GuidoWorld

The last few posts have been dedicated to my explaining the type of people who frighten me and make me feel unsafe. What started out as an idea for a post of two has festered into a series. I hope to conclude this entire foray into my social demons in the next post.

In this blog I hope to quickly expand on my observation last time that “through taxing corporations, and the wealthy, cutting back military expenditures, and having prisons house only those that are truly a threat to the welfare of others we could quickly balance the budget and significantly reduce national and global debt.”

Okay, let’s start with taxing the wealthy and corporations. Our corporations are taxed at a historically low rate which comes in at a little more than 1% of GDP. If we were to temporarily raise it to a more normal 4% we would stand to gain between 500 and 700 billion dollars.

Individual tax rates for the wealthy are likewise at historically lows rates. In 1918 the top tier’s tax rate was 77%. From 1918 till 1964 the top tax rate went from as low as 63% to a high of 94% in 1945. The rate stayed above 90% from the mid 40’s till the 1964, almost two decades. In tax rate has drastically come down since the 80’s where it has languished to under 30%.

Just by raising the tax rates of the top 1% to a historically modest 50% we could easily raise an additional 50 to 70 billion in revenues. Therefore, through returning tax rates to rates more in line with the historical norm we could raise between 700 and 800 billion dollars. Compare that with the paltry 38 billion that Democrats and Republicans argued over to within an hour of a governmental shut down.

The revenues by taxing the wealthy are more than matched by the savings one could acquire by making cut backs to our defense budget and military operations. The following is from an article from the nation.

Dreyfuss writes, President Obama’s own National Commission on Fiscal Responsibility and Reform(NCFRR) pointed out the $80 billion the U.S. spends on military R&D alone “surpassed China’s entire military budget by more than $10 billion.” Overall, Dreyfuss writes, the U.S. spends as much on military “as the rest of the world combined.”
What’s more, the Pentagon’s trillion dollar spending spree exceeds the general funds of all 50 U.S. states combined, which, says the National Association of State Budget Officers, will come to about $636 billion in 2011. Translation: Pentagon spending for war is greater than all public outlays for all purposes by all states. And while hard-pressed states wallow in debt and lay off teachers and police, “defense” contractors enjoy record or near-record profits.

Couple these disturbing and obscene facts with the following data by Dana Visalli from Global Research.

Global Research, April 18, 2011
A recent study indicates that 62% of soldiers returning from the war in Iraq have asked for mental health counseling, with 27% showing dangerous levels of alcohol abuse. Suicide rates among soldiers and vets have increased dramatically in recent years. Over 100,000 Vietnam vets have now killed themselves, far more than died in the Vietnam War. More than 300,000 veterans of the U.S. military are currently homeless, another study reveals.
The total cost of all military expenses for 2012 is estimated to be $1.2 trillion dollars, one-third of the total federal budget. It is the U.S. military that is driving the U.S. itself into bankruptcy.

The above article also points out that the US has over 1000 military bases spanning the globe.

I entitled this post Over Kill in homage to our defense budget and its global ambitions. We are years if not decades ahead of any other nation on earth. China who is second in the world in terms of military budget spends around 1/10th on defense as does the US. Even if we were to cut our military budget in half we would still be spending 5 times as much money on defense as any other nation. By cutting our defense budget it would still be more than we were spending on defense a decade ago, when we were still the world’s military superpower with no equal.

Since the military is 1/3 of our budget cutting the defense budget in half would reduce our budget by anywhere from 15% to 20%. Yet, cutting back on the military would reduce so many other national and international costs.

I included the stats regarding suicide, mental health and substance abuse to highlight some of the hidden costs both human and financial to our current military. One could also add on to this list, physical disabilities, rape and violent crime, medical care as well the costs of all the damage done to land, crops, buildings and infrastructure caused by bombs, chemical agents, tanks, guns, disease and all the other accouterments of warfare and military maneuvers.

The last costly sector I mentioned in the previous post was in imprisonment and corrections. Even though a disproportionate percentage of violent crime is performed by veterans who are suffering from PTSD or have other issues making their reintegration into civil society difficult, the overall rate of violent crime has been coming done over the last few decades. The overwhelming majority of people imprisoned today are for non-violent crimes such as recreational drug usage, vandalism and petty theft. The costs to the economy that these people pose is often times far less than the amount of tax money involved in the costs of imprisonment (i.e: food, shelter, clothing, correction buildings, supervision, health care, assistance to families, lost productivity, etc.).

In a previous post Need A Job – Get Arrested I discussed the underground economy of prison labor and its growing role in taking away jobs and reducing the wages for those of us not in prison. Prison labor is one of the hidden costs to the average tax payer in that work done for 25 cents an hour takes away jobs for some and reduces the wages for others who work for companies having to compete with prison labor.

In expanding on the social costs of the military one could add the dollars lost due to the mental and physical disabilities of a sizable percentage of veterans. In an aging population an increasing economic burden is placed on our youth to be more productive. Yet, for those struggling with war injuries both mental and physical the reality is that they find consistent employment hard to accomplish.

In review we found that substantial but safe and not historically harsh cuts in the military and taxes of corporations and the top 1% could total some 1.3 to 1.5 trillion dollars. In other words just those two action on a one time basis could balance the budget and probably begin the process of paying down the debt. If you were to raise the taxes on the 10% or make our defense budget only two to three times other nations we could stop all the talk of the need to attack social security or other obligations that workers pay has been used for.

The savings acquired by reducing a sizable portion of our non-violent prisoners and the positive impact reducing our military forces would have on employment, mental health, violence, crime and stable marriages for those not traumatized, killed, or debilitated by exposure to war, would probably be more than the 38 billion dollars that almost brought our government to a screeching halt.

Some may argue with my numbers. I myself could make a case both for higher and lower numbers on what I’ve suggested. Some also will try to say that these suggestions are reckless and would destroy our economy and our safety. First I would strongly disagree with these objections and consider them self-serving for the perception managers whose wealth depends on the status quo. Second, I would want to point out that we could always repeal these measures if they started to manifest any unforeseen complications or downside. Yet, in the short run we could finally put on the table some solutions that could actually have an impact on the sort of deficits and financial imbalances which we now face without a need to punish the already overwhelmed and underpaid 95% of US citizens.

Jim Guido

I have lived a frugal life, making little but spending even less. I never incurred debt other than a mortgage and I paid that off as quickly as possible. My wife has been a good bread winner and “went without” a number of years to help us stay out of debt and save for the future. Though we saved we still are far from being able to retire comfortably even if we were to receive the majority of what we paid into social security.

Our long term retirement plan has suffered due to a lengthy restriction on the average person’s ability to save money. The game has changed drastically over the last few years as we see our relative wealth diminish on a daily basis.

A little over a decade ago my wife and I felt we were in great shape. We had paid off our mortgage in about 1/3 of the time it was suppose to take, saving us hundreds of thousands of dollars. (When we realized that the interest on our 30 year mortgage would have caused us to pay over $400,000 for a 130,000 home we payed it off as quickly as we could, thereby, paying about 150,000 instead of 400,000).

After paying off our mortgage we continued to put all we could afford into savings and retirement plans. Soon, we got to a point where through the miracle of compound interest we could basically stop saving and just let our “equity” build through interest. During my life bank and CD rates generally ran between 5 and 8% with peaks of near 18% and lows down to about 3%. Due to this historic range we made our plans based on expectations of averaging a modest 5% per year.

Around this time our son started college and we did our best to pay for his education without borrowing money or taking money out of our nest egg. Yet, towards the middle of his college years and since it has been impossible to save money due to the historically low and historically prolonged low interest rates. This has caused our nest egg to stop growing and linger at a range far below what we need to retire on.

Like many American’s our retirement needs have kind of forced us into taking money out of CD’s and money markets and into the stock market. Statistics show that over 80% of the people who actively invest in the stock market lose money. Considering this recent fact of the stock market of the last decade or so, we have done well to stay at or slightly above the flat line.

Wealth is relative, and a hundred dollars today is worth far less than a hundred dollars of a couple of decades ago. Therefore, due to inflation, unless you’re net worth is increasing you are becoming poorer. Yet, in today’s economic environment we are dealing with more erosion to our wealth than standard inflation.
When trillions of dollars are being printed and entered into our economy we either get our portion of that money or we are becoming poorer. Since the Federal Reserve is not sending you a check every day they print money you can safely assume you are getting poorer.

The truth of the matter is very few people are getting any part of the trillions of dollars being poured into the economy. In theory, the printed money is supposed to go to banks and businesses who will use that money for loans and businesses expansions leading to more high paying jobs which will “stimulate” the economy and the additional wealth will “trickle down” to the majority of people in society.

The majority of newly printed money going to banks is not being lent out to the average citizen who is finding it harder and harder to get a loan. And the majority of businesses who are getting this money through bailouts or loans are not using it to create new jobs or expand their operations. Businesses are reluctant to increase production or raise inventories when consumers are in debt, bankrupt and in danger of losing their homes.

Well then, you may ask, where are these mind boggling amounts of money going? There are a number of huge corporations and billionaires who are reportedly hoarding or “sitting on” cash. Yet, despite a slow growth economy with a high unemployment rate how are corporations claiming record profits?

Here is one possible explanation. Okay, lets start at the beginning. If I am a bank or a large corporation I can borrow money for shorter durations at anywhere from 1% to as little as 1/4 of 1%. Even for loans of a year or more I can borrow it at ridiculously low interest rates.

Now, I can take that money, and use it up by expanding operations and hiring workers, or I can use that money to buy other nations bonds that are paying 5% for the same amount of time that I’m borrowing it at around 1%.

Okay, so if I expanded my business and hired additional workers I would increase my overhead and would be in danger of losing money or failing if the economy didn’t pick up or if people chose to pay off their debt instead of buying my products. So, unless the entire economy picked up, I would probably stand to lose money and not be able to pay off my loan even considering its low rate. And, if most people except the biggest corporations are being denied loans then I can be reasonably assured the general economy is not going to bounce back, and I will not get a return on my investment.

Yet, if I take a loan for 1 million at 1% and I use it to buy a bond for the same duration earning 5%, than I can use the 50,000 of interest to pay off the 10,000 of interest I got from the bank, and claim the remaining 40,000 as profit. Like a good shampoo, you can lather and rinse over and over again. As, long as there are countries with higher interest rates than the US I can borrow money from the US and buy other nation’s or even businesses bonds and make a sizable profit.

Summarizing this process so far, by borrowing money at low rates and buying financial instruments with higher interest rates I can generate a significant profit margin. During this time I can keep operations relatively flat, keeping overhead down by producing the same amount of products with the same number of workers. So, despite no actual growth in business I can make greater profits.

Yet, for a corporation willing to do this, the good times don’t end there. Shortly before I announce my excellent rise in profits to the media, I can increase the number of shares I own and sell those shares soon after the market’s positive response to our business growth. I can explain this growth through some obtuse combination of increased foreign consumption, stealth growth in the local economy, and some good news in “the pipeline”.

In a world of low interest rates, mounting consumer debt, and the practice of trying to avert recessions and financial crises through the endless printing of money, it becomes possible and even logical for businesses to seek to remove consumers from the business equation. For those of you skeptical that what I’m describing is happening, I would encourage you to look back at the performance of the stock market on days in which the Fed made statements inferring that low interest rates were continuing or that data came out showing a need for low interest rates.

My theory also could end the confusion of you market watchers who have been baffled by how often the market skyrockets on the day real poor economic data is reported. Interest rates will stay low as long as the economy struggles. Oddly enough a true economic recovery would probably destroy the impressive stock market rally that has been occurring over the last two years since the “economic crisis” was “solved” by the beginning of bailouts and “quantitative easing”.

Yet, even if my theory is a bit off or its use exaggerated, there is no doubt that the bulk of the money being printed is finding its way into the hands of a very small fraction of the populace, who already own a disproportionate percentage of our nations wealth. It is also safe to state that this money is not filtering down to the rest of us. In fact, it is safe to say that each day the gap between the rich and poor is widening, and that the American middle class is shrinking and we are fast becoming an economy which we would have previously considered to be third world.

We, the majority of Americans, are truly becoming poorer by the day.

In my next post I’ll combine these ideas with the previous two posts regarding people who scare me to describe why I think we need to look at systemic change that needs to look beyond the Democratic/Republican theater which is being used to distract, divide and confuse the populace.

Jim Guido

Recently I saw the Michael Moore documentary “Capitalism: A Love Story” and was shocked to see footage of FDR outlining a Second Bill of Rights during his State of the Union Address in 1944. How could a president have proposed this and I never heard of it?
Here is Wikipedia’s summary of this proposed legislation.

The Second Bill of Rights was a list of rights proposed by Franklin D. Roosevelt, the then President of the United States, during his State of the Union Address on January 11, 1944. In his address Roosevelt suggested that the nation had come to recognize, and should now implement, a second “bill of rights”. Roosevelt’s argument was that the “political rights” guaranteed by the constitution and the Bill of Rights had “proved inadequate to assure us equality in the pursuit of happiness.” Roosevelt’s remedy was to declare an “economic bill of rights” which would guarantee:

Employment, with a living wage,
Freedom from unfair competition and monopolies,
Housing,
Medical care,
Education, and,
Social security

Excerpt from President Roosevelt’s January 11, 1944 message to the Congress of the United States on the State of the Union[1]:““It is our duty now to begin to lay the plans and determine the strategy for the winning of a lasting peace and the establishment of an American standard of living higher than ever before known. We cannot be content, no matter how high that general standard of living may be, if some fraction of our people—whether it be one-third or one-fifth or one-tenth—is ill-fed, ill-clothed, ill-housed, and insecure.
This Republic had its beginning, and grew to its present strength, under the protection of certain inalienable political rights—among them the right of free speech, free press, free worship, trial by jury, freedom from unreasonable searches and seizures. They were our rights to life and liberty.
As our nation has grown in size and stature, however—as our industrial economy expanded—these political rights proved inadequate to assure us equality in the pursuit of happiness.
We have come to a clear realization of the fact that true individual freedom cannot exist without economic security and independence. “Necessitous men are not free men.”[2] People who are hungry and out of a job are the stuff of which dictatorships are made.
In our day these economic truths have become accepted as self-evident. We have accepted, so to speak, a second Bill of Rights under which a new basis of security and prosperity can be established for all—regardless of station, race, or creed.
Among these are:

The right to a useful and remunerative job in the industries or shops or farms or mines of the nation;
The right to earn enough to provide adequate food and clothing and recreation;
The right of every farmer to raise and sell his products at a return which will give him and his family a decent living;
The right of every businessman, large and small, to trade in an atmosphere of freedom from unfair competition and domination by monopolies at home or abroad;
The right of every family to a decent home;
The right to adequate medical care and the opportunity to achieve and enjoy good health;
The right to adequate protection from the economic fears of old age, sickness, accident, and unemployment;
The right to a good education.
All of these rights spell security. And after this war is won we must be prepared to move forward, in the implementation of these rights, to new goals of human happiness and well-being.
Americas own rightful place in the world depends in large part upon how fully these and similar rights have been carried into practice for all our citizens.
For unless there is security here at home there cannot be lasting peace in the world.”

If you go to You Tube you can see the footage and hear the address for yourself. This footage was supposedly lost for a number of years and was only recovered in 2008.

In my last post I discussed the significant role perceptual management has played in the US over the last 100 years. The desire of our government and corporations to persuade us to act and think in ways which preserves and enhances their power and wealth may help explain the fact that though I was born a little more than 11 years after this address, I never once heard of it during all my years of education.  Anyone saying these words today would be labeled a socialist or communist and could easily be labeled a terrorist and an enemy of the state.

Our perceptual managers lead us to believe that the American middle class has been the envy of the world for generations. Yet, the reality of the fact is that the American middle class is (was) a short lived phenomena with the bulk of American economic history having almost all of its wealth hoarded by a privileged few. Our current disparity of wealth and the destruction of the middle class has been the norm and not just a recent occurrence.

Here is an excerpt from, “The Global Economic Crisis: The Great Depression of the XXI Century” by Andrew Gavin Marshall which I read today @ the Global Research on line at http://www.globalresearch.ca/index.php?c….

Throughout much of the 1800s and into the 1900s, the United States suffered several economic crises, one of the most significant of which was the Great Depression of 1873. As Howard Zinn explained:

The crisis was built into a system which was chaotic in its nature, in which only the very rich were secure. It was a system of periodic crises – 1837, 1857, 1873 (and later: 1893, 1907, 1919, 1929) – that wiped out small businesses and brought cold, hunger, and death to working people while the fortunes of the Astors, Vanderbilts, Rockefellers, Morgans, kept growing through war and peace, crisis and recovery. During the 1873 crisis, Carnegie was capturing the steel market, Rockefeller was wiping out his competitors in oil.[32]
Massive industrial consolidation by a few oligarchic elites was the rule of the day, as J.P. Morgan expanded total control over railroad and banking interests, and John D. Rockefeller took control of the oil market, and expanded into banking. Zinn explained:
The imperial leader of the new oligarchy was the House of Morgan. In its operations it was ably assisted by the First National Bank of New York (directed by George F. Baker) and the National City Bank of New York (presided over by James Stillman, agent of the Rockefeller interests). Among them, these three men and their financial associates occupied 341 directorships in 112 corporations. The total resources of these corporations in 1912 was $22,245,000,000, more than the assessed value of all property in the twenty-two states and territories west of the Mississippi River.[33]
In the early 20th century, European and American banking interests achieved what they had desired for over a century within America, the creation of a privately owned central bank. It was created through collaboration of American and European bankers, primarily the Morgans, Rockefellers, Kuhn, Loebs and Warburgs.[34]

US history shows a marked tendency towards the systematic fleecing of all wealth from its citizenry to the economic elite than towards a spreading of the wealth and standard of living for a growing middle class. The short lived gains in the standard of living enjoyed by a burgeoning middle class can be explained by two factors.

Initially the middle class was formed as a beneficiary of the incredible wealth and power the US acquired as a result of the two World Wars. A temporary rise in wealth, opportunity and education engendered the necessary loyalty and productivity required to build the most powerful empire the planet has ever known. Second, the creation of a consumer class was needed to fuel the continued growth of industry and technology allowing the military/industrial complex to thrive and police the entire globe.

Yet, the actions and decisions of both the government and corporations shows that they never truly planned on honoring their contracts with the American middle class (i.e.: pension funds, social security). The role and need of the consumer age is on the decline. In its current phase the role of the American consumer is being diminished as the role of the global consumer increases. Yet, in a nanotechnological global economy dominated by artificial intelligence, virtual reality, and increasingly abstract financial instruments the need for actual consumption becomes less important to power and wealth.

My read of history is that the American middle class was largely created and exploited for the purposes of empire building. My read is also that the American and European middle class has largely served its purpose and is no longer necessary. No longer needed as consumers we are being prepared to return to our historical role as serfs and slaves.
If my gut is right on this, we should be very close to the next Great Depression which will attempt to ring the middle class out of all societies throughput the globe and consolidate all international wealth and ownership to a frighteningly small number of individuals.

Perceptual management is a science and a fact of modern life. Yet, the gift of perceptual managers is their ability to divert people’s attention from what is really going on. The talents of perceptual managers and propagandists is evident in the fact that most people still believe in the American dream and the integrity and honesty of government and business.
In our perceptually managed society anyone asking questions or making logical conclusions that pose a threat to the heart of their deception will successfully be labeled a conspiracist or an extremists. Yes, I know extremists and conspiracists are real, but so are spin doctors, propagandists and perceptual managers.

Jim Guido

Capital is defined as wealth in the form of money or other assets available for a particular interest such as starting a company. Another definition of capital is the excess of a company’s (or person’s) assets over their liabilities (or debts).

The entire system of capitalism is based upon an individuals ability to amass capital through asset accumulation, excess profit, investment and savings and then use that capital in business enterprises which will generate additional profit. A profit is generated when the money made from the enterprise exceeds the operating expense of the enterprise plus the original capital needed to begin the enterprise.

The system of capitalism is dependent on capital and a successful capitalistic society would be one in which a growing or at least sizable portion of the populace were able to participate in the system by being successful capitalists. One of the major ways of evaluating the success of capitalism is by seeing how frequent capital is generated by the economy.

Recently I read an article on Counterpunch.com by Bill Quigley which cited some interesting statistics regarding how the US money pie is divided up and the amount of assets (capital) people in the US actually have. Take a moment a digest the following facts.

First, there are 43 million people in the US living under the official poverty line.

The bottom 20 per cent of the US population have negative wealth, they owe more than the value of all their assets.  From 20 to 40th percentile, the next 20 per cent of the population, average about $5,000 in wealth.  The middle 20 per cent, from the 40 to 60th percentile, own $65,000 in assets.  The next highest 20 per cent, the 60 to 80th percentile, are worth about $208,000.  From 80 to 90th, the average wealth is $477,000.  From 90 to 95th, the wealth is $908,000 in assets.  From 95 to 99th is $2,734,000 in wealth assets.  And the top 1 per cent?  $13,977,000 in average wealth.

Okay, let’s reflect on what this means and what it says about US capitalism. First, one out of every 5 people (20%) have more debt than assets, and even if they were to sell everything and completely liquidate they would still be in the hole. So, to start with 20% of the people living in the US have zero capital, even if they were to sell everything they own. It is interesting to note that only 14% or so of people are officially recognized as living below the poverty line, which means at least 6% of people with negative net worth are technically not considered to be impoverished.

Next interesting thing to note is that the next 20% average a little over $5,000 in assets. This again means that those in this bracket would have a little more or a little less than five thousand dollars if they were to sell their, house, car, furniture, clothes, tools, and family keepsakes. What the hell could a person with no food, shelter, clothing, transportation or communication devises due with 5,000 dollars?

In terms of capitalism $5,000 dollars in our current economy is not much different than being penniless. You can’t get a loan with $5,000 in assets and what prospect would you have with no car, house, etc.

So, one can easily say that 40% of US citizens do not have any means of participating in modern capitalism. At best they can aspire to being indentured servants. When you consider how destitute the bottom 40% of the populace is in the US it is amazing that our crime rate is not higher than it is. Even though we have the highest per capita prison rate in the world (a little less than 1/2 of 1%) it is astounding that more of this 40% is not turning to crime. In fact, one could make an argument that crime is more prevalent in the wealthiest 20% than in the bottom 20%.

Another way of looking at these facts is to note that over 120,000,000 million US citizens have little or no assets or capital. Now, how could these people go about amassing capital?

Well, as just noted a couple paragraphs above, these 120 million people would not be able to qualify for any legitimate bank loan. Even though cutting down on expenditures sounds like a good idea there are a couple of problems with this tactic. First, since interest rates are at historic lows your money will not grow and therefore, not even keep up with inflation. Also, the more people cut down on consumption the harder it will be for businesses to survive resulting in more and more job losses. Therefore, the very people most in need of improving their financial situation will be the first let go in the ever rising unemployment environment.

How can one say that capitalism is succeeding when 120,000,000 people are essentially left our of its possibilities? To those who counter that some of these people could become wealthy due to a artistic or athletic talent, or through some other form of creativity or ingenuity I would want to point out that the small amount of people able to benefit from this form of talent lotto will not change the 120,000,000 figure. There are not enough high paying pro sports, music and literary contracts, or creative inventors to put a dent in the 120,000,000 figure. In fact, many potential inventors and creative entrepreneurs are dependent on finding “angel” investors or benefactors in order to raise the necessary capital to begin their venture.

The data regarding relative wealth does not include money owed the government due to the national debt. Much of our national debt is hidden, but even reportable debt comes out to about 25,000 per person. When you factor that in even the asset level of the next 20% become suspect when thinking of it as actual capital.

The reality of the situation is that we are bailing out banks and mega-corporations due to their being “too big” and too important to fail. While it is true that these businesses are struggling the statistics above clearly show that officers and high level employees at these institutions are awash in capital.

While the bottom 40% have only 30 or 40 billion in assets the top 1% have over 42 trillion. Okay, doing the math it means the top 3 million earners, are making some 3400 times the assets (capital) as the bottom 120 million. Many of these so called earners just happen to be so wealthy due to being related to, living with, or being the child of someone with wealth. And even many of the primary earners may not have ever worked a day in any meaningful fashion. The best and the brightest is often a euphemism for the most ruthless and exploitative.

In the early days of capitalism one could acquire assets and capital through luck and adventurism. In the US the moving west and claiming land could result it substantial asset growth through acquiring highly fertile farm land, or great timber, or land sitting atop mineral, oil or any other natural resource able to be adapted to the industrial revolution.

Yet, those days are long gone. Most of what can be owned is now owned. No longer can you strike out into a virgin area and acquire capital, now you need sizable capital to purchase assets. Everything has become a commodity to be owned, every bit of water and air has some kind of claim on it, even concepts are now owned.
More and more capital is filtering down to fewer and fewer people.

The total amount of government and business debt in this country is beyond the conceptual abilities of most people. Yet, this obscene and unimaginable amount of money still understates the problem for it doesn’t include government and business “obligations” such as social security and pension plans.

One has to wonder if you subtracted all personal, governmental and business debt (including obligations) from all the assets of our nation how much capital would actually remain. One has to wonder if its just the bottom 20% of the US that has no capital, or if the entire capitalist system is without capital.

From a purely logical standpoint it would make sense that all assets have a specific value at any given moment. The total amount of capital could be calculated by multiplying all resources and goods by the current price of these resources and goods. In this way the system remains somewhat stable and closed even though it expands and contracts by shifts in volume and price.

Yet, theoretically the system becomes unstable once the concept of debt and interest are introduced. Debt is neither a good nor a resource. While debt through loans may increase capital and economic success in a given project or for a specific person, it detracts from the overall capital in the system. This explains how we can have so many goods and resources yet have actual negative cash flow and capital. From a systemic perspective our wish to bailout out and stimulate the economy through increasing borrowing and the printing of money (both debt activities) will only decrease our overall real and functional capital.

I acknowledge that I may be misrepresenting or overstating some of the economic dynamics between debt and capital but I want to end with a couple of examples which support the practical possibility that debt exceeds capital in our society. First, the number of printed dollars in the US is a micro-fraction of our total debt. Second our yearly GDP which tracts the total amount of money generated by all the economic activity over the entire year is once again dwarfed by our amassed debt.

Another fact difficult to ignore is that each and every day that our debt grows the number of creditors lessens while the numbers of those in debt expands. It is hard for me to imagine that our current policies of debt expansion will in the long run lessen our debt problems or salvage the role of the majority of people as participants in capitalism.

I for one still believe that capitalism has been a beneficiary rather than the cause of the last century of relative wealth. Our mistaking the actual causes of the improvement in standard of living and quality of life experienced by millions of people and falsely equating it with free market capitalism may actually cause a noticeable regression in both quality of life and standard of living for many of those who had benefited from it.

Jim Guido

I feel that Capitalism is often given too much credit for causing the growth in the standard of living and quality of life that many in the industrialized world have experienced over the last century or so. Though admittedly it has at times played a significant role in these areas, it has also been an impediment to progress as often as has been a cause of improvement in the quality of life.

One mistake often made is to equate capitalism with the industrial revolution, where in truth the industrial revolution made modern capitalism possible. I would be more comfortable saying that capitalism has been a beneficiary of the industrial revolution rather than a cause of it.

The following excerpt by a blog written by Richard K. Moore will emphasize the relationship and distinction between capitalism and the industrial revolution.

“A new way of creating fortunes had been born. Instead of slowly amassing wealth over a lifetime, or risking a voyage in search of treasure, there was now a systematic way to amass wealth relatively quickly.  A person with money to invest could seek out the latest leading-edge inventions, develop a still-more efficient factory – and steal market share from his now-outdated rivals.  A way had been found to use money to transform initiative & innovation into wealth. Out with the old methods, in with the new methods – and behind it always the investor – driving the process while amassing a fortune. This method of amassing wealth was eventually given the name capitalism.  A capitalist is someone who invests money in an enterprise with the objective of receiving more in return than was invested.”

A capitalist was originally one who invests money in the technology of the industrial revolution in order to make more than he invested (ie: make a profit). What this is essentially stating is that a person becomes a capitalist by first acquiring capital by savings, inheritance or borrowing and then by investing that capital into new ventures promising additional profits.

A capitalist is one who has or acquires surplus money to fund an enterprise. Once beginning the business he uses advanced technology (mass production, automation, etc.) and human labor to under price and outperform his competitors, gaining in increased market share and additional capital to invest in more ventures. The cheaper the human labor employed, the greater the opportunity for increased profit margins available to him.

So to recap in capitalism those who have an inherent economic advantage over someone else can use capital to increase their economic success through increasing the disparity between themselves and their competitors. Likewise they will gain an increasing economic disparity between themselves and anyone they employ.

The entire process of capitalism is fueled by and dependent on a process of increased disparity with a greater percentage of wealth going to fewer and fewer people. Capitalism is inherently a very competitive system with each transaction involving a relative winner and loser.

Seen from above you could track capitalism like a sports tournament whereby each participant who wins advances to the next round where the loser either goes home or plays in a consolation contest in the losers bracket. Even though a person who loses today may win tomorrow, over time a general trend emerges whereby every sector is dominated by one or two winners. Losers either become lesser pawns in another’s business or tries their luck in another emerging sector or new technology.

Yet, let’s be very clear here the advances in overall social wealth and standard of living are not caused by successful capitalist or their companies but rather by the inventions and technology they employ in their business. Many of the best inventors, innovators and influential minds have never been capitalists or even wealthy.

Though capitalism may be the mechanism by which many beneficial practices, medicines, inventions and technologies have been introduced into society they have rarely been the cause. Many past societies and eras saw great technological progress and improvements in the quality of life without capitalism. We recognize Egypt, Ancient China, the Greek and Roman Empires, the Ottoman Empire and the Italian Renaissance, (to name a few) for their positive technological and practical impact on the life of men.

Even Capitalism as a system has had its own share of times and events which have made the life of almost everyone more difficult and painful. The US often has a tendency to refer to itself as the beacon of capitalism and its positive effects on the standard of living of a majority of its citizens. Yet, the economic progress and improvement in the American standard of living has been anything but linear.

Almost the entire US history has been capitalistic and a product of the industrial revolution. Until recently the US economy has been dominated by the so called business cycle, where over a four year period the economy would have a boom followed by a bust. Now some would say that the majority of these recessions were minor blips on the road to progress, yet that would minimize the suffering many people endured. Yet, no one can deny the fact that economic depressions have long term consequences which can destroy lives for generations. The US had depressions in 1807, 1837, 1873, 1893 and 1929-1939.

I would like to backtrack a little and talk about the ways in which capitalism in the US in particular benefited from inventions and resources which may highly exaggerate capitalism’s ability to generate wealth and a higher standard of living for its citizens. A new virgin land held many benefits for a capitalistic system.
There was a seemingly endless supply of land which was viewed as instant capital. At that point in history land ownership was equated with wealth and position and owning land gave you opportunities others did not have. In the early US, only land owners could vote and therefore, only land owners were citizens and fully protected by the law.

Much of this land was rich in one way or another. A good portion of the land was far more fertile than Europe or the East. Farmers were able to acquire fertile cheap land and almost free labor (slaves). Much of the land was covered with rich forest land which could be used for fuel, construction and materials. The land was also rich in minerals which came in handy for the burgeoning technology of the industrial revolution. The varied and plentiful wildlife made fur trading and fishing important industries.

All in all from a resource point of view the US was a veritable Garden of Eden. Any industrialized economy would have flourished in these circumstances. Yet, despite all these riches the US still suffered through economic hard times and depressions. Not only that, but capitalism helped made sure that a relatively few people amassed the bulk of these natural riches and their benefits.

We all have heard stories about the Wild West, but one seldom reflects on the fact that almost every part of the US was a wild west at one time. Pioneers were always pushing further west, and each new thrust revealed a new wilderness to harness and exploit. Without much organization to towns their was little organized law or governance. The ambitious and ruthless had the inside track at becoming successful capitalist while the meek, weak, careful and kind were destined to a hard life where whatever they acquired or earned could be taken from them with little or no recourse. The term “robber barons” was not created in admiration for these early capitalists.

The ruthless could claim land that wasn’t theirs, harm or kill workers that objected to their terms and harm, kill or steal from competitors that didn’t have their stomach for immoral greed. The resources were there for all, but capitalism and a lack of regulations ended up giving mastery of it to but a few. One would be hard pressed to present a case that capitalism improved the standard of living for most pioneers during the first century of American life.

The true birth of the American middle class and the glorious rise in the standard of living for the masses began in the late 19th and early 20th centuries. Inventions in farm machinery and agriculture did make farm labor more tolerable, yet at the same time put many people out of work. This forced many to the slums of the cities to find work in the emerging factories of mass produced goods. Yet, even these people experienced some of the benefits of electricity and coal in protecting them from harm and the harshest elements.

As the industrial revolution progressed capitalists began to need a consumer class to purchase all the goods and products being mass produced. Business leaders such as Henry Ford realized he had to pay his workers enough so they could afford to purchase the cars he was manufacturing. Quickly American capitalist learned that they could make two pennies for every penny they paid their worker, and make even more when their workers showed corporate loyalty by buying the products of the company they worked for.

Yet, the dramatic growth in the middle class came during and following the war years. The US was the major lender during the war years and reaped the benefits of this investment after the war. While other nations borrowed, lost civilian and military lives, and endured severe destruction to their homes and land, the US sat relatively isolated from the skirmishes and gained far more than it lost.

The US emerged from the war as the last man standing, and in relatively good financial position. The next few years saw the US take over the baton of empire from its European brothers. Russia, though suffering more damage and casualties than any other nation during the wars, became the US’s foil during its empire building years, due mainly to the fact that it offered communism as a challenge to capitalism.

The American middle class soon mushroomed out of capitalism’s growing need for a consumer class. The factories for war planes and munitions soon gave way to factories for washing machines, refrigerators and a host of conveniences whose profits stuffed the wallets of America’s new capitalist heroes.

As the US emerged as the empire it gained access to, if not control of, almost all of the world’s resources treating every nation’s assets as its own. The US populace which initially was opposed to involvement in both world wars was not excited about getting into the additional conflicts needed by an empire wanting to maintain and expand its influence.

One has to wonder how much of the rise in the standard of living of the American middle class was used as an incentive and bribe to gain their allegiance and support for the US’s empire building military actions. The USSR whether by design or good fortune was the perfect dupe to help galvanize the support for both capitalism and US empire aspirations.

Yet, even before the fall of the USSR the needs of capitalism began to outgrow the spoils of empire. Even with the entire globe’s resources and wealth at our disposal capitalism began to sputter threatening both the existence of the American middle class along with the continued fiscal expansion of our wealthiest capitalists.

Despite all the world’s resources and an endless stream of new technologies capitalism needed more fuel to sustain its momentum. So, in the 1980’s the US economy need for borrowing money to insure enough capital for further expansion increased. Over the last three decades the need for capitalists and governments to borrow and print money in order to keep the entire capitalistic system afloat has skyrocketed. Now, it takes something like $10 of borrowed cash to generate one dollar of profit. Obviously, not a good ratio.

Not only have the disparities inherent in the very mechanics of capitalism reached ridiculous levels where owners make thousands more per hour than workers, but the standard of living of the American middle class is tumbling. Yet, the multinational corporations are no longer dependent of a wealthy American middle class to sell their wares to, now they have 6 billion potential customers instead of 350 million.

In fact a sharp decline in the wages and standard of living of the American and European middle class will only help quicken the dream of a global economy. In the global economy which George Bush 1 more aptly called it “the new world order” you will have the ultimate capitalistic system whereby a few own almost everything and all workers earn about the same.

The majority of American’s will most likely tolerate and even support this logical unfolding of capitalism as long as they continue to falsely credit capitalism with our previous improvement in the quality of life and standard of living. The future of automation, artificial intelligence and nanotechnology considerably call into question the need for most workers, and if everything is owned and hoarded by a few trillionaires than what need will we then have for consumers.

I contend that increased disparity is inherent in modern capitalism, and the logical conclusion of increased disparity is a world of a few power lords and a planet full of subsistence living serfs. I’m not predicting this, I’m only pointing out that this is the logical outcome if we were to play out the path we are currently on.

Jim Guido

Though the stock market has rebounded and the recession officially ended well over a year ago most people agree that the US economy is not in good shape. The remnants of the financial crisis and the “great recession” still linger as does a healthy amount of skepticism that things have actually improved.

Pretty much everyone is in agreement that the US is drowning in a sea of debt. Between consumer debt, government debt and residential and commercial mortgage debt it is pretty obvious that the entire economy is in peril of becoming bankrupt and unable to make their payments.

Likewise most people also agree that the job market is poor and too many people are unemployed or underemployed. Many point to the loss of manufacturing jobs to emerging nations as a root cause of the lack of jobs in the US.

The solutions to these problems fall into two camps. One camp focuses on the debt problem and feels that the consumer needs to act in fiscally responsible manner and pay off their credit card and mortgage debt. A majority of these people also feel that the government needs to curtail its debt and balance its budget. Often these same people claim that government is too big and too powerful and that its interventions only interfere with the free market system healing itself.

The other camp focuses on the poor job market and believes the US economy is in need of stimulus to get its economy functioning again. This crowd generally favors giving tax breaks to small and large businesses so that they have the funds to expand businesses, hire employees and successfully compete in the global economy. Many of this crowd also feels bail outs and stimulus packages may be necessary to stave off crises and create a business friendly environment enticing businesses to stay in the US and employ its own citizens. Leaders of this camp state that the only through printing more money can we have enough to pay off our debts while helping fund businesses to expand and hire new workers.

I myself have always been a frugal person who has viewed debt and the borrowing of money as reckless and not very smart. Yet, this does not prevent me from seeing the flaws in the paying down the debt solution offered by that anti-debt camp. Since wages in the US have not and show no signs of skyrocketing the only way for most consumers to reduce their debt is through saving their money and consuming less.

Economic experts are fond of saying that the consumer (through consumption) is responsible for 70% of the economy. Now, even if that percentage is a little high the fact remains our economy will have a hard time surviving if the consumer stops buying goods and services. By definition a consumer who is saving and paying off debt is one who is cutting back on the purchasing of goods and services. A contraction of money spent by the consumer will cause a contraction in the economy, which is by definition a recession.

Now some would say we need a lengthier recession in order to wring out the excesses if our economy (debt). These same people would state that this is the role of recession in the standard business cycle and that we just need to accept this fact. Yet, the problem with that logic is that our debt load is historically high and could take years if not decades to “wring out” of the system. In the meantime many people would lose their jobs, houses, go bankrupt, and suffer if not starve.

Also during this time of fiscal responsibility it would be hard for any new jobs to be created in a consumer service based economy. In an environment where the majority of Americans are cutting back on purchases, saving money and paying off debt who would want to open up a new or expand an existing business. In such an environment businesses close and lay off workers and anyone foolish enough to make what people aren’t buying will not stay in business long.

Likewise if the government were balancing its budget and paying down its mountain of debt the economy would continue to contract. A fiscally conservative government would not be able to stimulate the economy through giving money to businesses or consumers to encourage them to spend and create jobs.

The truth be told this has only been the case which our extreme debt crisis is only emphasizing. A fiscally responsible society in which its citizens saved their money and only bought what they needed would never be affluent or have enough jobs for its citizens. The majority of jobs that we have would never have existed if people only bought what they truly needed, or even lived inside their means. This is especially true of a modern society where automation and mass production reduce the number of employees needed to produce goods and services for people to consume.

The libertarian contention that a true free market capitalistic system based on supply and demand would cure all our ills including the lows of the business cycle are not rooted in the real world. Not only does it ignore human nature, the imbalances inherent in amassing capital and the complications caused by urban and global markets, but it just doesn’t take into consideration automation and the simple fact that we cannot provide 6 billion people with truly gainful employment.

Taking a look at the camp which advocates the printing of money and all other forms of stimulating the economy through fiscal stimuli, we find a host of new limitations to their solutions. First of all much of the bailouts are a continuation of the trickle down theory of economics which has greatly assisted in the creation of imbalances inherent in our debt laden society.

Since the 80’s the relative wealth of the majority of Americans has declined while an increasingly shrinking percentage of Americans are hoarding a larger and larger percentage of total wealth. An escalation or even a continuation of the rate of printing more money is likely to only enhance the gulf between the have’s and have nots.

The stated goal of expanding the money supply (printing money) is to stimulate the economy by making funds available for consumers and businesses to pay down their debt while providing businesses with the necessary funds to expand their operations and thereby hire employees.

Yet, many of the dynamics and repercussions of monetary expansion and bailouts only inflame the debt problem and make the monetary gulf amongst American’s more exaggerated. Let’s take a look at a few of the most obvious flaws and historical limitations of monetary expansion.

First it should be pointed out that we have been expanding the monetary supply for decades which has had the net result of depreciating the dollar and inflating the national debt through many different vehicles including the trade deficit.

When you add money to the overall pool of money in existence you are immediately making each dollar worth less. As the money supply grows each individual dollar losses some purchasing power. Imagine playing monopoly and you had $500 dollars and the bank totaled 10,000. In that case you would have one 20th or 5% of all the money available. In a game involving four of five people you’d be doing okay. Yet, if someone were to increase the banks total to 1,000,000 dollars your $500 would be far less impressive and you would now own about one two thousandth of the amount and no where near even one hundredth of one percent of the money available.

This is essentially what happens to our purchasing power as the money supply increases. The only people who immediately benefit from monetary expansion are those able to borrow money and those that lend the money. When the federal reserve prints money they and the banking system make money through the interest acquired by loaning the money out. Since the Fed is a private banking cartel which has a contract with our government we the taxpayers pay the interest that the government owes for the money being printed.

Currently we have interest rates at historically low levels whereby the money being printed is not very costly to a borrower. This allows wealthy people an opportunity to borrow a good portion of the money with little overhead. While this does present the opportunity for the wealthy to use this money for business expansion and job creation the reality is that the money is more often than not used for other purposes.

The money invested in business expansion could be used to build factories abroad where labor is cheaper and thereby not helping the US’s unemployment problem. Second, the money borrowed at low rates can be used to buy longer term US bonds or foreign bonds with higher yields. The borrower can then use a portion of the money borrowed to pay off the interest and use the higher yield of the bonds they purchased to generate a sizable profit.

The profit garnered through the higher yield bonds can be reported as earning by a corporation giving off the impression their business is improving and thereby entice investors to buy their stock which further increases their profits in a self perpetuating cycle of profit allowing corporate profits to surge despite low growth or even a decrease in earnings generated in their actual business.

Money printed by the Federal Reserve is money, we through our government, have to pay interest on. All printed dollars added to the money supply weaken the purchasing power of already existing money (by diluting the money supply) while increasing the amount of government, and hence, tax payer debt.

The goal of printing dollars is to stimulate economic growth. In an ideal situation you would gain more than a dollars worth of growth for every dollar printed. Yet, statistics have shown that this is not so. About two decades ago we created about a dollars worth of growth for every three dollars printed (borrowed). The relationship has deteriorated ever since and the last statistics I saw had us needing to print about $10 for every dollar of economic growth.

What the above paragraph says is that while printing money does in fact stimulate economic growth it causes a much more significant growth in debt. In other words for every dollar we print we are incurring more than a dollar’s worth of debt plus the interest owed to repay the Federal Reserve for their efforts.

The more money you print the less purchasing power the dollar has, which is what we mean when we say that the dollar is being devalued. What this means is the more dollars in circulation the more dollars you need to pay for the same item purchased before the money supply increased. This commonly referred to as inflation.

So while printing dollars may stimulate the economy it also causes inflation. Inflation causes a rise in the cost of living. So, unless workers wages are climbing faster than the rate of inflation, a rise in the money supply makes it harder for people to purchase things. Inflation making things more expensive has a tendency to slow down economic growth. So, in most situations one lowers interest rates to stimulate the economy. Yet, since our interest rates are already at historic lows (between 0 and .25%) we are unable to lower rates to stimulate our economy.

In essence we are currently trying to borrow our way out of debt. Yet, printing money causes more debt and makes it harder for people to pay off their debt. If things cost more people will have to spend more on basics such as food and shelter and use the rest to keep up with or hopefully pay down some of their debt. Inflation means more and more consumers will cut down on purchases and the number of people going bankrupt and having their homes go into foreclosure will increase. Businesses, likewise, will have a hard time paying off their debts and staying in business. Many of those not closing their doors will be forced to lay off workers in order to survive.

As the title of this post suggests we are in an economic Catch 22, where both cutting back on consumption and printing money (increasing debt) will cause more job unemployment and further contraction of the economy (recession or depression). At this point in time it seems that our policy makers are content to try and keep things afloat for as long as possible.

The best analogy I can think of is that we are in a skyscraper that is on fire. Without a means of putting the fire out we are deciding to try and out run the fire. Instead of jumping out the third story window, we are running up the stairs to higher floors as the fire chases up after us. Having no water we stack all the furniture we have to block the path of the fire allowing us to race up to higher floors hoping the fire burns itself out. Yet, the barriers we place in front of the fire (furniture = debt and inflation) is a known fuel for fires making it likely the fire will only quicken and strengthen. The higher we climb the less of a chance we have for a safe and successful leap from the inferno.

In sum having people focus on reducing consumption and reducing their debt will likely result in slowing down the economy even further resulting in increased unemployment, foreclosures and bankruptcy. While increasing the amount of debt through printing money and corporate bail outs will only increase the mountain of debt choking consumers and businesses. In such an environment business contraction and not expansion is likely and larger corporations can make money off money borrowed and if they do expand businesses it will be in countries or communities with cheap labor.

This post has gotten far too long, so in my next post I will explain why I think this Catch 22 exists and what should be done about it.

Jim Guido

I can’t remember a time in which business and government weren’t thought of as being radically different and usually opposed to one another. Businesses labeled the government as intrusive and inefficient. The standard line was that government jobs and decisions wouldn’t survive in the real and competitive world of business.

If the government were a business, it was often said, the government would be out of business in no time. Government jobs were often characterized as “cushy” and had little need for productivity or efficiency.

The government was also viewed as a populist police force in which business success and progress was impeded by government’s policies and tax practices. Without government intervention the belief was “the sky was the limit” for the success and wealth of corporate America.

I’ll have to admit I never saw it that way, and as time has passed I think it is becoming increasingly apparent that there is little difference between government and business. In fact, in many ways the US government appears to be little more than a very large and powerful business enterprise.

Those acknowledging the more business friendly attitude of government throughout the years usually start by pointing out the increasing power and influence of special interest groups. Numerous trade policies, the destruction of the labor unions, and business friendly policies and tax laws are directly attributable to the monetary and legal influence of the business world acquired through the omnipresence of lobbyists in Washington.

The increased presence of the media through radio, newspapers, TV and the internet has made the success of political campaigns more dependent on highly expensive ad campaigns. The more elections are dependent on larger and larger funds the more crucial the role of campaign donations. Since wealth and business go hand in hand, it is easy to see how the role and importance of corporate America has become in national elections and even at times in local elections.

In a democracy the existence and survival of politicians is dependent on their being elected and the more elections are dominated by donations and monetary issues the more politicians are dependent on the support of business (corporate America). This reality has made it difficult for those opposed to the priorities and political platforms of the wealthiest of American’s to get sufficiently funding for their campaigns or get and stay elected.

Though these realities are difficult to ignore many still believe that mavericks and populist candidates can and do exist and get elected. Without media coverage no candidate can win a national campaign. Those few families who own the major media outlets are amongst the wealthiest people in the nation. Believing that these people do not protect their interests and influence the coverage produced by their employees is quite wishful thinking.

In most cases it takes money to attract money. Our entire political system is becoming increasingly dominated by wealthy people both as supporters and as candidates. This is not to say that the wealthiest candidate will win an election but more accurately that one will not become a national candidate without being wealthy or a friend of wealth. The majority of national candidates entered politics with a good deal of money while some were not themselves wealthy but found ways to get the support and backing of wealthy donors.

In other words as time marches on the national political scene in the US is being dominated by wealthy US businessmen and lawyers. Those running our country, Congress and the state legislatures and their governors are wealthy American businessmen.

When one has spent their entire professional careers being a successful businessman do you think they change their methods, practices and priorities once they become elected? Yesterdays corporate heads are today’s national political leaders and cabinet members. Those who govern today were yesterdays business leaders, and those few national leaders who weren’t business leaders before getting into office become wealthy business leaders when they leave office. If that doesn’t show you their loyalties and priorities than nothing will.

Our government is a business, a very large and powerful business. The old saw that business is efficient and government is inefficient should after all the recent bailouts be proven to be false. American businesses have not been efficient or successful for decades. Corporate America has been the recipient and beneficiaries of empire. For every story or invention and business integrity you can find you can find dozens of exploitation, piracy, intimidation, recklessness and the like as the source of success. We were a nation blessed with great and ample natural resources and a military will and ambition to use the resources and talents of the entire globe.

Our government is in debt, but so is corporate America. Taxpayers have been the only thing that has kept our government from defaulting and going bankrupt and the same could be said for corporate America.

Our government is a business it makes money directly and indirectly through its intricate and mutually beneficial relationships with corporate America. Most people now admit that our government has entered wars for purely economic reasons and not for political ideals such as freedom and human rights.

Our government is highly dependent on our military to maintain our role and position as the reigning superpower. One could make quite a strong argument that our military and the business of war are vital to our economic survival. Not only is war important in protecting our economic interests such as oil in the middle east, but our economy would probably fall apart if we decreased our domestic and international dominance in sales of arms and military hardware.

It is interesting to note that the largest media outlets in the US all have high stakes in the arms and munitions industry.

More and more people are becoming aware of the fact that the Federal Reserve is not a federal agency but a private banking cartel. This corporation through its contract with the US government is able to print money and highly alter the value of the dollar. In some direct and more often indirect means this private corporation is able to use and abuse tax payer money.

Yet, the government under the guise of representing the people is doing the same thing. They are a business and all of the major players are businessmen who are protecting the monetary interests of themselves and their friends through the use of tax payer money. The same people who promised workers retirement funds and reneged on those promises are now making decisions on social security and other tax monies they took out of our paychecks.

Tomorrow many Americans will go to the polls and exercise their right to vote. I myself am a voter in search of a candidate. I have no desire to support or enable a corrupt system which does not represent my interests or values. I have no interest in maintaining “business” as usual.

Our government and our society in general is far too dependent on the world of money. This makes us dependent on all the ways money is generated in the world. Money is power and security, it is the only currency we officially recognize. A society dependent on money is dependent on making sure that it is involved in the largest and most lucrative industries all over the planet.

Our government being a business must tolerate and exploit all the arenas of wealth. As long as many of the best prospects of monetary growth are provided by unseemly activities and industries we must condone and partake in those activities.

We must war and promote conflict to support our arms economy, and even torture and use shameless propaganda. We must hide and understate dangers such as the gulf spill and the air quality of New York City following 9/11 to keep commerce flowing. We must lie to people regarding our true interests in foreign lands that harbor valuable products such as oil, heroin and cocaine, while at the same time exaggerate the potential harms of nations not playing by our economic rules and conditions (Iran, Iraq, Cuba, Panama, etc.).

I guess many of you will not agree with the last paragraph and view it as cynical or exaggerated. Maybe I am wrong or am over stating the dark side of economics. Yet, it does seem logical to me that the wealthiest nation on the planet can only maintain that position by leading in the marketplace. A nation whose values and business practices were above or opposed to the functioning of the real economy would soon lose its position.

Let me just give you a few quick examples of our media’s complicity in seemingly protecting the interests of the wealthy, special interests groups, and donors. It is common knowledge that some of our nations largest campaign contributors are wealthy people from foreign nations who return favors with campaign contributions. One only has to think of the concerns that were expressed when it was revealed that many of Bill Clinton’s largest campaign contributions were coming from Chinese and Asian businessman.

Our media presents the situation in Israel in quite a different way than most of the world press. While most nations are horrified at the way the Palestinians are being treated, are press stands alone in viewing the actions of the Israelis with sympathy and support. The Palestinians are a captive people cut off from the world. Over a 100 Palestinians are killed for every Israeli and many of the Israelis are killed by friendly fire. They have no air force or organized army and have little access to arms. Israel is major player in world arms sales and has sophisticated technology such as drone planes and robotic gun fire run by soldiers in underground bunkers.

President Carter recently said that the Palestinians live “in a cage”. Reports of kids being killed by soldiers and robot fire for just moving “too close” to restricted areas is fairly common. Though being one of, if not, the most impoverished people on the planet the Israelis are currently burning their olive trees during their harvest season which is their most important crop as well as having social and religious importance.

While most of the world describes the situation as a genocide being conducted on the Palestinians our press and president still talks of Israel’s right to protect themselves and label the Palestinians as terrorists not victims. And, of course, since Palestine is not recognized as a nation and has no official or recognized army than any military action can be technically defined as terrorism.

It would appear to me that Israel’s sizable economic relationship with us coupled with its sizable and influential lobby makes them hard to criticize. In our own nation there are many wealthy political donors who are sympathetic to the nation of Israel and would not back any candidate who was critical of any actions of the Israeli government. All in all there is a lot to be gained by a politicians and the media going soft on Israel and a lot to lose by presenting some of the views accepted as fact in most of the world including our allies in Europe.

I began the last paragraph by starting out saying that it appears to me, and then went on to explain my perceptions and my reasons for my perceptions. The point is that when our priority is wealth and money truth is at least secondary and possible an obstacle. A salesman will often emphasize the strengths of his product while minimize or distract someone from recognizing the weaknesses of the product. In some cases salesman may even go so far as to totally misrepresent a product to get a sale.

When money is primary truth is at least secondary, which means when we are being treated as a consumer we can be fairly assured that we are not getting an accurate picture of the situation. Long ago we stopped being referred to and treated as citizens and have since been handled as consumers. As voters we are consumers of politics and politicians have become products we believe in and vote for.

We are a proud society. We are proud of being capitalist and proud of being a democracy. Improvements in our quality of life and our standard of living have been largely acquired through our economic system. Yet, now money is no longer a tool or a vehicle, but has become synonymous with the system itself.

And now for something completely different!

Here are a few miscellaneous thoughts and a couple of jokes I made up.

What do you call a Rastafarian percussionist?
The dreaded drummer

When gladiolas wilt do they become sadiolas?

A man is divorcing his wife for emotional abandonment. In court the man tells the judge that his wife spends all her time doing crafts such as sewing, quilting and embroidering. He states that she never cleans the house and when he comes home from work she never has dinner ready.

His final statement before the judge is that his wife seldom comes to bed and if fact the previous night he got no sleep due to the noise of the sewing machine whirring away as she worked on a quilt well into the morning hours.
After hearing this the judge turned to the wife and asked “how do you plead”?

The wife smiled and responded, “Quilting as charged your honor.”

____________________________________________________________________

Let’s look at the difference between the words here and (t)here. As you can see the only difference is the initial (T).

In physics (T) stands for time in many equations. And in the real world the difference between here and there is essentially time. Here is now and in the present. To get there takes time, even if it is just to look over there. Hence, here is now and there is not now.

Now lets take a look at the difference between here and where.

Here and (W)here.

Again the difference is one letter in this case the initial W of where.

It is interesting to note that the letter W is the first letter of most question words. Who, What, Where, When, Why and Which are all examples. How does not begin with a w but ends with one. It is hard to think of a question word that does not begin with the letter W.
A question is an uncertainty, and the difference between here and there involves going
from a known place called here to an unknown or uncertain place referred to as where.

So this observation is neither here nor there, but I’m here and you’re where?

Jim Guido

I read the following two articles this morning and felt they help highlight two of my recent themes on this site, one that US journalism is dead and two that the emergent global economy will be dominated by a handful of people while everyone else is heading towards serfdom.
The articles will be in parenthesis, and my comments will not.

( Auto giant Ford Motor Company today said it has reported a 69 per cent jump in third quarter net income to USD 1.68 billion driven growth in North American operations.)

Many Americans will be angered by the fact that a bailed out company would be making such obscene profits. Yet, my focus would be in an investigation of how the profits were made.

(Ford attributed its robust quarter numbers to better products, momentum in North America and continued success at Ford Credit amid still-challenging business conditions.)

This explanation of profits is skillfully worded and misleading and, of course, is allowed to stand without any questions by the media reporting (or just printing) the story. First of all better products don’t make profits. So, the question is who is buying all these vehicles. There is no mention of the USA in particular which probably means sales were not strong here, but maybe had some improvement in Mexico and Canada (North America).

The real key here is the mention of the “continued success at Ford Credit amid still challenging business conditions”. What this most likely means is that the bulk of Ford’s profits are on financing of previous sold vehicles and not on current sales.

(”This was another strong quarter and we continue to gain momentum with our One Ford plan. Delivering world class products and aggressively restructuring our business has enabled us to profitably grow even at low industry volumes in key regions,” said Ford President and CEO Alan Mulally.)

(In terms of geographical locations, Ford has posted a impressive numbers in all the regions-North America, Europe and Asia Pacific Africa accept South America.)
Alan’s indirect message is that Ford is making more money selling abroad than in the US. And like most industries is making more profit through an increase of volume through an increase of customer base (global market). This means that while sales numbers are reducing in the US they are expanding in countries such as China, and coupled with the low cost of labor abroad is allowing Ford to make substantial profits even though vehicles prices are not increasing.

(Ford said it has,” posted a 28 per cent sales increase in Asia Pacific Africa, including a 14 per cent increase in China led by Fiesta demand and a 190 per cent increase in India led by sales of the new Ford Figo.” During the quarter, the company had announced plan to launch eight new vehicles in India by mid-decade and export Ford Figo from India to 50 markets.)

Yep, sales in emerging countries are what’s powering their profits along with the financing of vehicles.

(Ford said it will continue to post good numbers with increases in both cash flow and profitability in 2011.)

Sounds like a winning formula to me, get bailout money locally to help finance expansion abroad. Sit on hordes of cash, borrow money at almost 0% and then invest it in stocks and higher interest bonds and claim money made in this fashion as business profits. So, even though sales numbers are hurting you can still claim money made through investments as profits and make even more money as investors buy your stock because of your profit claims in quarterly reports. Add on to this the financing of vehicles already sold and:
Keep this up and you can become even wealthier without selling or even making cars and trucks. In the meantime until emerging markets go into a major economic downturn you can make even more additional profits through cheap labor selling cars to previously carless consumers.
Okay, now time for article number two.

(One out of every 34 Americans who earned wages in 2008 earned absolutely nothing — not one cent — in 2009.

The stunning figure was released earlier this month by the Social Security Administration, but apparently went unreported until it appeared today on Tax.com in a column by Pulitzer Prize-winning tax reporter David Cay Johnston.)

Jesus, three percent of the working populace didn’t make a penny and no major publication bothered to even print the information. My claim of US journalism being dead seems less like an exaggeration now huh.

(It’s not just every 34th earner whose financial situation has been upended by the financial crisis. Average wages, median wages, and total wages have all declined — except at the very top, where they leaped dramatically, increasing five-fold.)

As I have mentioned many times on this site it appears as if we are heading towards a global deflationary spiral which will assist in getting the American and European middle class more in line with the wages of the rest of the planet. More and more wealth and ownership into fewer and fewer hands.
(Johnston writes that while the number of Americans earning more than $50 million fell from 131 in 2008 to 74 in 2009, those that remained at the top increased their income from an average of $91.2 million in 2008 to almost $519 million.)

The number of the wealthiest people whose wealth and standard of living increased was cut in half in a years time. These people aren’t poor by anyone’s standard, but the elite club of winners in the global economy is shrinking fast. While almost everyone’s wages and net wealth is in severe decline, the top seventy four people did rather well. There total wealth didn’t just increase 5% or 6%, or even 20% which would represent an incredibly lucky year in the stock market, but their wealth went up some 500% to 600%.

(The wealth is astounding, says Johnston. “That’s nearly $10 million in weekly pay!… These 74 people made as much as the 19 million lowest-paid people in America, who constitute one in every eight workers.”)

Let’s hear that again, seventy four people are making as much as 19,000,000 people. In other words 74 people are making more than 1/8 of the entire work force.
(In September, Senate Republicans along with a handful of Democrats, partnered to defeat the Creating American Jobs and Ending Offshoring Act, a bill that would have raised taxes on companies that send jobs abroad and benefited companies that bring jobs back to American soil.)

This is not about just getting rich. It’s about getting rid of the middle class and reducing all but a few to a life of servitude and subsistence living. Few will own and the rest will be owned. This sounds harsh, and I hope I’m wrong, but the data is the data.

When I try to make sense of many of the actions and trends of the last two or three decades no other explanation seems to fit the data. Trust me I keep looking for a more humane explanation, but none fits the data.

I am by nature an upbeat, energetic and positive person. I think we still have many opportunities to stop this madness, but you can’t change a problem until you identify it. The more accurately you identify and define the problem the better your solution can be.

So, here’s to having the courage and stomach to thoroughly explore and understand the problem.

Jim Guido

PS The first article I read on Google News, and the second article is from the Huffington Post.

I am uncomfortable enough being an American, but even more uncomfortable being a tourist. For many years we traveled little. Mostly we visited family. A number of years ago we did travel to Italy and Greece to visit our homelands and get a sense of our heritage (I’m Italian my wife is Greek). Other than that we’ve done the occasional week at the beach where we rent a beach house with friends.

Currently we are in Puerta Vallarta Mexico at a time share which my wife received as a gift from a friend of ours. We are staying at a resort hotel and I feel totally out of my element. The experience of Mexico has been pleasant and we have done some activities and ventures to acquaint ourselves with the local culture and its history.

My discomfort with being at a resort has only subsided when we venture from the hotel and surrounding resort community. I find being treated as a tourist almost nauseating. For any of you who are frequent visitors to this site you are aware that I am no friend of our consumer culture and capitalism in general.

I do not like people serving me and treating me like an invalid. I do not like tipping people for invading my personal space and doing things I’d rather do myself. I do not like vendors and local merchants badgering me and getting angry when I do not spend money at every instant.

I can’t bear watching people slave in the heat to provide me services and then smile and ingratiate themselves anytime I approach or share an elevator with them. Why shouldn’t these people have some time to relax and enjoy the sun? I guess I’d feel better if we took turns pampering each other than me always being the recipient of their care.

As part of the package we were expected to take part in a time share presentation by the company which owns the resort. The two first people who talked to us were friendly and humble. We liked them and almost wanted to buy a time share to help them out. Yet, the wheel and dealer who they called in to go in for the kill and do the true hard sell was a very self absorbed salesman. He tried every sales strategy and forced bonding technique I’ve ever been acquainted with.

He reminded me of a character out of Roger Rabbit as he verbally bounded and gesticulated in caffeine induced energy. His efforts to engage and persuade us went everywhere from cajoling, to siding with us and finally, to challenging us and finally to insulting us for not taking advantage of this great opportunity and deal he was offering. During this time he was living in the salesman moment and had no idea how many times he had contradicted himself as he discarded strategy after strategy trying to find our personal Holy Grail of inducement.

At the end of his high pressurized presentation I felt a combination of anger and sadness at the man. He appeared to be a very successful salesman, yet he also appeared to be a very unhappy individual.

Walking the streets near the resort one perpetually has to fend off the aggressive questions from vendors, merchants and taxi drivers, who all seem angry when you attempt to ignore their verbal assaults and questions as they follow you down the street. Any attempts to be human and courteous on our part by making eye contact and saying no thank you only increases the intensity and length of their inquisitions and inquiries.

I bear no grudge against most of these people for they are just trying to make a living and survive. Yet, I do dislike the way they make me feel as I hate being a person who ignores others. I am by no means a wealthy person, yet I realize how fortunate I am to not have to behave in such a manner to insure that my basic needs are taken care of.

Yet, any local I talk to in Puerta Vallarta who has not been trying to get me to buy something has been very kind and pleasant. My experience here this week has only further secreted my negative attitude towards money and furthered my belief that money brings out the worst in people.

The odd thing is that none of the people staying at the resort strike me as being wealthy. For the most part everyone seems to be from middle and working class situations who use these vacations as a way to taste the “good life”. Most people seem almost as lost as I in terms of knowing when and how much to tip and all the other rules and expectations of pampered resort life. Alcohol and immature behavior seem to be the only ways people get beyond this performance anxiety of being a good hotel guest and tourist.

Historically the exhibition and exercise of wealth has always been accompanied by the amount of services one receives. From ancient Greece and Rome to modern England royalty and the wealthy have always been surrounded by servants who took care of their every need and desire.

I cannot relate to anyone who views having others to help clothe, feed and bathe them as a positive. In my world having wealth means being in control of all my time and what I decide to do with it. The wealthy who rely on servants and slaves have no true privacy. They are incessantly hovered over and watched by servants. The only way they have privacy is to ignore the presence of the servants and treat them as animals or invisible or inconsequential human beings.

In my world no one is inconsequential. When around others it is with a desire to share and interact with them. I want to understand their world and perspective and gain an appreciation for what gives their life joy and meaning. I want to feel their concerns and hopefully reach some point of agreement or commonality. I yearn for their validation and appreciation of my uniqueness as I want to validate them and appreciate their individuality.

The things I’ve enjoyed most of this vacation are the conversations I’ve had with others when they have disclosed to me something they hold dear, or when I’ve been able to catch a glimpse of how they experience their world. Likewise, my moments of joy in pure activity have come when I’ve been able to have a moment to taste and savor the local environment both in terms of nature and human community.

Lately the limits and harms of economics and capitalism in particular have dominated my thoughts. I used to be able to cite many benefits of modern economics along with its drawbacks and limitations, yet each passing day the harms and restrictions become more pronounced and the benefits become more relegated to the past tense. The benefits currently being produced and procured by capitalism I see as despite of rather than caused by our free market capitalistic society.

I feel like we’ve outgrown modern economics, that economics itself is a pseudo science like alchemy and that we are in dire need of the birth of chemistry. Yet, even more accurately I view economics in general as a stepping stone that has served its purpose and insufficient in successfully being able to meet the physical, emotional and intellectual needs of those living on the planet.

Modern economics is like a old pair of shoes that we have long outgrown. They use to provide us with protection, safety and were our means of comfortably moving forward and about, yet now they constrict, chafe and cause us more harm than good.

Jim Guido

I find it a little odd when I hear someone express doubt of the authenticity of the facts of a report because it was written on the web and not by a major media outlet. While I agree that one should always be on the lookout for biased, agendized or even false journalism, I find it odd when people consider main stream journalism legitimate and discount alternative journalists out of hand.

The fact of the matter is that the majority of mainstream corporate media is inherently biased, spun, and written for a specific purpose. I’ve seen some statistics which state that over 70% of news stories are written by corporations and businesses themselves and placed in the news media.

The vast majority of the media itself is owned by a handful of families and to think that these families are not protecting or promoting their own interests and those of their friends is foolish at best. Yet, even if one does not have the time to fact check or research a topic, the very style and format of most of modern main stream journalism demonstrates its lack of integrity and authenticity.

The media, like most enterprises, has become increasingly dominated by economic processes. It is all about economic success and increasing market share. Smaller outlets are bought out or merge with other outlets in order to compete and survive the economic realities of a capitalistic society. Merger after merger ends up with a shrinking field of huge media entities.

These huge entities depend on access to newsmakers, advertiser revenues and increased market share for their survival. Such huge conglomerates have many divisions in varied fields of interest. It is important to note that every major news outlet has strong ties to military, financial, and industrial corporations which they almost daily have to report on. Conflicts of interest are inherent in this megastructure.

A reporter who is relatively harsh or critical of a political figure will not get exclusives or easy access to that political figure. Such a reporter will seldom be called on during press conferences and therefore endangers his position with his employer whose focus on the bottom line needs the story even if its soft.

The reality of reporters needing access to the people they report on isn’t the only factor making it difficult for reporters to be unflinching in their reporting the facts. Advertisers have a big say in how a story is written and reported. Even when they don’t censor or directly influence a potentially damaging story to their financial interests, they can always remove their financial support of the offending media outlet by dropping their ads from the radio, TV or print medium involved.
Just as politicians have become more products than leaders whose primary goal seems to be getting elected rather than an agent for designing a healthy society, likewise, the media’s need for market share makes their entire business a popularity contest and not so much about information, education and the unbiased reporting of hard facts.

On a national level it is almost impossible to write an expose or an honest portrayal of events without insulting or harming one of a news medias own subsidiaries. The huge media conglomerates are integral parts of mega multinational corporations which depend on consumer confidence and goodwill in order to continue to flourish.

This is not to imply that our news is always positive and business friendly. Everyone loves a good story and controversy sells more newspapers and magazines than anything else. The important thing is that in the long run business booms and short term dramas seldom lead to long term fiscal damage.

The advertisers themselves try to make their product look good, by making their competitors look bad. Yet, in the world of politics we thrive on the two party system. Our media loves to foster controversy between supposedly opposite poles such as conservative/liberal, democratic/republican, industrial/environmental, individual versus social rights and so on. In many of these battles the sides are really just two sides of the same coin and this easy controversy is used to distract people from real issues and choices.

The difference between Democrats and Republicans has been shrinking for decades now. Since both parties are dependent on the financial support of the wealthiest Americans neither can afford to truly represent the interests of the common man (unless you can convince the common man to support the interests of the wealthiest Americans). Both parties now support big business, war, Wall Street, etc., the only debate is in how they support these entities.

The days of classic journalism have been gone for decades. News reports no longer strive to be objective and neutral, they no longer just report the facts answering the basic questions of who, what, where and when. Yes, even in the old days specific perspectives were given, but when one perspective was given so were many others. Now, there are only two black and white perspectives given, these two viewpoints are usually labeled as democratic and republican or conservative and liberal.

I can hardly think of a single issue in which my viewpoint falls inside either of the two camps. I can’t recall the last time I read a report by the mainstream media or heard a speech by a politician which I felt articulated or even came close to a perspective I have.

I know many people who still consider outlets such as PBS and NPR as objective and even humanistic. Though I’m not a regular consumer of these outlets I have noticed a dramatic shift away from objective investigative reporting, or even a humanistic perspective to one which is noticeably status quo and supportive of current power structures and their policies.

Often times the opposing perspectives I hear regarding domestic and international policy on NPR radio are very narrowly defined. It’s like hearing if the choice is whether to watch an NFC or AFC football game and totally ignoring the possibility of the hundreds of viewing choices one has while those games are on TV. No one questions wars or the ethics of political policies, but only the two narrow and almost identical strategies of republicans and democrats.

Television and radio programs are well rehearsed in which the execution of the newscast must be planned out to almost the exact second. Even the bulk of interviews conducted on radio and TV though attempting to sound impromptu and natural are for the most part totally rehearsed. Questions and responses of supposed candid interviews are preplanned and prepared for, thus allowing interviewers a smooth interview with no dead and uncomfortable air space and no surprises for the person being interviewed. Despite the fact that most interviews progress in this seamless manner and fit perfectly into an exact time frame for the newscast, most people seem to buy into the authenticity and spontaneity of the interview.

Reporting the facts and being objective has been replaced by news anchors who explain the news to us and engage in highly emotional and judgmental language. In a story or report it is often obvious which “side” we are supposed to believe or support. The bad people’s quotes, organizations or nations are littered with words such as “so called”, “alleged” and their actions framed as “terrorists” or “insurgents”. While the good guys are often the victims of a given situation and their quotes are certain and contain no doubt. When the need for description is called for they will be referred to do as defenders of justice or freedom fighters.

One of my favorite phrases used so often in modern news reporting is “some people feel”, or “some people believe”. In reality this is a total non-statement, but used artfully it can steer public opinion in the direction you want it to go. The authority and voice tone of the speaker is the only thing giving the phrase “some people think” any validity or influence. Yet, these phrases are uttered by news reporters more often than almost any other.

Obviously in any debate some people think one way and others think the opposite, the newscaster is taking sides by only stating one side. Comments such as “some economists think concerns regarding the economy are over blown”, “some experts feel that entitlement programs reduce productivity”, or “some scientists feel that global warming is more myth than fact”, all are misleading and prejudicial. Any statement of fact should have ample data supporting it, resorting to “some people” opinion statements is not good journalism nor a good sign of the objectivity of the report.

Early on in this post I pointed out some of the factors which have greatly contributed to the death of ethical and responsible journalism. These factors included the increased role of advertisers, the world of wealth the owners of mass media belong to, and the financial realities of media including market share and keeping friendly relations with news makers to insure constant access. Let’s expand on these ideas a moment to further articulate the growing sham that is portrayed as objective journalism.

So often our journalists are asked to stay mute or avoid reporting important news for the sake of “national security’ or if their reports could put “honest Americans in danger”. When reporting on the Iraq war journalists were banned from reports which could provide “aid and comfort to the enemy”, or divulge “sensitive information”. Instead they were required to just cover the press conferences held by the military to update the public on the war, or become “embedded” with the troops in chosen activities. The danger of not following these conditions was obvious in the fact that the Red Cross and foreign and alternative press incurred bomb and artillery attacks on a number of occasions even when they were clearly marked or had recently communicated their position and purpose.

No photos were allowed of military action or of injured or killed servicemen. Any report at all critical of the war or the actions of our military was attacked as anti-American and a danger to our troops. Without balanced and objective coverage of the war American’s weren’t able to monitor and question the policies and actions of its military. A case could be made that freedom of the press could alert the public when a military campaign is unnecessary of ill advised and thereby save the lives of our troops and our national security by removing us from battles unfitting to the goals and ideals of a world power.

One has to wonder about our government’s concern about national security and its relation to what is reported on the news. If filming our troops and military actions in a war zone is a threat to national security then why is not a danger to frequently encourage our press to insult and antagonize our enemies and their leaders?

The list of foreign leaders and nations which our leaders through the media label as evil and crazy is quite extensive. If it were true that these leaders and these nations were truly a threat to our national security why would we publicly call them crazy and ruthless? If we really were vulnerable to their actions and military attacks why would we acknowledge and admit this? If our media retained a shred of journalistic integrity don’t you think that be asking our leaders these questions?

The asking of questions in America which does not serve the interests of the military/industrial complex, or fit into the conservative/liberal debate is all but disallowed. Asking a question when facts don’t match the official story is considered paranoid or conspiracy thinking.

It is easy to view the national media as a lap dog for both the government and the wealthiest of Americans. A short list of what appears to me to be obvious examples of either utter stupidity or complicity should suffice to make my point.

When the towers came down they sure looked like a planned demolition and they came down at near speed of free fall totally inconsistent with the plane impact and resulting fire official story. This doesn’t even speak to the tower that came down which did not suffer any plane impact or direct fire caused by jet fuel. Of course, right away people defending the official story will accuse me of being a conspiracist or assume that I believe it was an inside job. Yet, strip the name calling and labeling away and the questions still remain. I have no idea what happened but why weren’t the logical questions asked?

Soon after the towers came down there were concerns regarding the air quality in the area. The EPA and other “experts” claimed that the air was fine despite the fact that workers and residents were complaining about symptoms which would typically signal a severe reaction to toxic air quality. Yet, despite this obvious contradiction of the official story I did not see any news report where they researched, investigated or questioned the official story in any substantial manner, or interview someone who felt the air was not safe.

The recent Gulf oil spill quickly went from ecological disaster to past history in an amazingly short period of time. The media once again was forbidden to film the spill or the clean up efforts. Then whole procedure was handled like a war situation where the media was forced to limit their reporting to information conveyed at the daily press conferences held by BP and the government.

Once the well was in the process of being capped the story went away. I saw some follow up stories in outlets such as the Christian Science Monitor in which the headlines proclaimed that the Gulf though injured was safe and quickly recovering. Most of the articles I read were artfully written to give the impression that the major harm was done and the long term prospects for the Gulf were promising.

All the articles talked of how effective the clean up efforts were progressing and that though the clean-up may take years, the general health of the waters and the sea life was better than anticipated. The articles that went into some detail do so in the following manner.

First they would state a range of gallons of oil that had been sucked up. These estimates were vague and never expressed in terms of the percentage of total oil spilled. Second they would state that some oil was sinking to the bottom of the gulf and described this oil as being relatively inert and only a harm to the sea life it was covering at the bottom. Each article hinted that the sinking oil was being caused by the chemical dispersants being amply used in the cleanup. No word of explanation was offered as to how something used to disperse the oil was somehow responsible for its coagulating and sinking.

In fact not one single article I read (of over two dozen) mentioned the fact that the oil that was successfully dispersed wasn’t gone, but only dispersed into the water. They would say the noun dispersant but avoided all verb forms which could imply that oil was being dispersed and not removed. Not only did the reports and journalist not ask any questions regarding this conflict, or report the actual mechanics of chemical dispersants, but they also underplayed the toxicity of the chemical dispersants. In sentence after sentence they would say that the dispersants have not been “proved” to be more harmful than the oil, and that in fact they are “considered” to be less toxic than oil.

The following parts of the articles truly show the death of journalism. They went on to say that since the chemical dispersants were less toxic than oil, a combination of the two was actually less toxic than oil alone. They stated that a gallon of oil was far more toxic than a half gallon of oil and a half gallon of dispersant. What they led a reader to believe was that the dispersant was replacing the oil it was dispersing and therefore making the gulf less toxic the more it was used. What was missing was any information regarding the amount of dispersant used compared to the amount of oil in the gulf.

Yet, since by its name a dispersant doesn’t remove but only disperses the most logical conclusion would be that we now have the toxicity of the oil spill plus the toxicity of the dispersant. I was horrified when these logical assumptions weren’t even posed as questions for the professionals to answer. So while the headlines of most of the articles proclaimed the Gulf as being safe, these claims were neither supported or questioned by the content of the articles.

A logical person is only able to conclude that the dispersants were not used to clean up the Gulf or reduce the toxicity of the water, but only to disperse the oil diluting its toxicity by spreading it over a greater area while at the same time making any further attempt at collecting or removing the toxic oil less possible if not impossible. Instead of collecting and cleaning up the massive oil spill, we decided to disperse it into the water system by adding additional toxicity to the water through massive use of chemical dispersants. Though our government showed a moment of backbone and humanity by ordering BP to stop using the dispersant they were and find a less toxic alternative, they did nothing when BP refused to comply and continued the use unabated.

There are literally hundreds of examples I could give in which it appears our national media has at worst lied to or deceived the public and at best did not ask the basic questions inherent in being a journalist.

Many of the world’s tragedies could be reduced and in some cases prevented by media outlets with integrity and ethics. Events and situations such as famine, torture, genocide, epidemics, slavery, abuse, crime and mass exploitation could be reduced or rectified by a free and ethical media. Yet, currently one has to wonder if the media is exacerbating these events and situations by being propagandists and apologists for those who stand to suffer financially by an open and thorough reporting of events and its related discussion.

Jim Guido