitalist system. Institutions like CitiGroup, Morgan Stanley, Bank of America, JP Morgan Chase, Goldman Sachs, and others are global monopolistic enterprises with branches, partners, and subsidiaries throughout the world. Moreover, they are the vehicles through which the leaders of U.S. government pass on their way to political power. Consequently, there is an incestuous relationship between the “too big to fail” banks and the officials in charge of their oversight. There was nothing analogous in Sweden’s case. Finally, the U.S. crisis does not stem entirely from a decline in home prices (the much vaunted bursting of the housing bubble). Rather, for decades there has been a mounting structural weakness in the U.S. economy and by extension global capitalism. That is the overwhelming dependence for the survival and expansion of the system on debt of all kinds – credit cards, mortgages, auto financing, leveraged stock trading, and greatly expanded issuing of public debt of many varieties. Since the early 1970s there has been a widening disconnect between the real wages of workers in the industrialized world and the accumulation of public and private debt.[11]
We are at a crossroads in the current crisis. Every leading politician, pundit, and financial analyst acknowledges that the situation requires urgent action. On financial, ethical, and political grounds it is imperative that the U.S. government nationalize the major financial institutions, place them under federal control, unify them into one central bank to provide for more efficient management, and completely dispatch the executive management of those firms that have been seized. Only through that device can the process of daily pumping billions upon billions into dead institutions be stopped. Only through such bold moves can the government gain the leverage it needs to control the credit markets, make interest rates meaningful, and aggressively restructure mortgages. Only through the decisive action of seizing, controlling, and re-directing the functioning of the banks to serve the immediate and long-term needs of the people can the rate of decline be slowed and some stability be restored to the financial sector of the economy.[12]
This should not be confused with socialism. Such labeling is an effort on the part of those ideologues still committed to the failed neo-liberal policies of the Washington Consensus dating to Reagan and Thatcher years of the early 1980s to derail any meaningful assistance to those workers, farmers, and middle class people who are suffering because of the greed of the capitalist elite. Moreover, it is the same callousness that those practitioners of gung-ho capitalism displayed in guiding IMF and World Bank policies on a path to crippling and impoverishing developing countries around the world through “Structural Adjustment Programs.” Lenin clearly delineated the difference between “state monopoly capitalism” and socialism, but argued that it was imperative in the period of impending catastrophe that responsible officials of any government take the decisive measures necessary to save people from mass unemployment, famine, and deep social dislocation. That the global economic crisis portends widespread political upheaval has been attested to by analysts and researchers who work in Africa, Asia, and Latin America.[13] In describing the 1917 crisis in Russia, Lenin wrote that nationalizing the banks would improve “the accessibility and the easy terms of credit, particularly for small owners [and] for the peasantry.” Further, the state would “be in a position to survey all the main monetary operations without concealing them, then to control them, then to regulate economic life, and finally to obtain millions and billions for large state operations.”[14] This addresses many of the most salient aspects of the crisis in the financial sector: transparency, accountability, assistance for those who actually need it, saving funds that will be needed for further stimulus, and it resolves the fatal disconnect Stiglitz identified in the current approach between having ownership without control. Beyond the current crisis, though, since the capitalist ideologues have raised the specter of socialism in the U.S., it is an opportunity for progressive forces to intervene in the public conversation and offer a real understanding of what socialism is while also highlighting the ultimate flaws of capitalism that can never be overcome or resolved from inside the system. This is an historic opportunity for the government to act on behalf of the people to mitigate the effects of a dying system and for progressives to make the case for socialism. The fate of millions of people around the world depends on the abilities of both to do what is historically necessary.
[1] Craig Torres and Bradley Keoun, “Bernanke Rejects ‘Anything Like’ Bank Nationalization,” Bloomberg.com 25 February 2009.
[2] Robert Schmidt, “Geithner Calls Nationalizing Banks ‘Wrong Strategy’ for Economy,” Bloomberg.com, 25 February 2009.
[3] Torres and Keoun, “Bernanke Rejects ‘Anything Like’ Bank Nationalization.”
[4] Matthew Richardson, “The Case for and against Bank Nationalisation,” VoxEU.org, 26 February 2009.
[5] Michael Knigge, “Stiglitz: Nationalized Banks are ‘Only Answer’,” Deutche Welle, 16 February 2009. Reprinted in the People’s Weekly World.
[6] Paul Krugman, The Return of Depression Economics and The Crisis of 2008, New York: W. W. Norton, 2008.
[7] On 27 February Bloomberg Financial Group provided an assessment of the entire contribution made by the Federal Reserve and U.S. Treasury Department to prop up the financial system since the beginnings of the crisis in August 2007. Its conclusion was that to date $11.6 trillion has been either spent or taken on as liabilities in the process. This includes cash injections into the trading markets, the TARP and other emergency programs, loans to banks facilitating their takeover of other even worse off financial institutions, the seizures of AIG, Freddie Mac, and Fannie Mae, loans to the Auto Industry, and the expansion of the Fed’s balance sheet to facilitate the commercial paper market that seized in September and October 2008.
[8] Knigge, “Stiglitz: Nationalized Banks are ‘Only Answer.””
[9] V. I. Lenin, The Threatening Catastrophe and How to Fight It, New York; International Publishers, 1932, p. 5. The essay was written 23-27 September 1917.
[10] Edward Harrison, “Did Sweden Really Nationalize Its Banks?” online blog post, 25 February 2009.
[11] Federal Reserve Table 100.B Data for 1945-2005, published by AutoDogmatic.com.
[12] Binyamin Appelbaum, “What Is Nationalization? Depends Who You Ask,” Washington Post, 25 February 2009. See also Robert Griffiths, “Why Nationalization Isn’t Socialism,” Politicalaffairs.net, 3 November 2008, reproduced from the Morning Star.
[13] Nelson D. Schwartz, “Job Losses Pose a threat to Stability Worldwide,” New York Times, 15 February 2009.
[14] Lenin, The Threatening Catastrophe and How to Fight It. Italics in the original.
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