Useful Idiots – Food Sovereignty Case Study

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While looking for some information for another post, I ended up reading some older posts at Marion Nestle’s blog. It was as annoying as one would expect, reading a corporate-state-reformist who thinks Better Hierarchy will solve the problems created only by corporatist hierarchy as such. Here’s a good example (which also includes some pro-Democrat Party tribalism).

 

On Monday this week [July 2009], Michael Taylor began his new job as special assistant to the FDA Commissioner for food safety. He will be in charge of implementing whatever food safety laws Congress finally decides to pass.

I know that what I am about to say will surprise, if not shock, many of you, but I think he’s an excellent choice for this job. Yes, I know he worked for Monsanto, not only once (indirectly) but twice (directly). And yes, he’s the first person whose name is mentioned when anyone talks about the “revolving door” between the food industry and government. And yes, he signed off on the FDA’s consumer-unfriendly policies on labeling genetically modified foods.

But before you decide that I must have drunk the Kool Aid on this one, hear me out. He really is a good choice for this job. Why? Because he managed to get USDA to institute HACCP (science-based food safety regulations) for meat and poultry against the full opposition of the meat industry — a truly heroic accomplishment. His position on food safety has been strong and consistent for years. He favors a single food agency, HACCP for all foods, and accountability and enforcement. We need this for FDA-regulated foods (we also need enforcement for USDA-regulated foods, but he won’t be able to touch that unless Congress says so). So he’s the person most likely to be able to get decent regulations in place and get them enforced.

 

(This also sheds some light on Taylor’s liberal fan club in general.)

 

It’s typical of reform-corporatists to seek further concentration as the solution to every problem generated by concentration. This exactly parallels the Tower of Babel of corporatism in general. Every crisis must be met, not by ending the malevolent and destructive practices which create the crisis, but by doubling down on the evil, adding another layer to the already tottering tower. Reformists are either imitative parasites on the monster, or an indelible part of it.

 

It’s also typical that they fail to recognize the difference between a systematic corporate totalitarian and a yahoo, and that there are sometimes disagreements between them. Consider this tableau: In the Reagan administration there were lots of deregulation zealots who had come to see deregulation as an end in itself. They lost sight of the overriding profit imperative. At that time Monsanto had settled on its master strategy, which included going all in on riding the government thug/bagman to profit victory. So they wanted a full suite of regulation, but of course pro-corporate regulation. They wanted government proclamations, certifications, PR campaigns, corporatized public-funded research, globalization assistance, aggression against small competitors, an escalated intellectual property regime, and of course monumental amounts of corporate welfare.

 

But on account of the fact that the administration had come to see “regulation” as bad, Monsanto had to request a meeting with VP Bush and lecture him like a small child on how “regulation vs. deregulation” is meaningless in itself, but rather that the right policy is regulation and/or deregulation, depending on whatever will increase corporate enclosure, concentration, domination, profit, power.

 

Similarly, Taylor had to overcome some opposition from yahoos in the meat-packer sector who were too short-sighted to see that the HACCP, while nominally representing increased regulation, was really designed to increase sector concentration and power. It has since had that effect.

 

But corporate liberals like Nestle see only the more scabrous bad guy who opposed something, and assume this must mean the thing is good. But that doesn’t follow at all. (There’s where we see the parallel with “progressive” tribalism – wherever a Republican opposes something, it must be good. And since Taylor was nominally a Clinton cadre, and is now an Obama cadre, it must mean he’s good. Um, no.)

 

(For another example, that’s how the national Sierra Club happily jumped into bed with Chesapeake Energy and fracking, as soon as Aubrey McClendon bad-mouthed the coal rackets.)

 

Similarly, the real world effect of HACCP is meaningless to a useful idiot reformist. All that matters is that Democratic administrations support it, while some bad guys oppose it. (Though how Nestle wrapped her mind around the fact that Big Ag supported the Food Control Act she’s shilling for here, so that there is no “bad guy” from the liberal point of view, I don’t know. I guess Party tribalism trumps all in the end.)

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Kangaroo Courts and the Health Racket Mandate (Reprise)

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(This is an edited re-post of an earlier piece. I thought that in light of the looming “decision” on the health racket mandate by the supremely corporatist court, it might be useful to revisit the nature of this corporatist jurisprudence.)

 

A federal judge has given the first adverse ruling against one of the many lawsuits declaring Obama’s health racket Mandate unconstitutional. The ruling demonstrates the “logic” of a corporatist ideologue and how he views the Constitution. A corporatist assumes as the god-given order of things that the purpose of America is to be mined by powerful corporate interests. He then views the Constitution as purely instrumental toward this goal. As we’ll see, this judge views the artificial, ideologically fabricated and imposed “market” as sacrosanct and beyond the Constitution’s purview. He views the written Constitution, and by extension the sovereign people’s inherent constitution, as subordinate to the corporate imperative. This is the essence of corporatist ideology. It views sovereignty itself as reposing in corporations, not the people. The constitution is only the corporate constitution. The written Constitution is therefore the servant of corporations.

 

A judge like this might even try to argue that the fact that the Constitution never once mentions the word “corporation” is proof of his thesis that corporations are not below the Constitution, but above it. At any rate he’d argue that the absence of such specification gives him license to interpret things that way.

 

The human truth is the exact opposite. Society exists in the first place only of, by, and for human beings. Sovereignty reposes only in the people. The constitution can never be anything but of and for the political health of the people. The written Constitution can be legitimately interpreted only toward this human imperative. Corporations have no right to exist at all, and certainly have no right to act against the people. Wherever they do, any government has an affirmative obligation to smash them. Where it fails to do so, let alone where it actively supports corporate organized crime, it abandons all sovereignty, legitimacy, and authority. The people then have the right and obligation to repudiate the system, smash the criminals themselves, and redeem society on a human basis.

 

Let’s go to the case. The suit claims the health racket bailout in general, and in particular the racket Mandate, violates the Commerce Clause, the 5th and 10th amendments, the Free Exercise of religion*, and that it’s an unconstitutional tax. The decision rejects the demand for a preliminary injunction and throws the case out completely. The decision focuses on rejecting the Commerce claim, also rejects part of the tax claim, and declares it doesn’t need to reach another part.

 

In the so-called “factual background” the judge launches right into the propaganda. He intones:

 

The Health Care Reform Act seeks to reduce the number of uninsured Americans
and the escalating costs they impose on the health care system.
(p. 2)

 

and follows with a series of details. This is standard political fraud from the bench. As a matter of dogma, the judge is supposed to assume the legislature is a public servant and not a criminal cabal. So the court’s default is to aid and abet organized crime in the legislature. At the very least, even if the court is going to strike down an act (because of some ideological squabble among elites, not because the act is against the people), it still engages in this pretense of legislative good faith. That’s SCOTUS dogma going back a long way. (Anyone who follows the corporate media is familiar with the how it’s their established practice to report as fact the self-proclaimed intentions and mindset of elites, especially political elites. The courts have the same practice.)

 

Everywhere else judges are supposed to infer motives from actions. Why is that reversed here, and the dogmatically assumed motive is used tendentiously to interpret the action? It’s because here the system is functioning as an integrated machine. Elsewhere it’s the system against the people or individuals, so there the interpretive dynamic is reversed.

 

So here this judge proclaims that the Mandate is “integral to the legislative effort”, but everything he claims about what that effort is, and the constitutionality of the effort itself, is a lie. The Mandate is indeed integral to the effort, but the effort’s intention and goal is the opposite of Congressional and judicial lies. The effort isn’t to ensure better health care for more people at lower cost. A Congress which wanted to do that would’ve instituted Single Payer. Period.

 

The effort is to bail out the parasitic insurance rackets, who already have an institutionalized anti-competitive monopoly, by absolving them of having to compete with non-participation as well. That’s the one and only objective of Obamacare.

 

The decision moves quickly (p. 3) to bashing alleged deadbeats, the mythical free riders at the ER. But the entire premise of “the legislative effort” is to bail out a tremendous but politically powerful deadbeat and parasite, the insurance racket. So right at the outset we can see the judge’s bad faith. It’s not possible to be concerned about free riders but still support this deadbeat bailout bill. So on its face anyone who supports the bill (or finds it constitutional) but claims to be concerned about free riders is lying. Again, if Congress had been concerned about free riders, it would have enacted Single Payer instead of bailing out the insurance parasite. So on its face the judge’s entire rationale regarding the legislative intent is invalid.

 

We also have the moral fact that anyone amid a system based on organized corruption, legalized fraud, and massive robbery in the form of corporate welfare who would ever make a top-down anti-deadbeat argument must be a vile immoral criminal himself. It’s not possible to face such monumental system crime and still say the individual deadbeat is just as bad, or to bother with him at all. And then there’s the fact that the vast majority of individuals in that position are not deadbeats at all, but the victims of an aggressive kleptocracy which has mugged them into poverty.

 

As I said, this proves the judge is corrupt and acts in moral bad faith, so his “legal” reasoning must be judged from that point of view.

 

He has the haughty nerve to claim that it’s individuals, mugging victims who show up at the ER, who are “shifting costs onto third parties”. But the fact is that we the people ARE the victimized “third party” here, while the rackets and their bought politicians and judges are the only market “participants”, the only “stakeholders”, as their own flunkies would concede.

 

In a gesture of noblesse oblige the judge grants that the plaintiffs had standing to sue (p. 4). (But not before a lecture on the monetization of standing, how as far as the courts are concerned the only measure of citizenship is property, and the only measure of values or injury to those values is a monetary injury. This filthy doctrine must always be enforced. As usual, the first priority is to deny true citizen access to the law.)

 

The judge, as a petty crook aping a benevolent despot, magnanimously grants that a person without much money may already be feeling trepidation over the Mandate and acting accordingly, so standing is granted. The whole passage is sickening. The judge’s hypocritical, bloodless, wonkish, trickle-down “generosity” is even more repulsive than open, naked greed. How could any decent person even discuss this without outrage over the fact that those already suffering from the depredations of finance and insurance sector gangsters are, by the judge’s own admission*, to be made to suffer even more in order to pay yet further extortion to the most worthless and repellant criminals afflicting us today?

 

[*P. 8: "..the injury-in-fact in this case is the present financial pressure experienced by plaintiffs due to the requirements of the Individual Mandate."

 

This pressure is being put on by already-rich robbers who want to steal even more, and helping them commit this further robbery is the one and only intent and goal of this bill. That's the vision of "civilization" and "law" this judge seeks to uphold.]

 

We get to the Commerce Clause. Here’s the first time I’ve come across the Orwellian name for the Mandate: the “Shared Responsibility Payment” (p.11). Deciphering the totalitarian code: It’s the Full Responsibility of those who do all the work to hand over almost all they produce as extortion Payment to wealthy parasites who have and assume Zero Responsibility.

 

The judge is honest about this much: The Mandate is regulation of “inactivity, or a person’s mere existence within our Nation’s boundaries.” He admits it’s a poll tax.

 

The crux of plaintiffs’ argument is that the federal government has never attempted
to regulate inactivity, or a person’s mere existence within our Nation’s boundaries, under
the auspices of the Commerce Clause. It is plaintiffs’ position that if the Act is found
constitutional, the Commerce Clause would provide Congress with the authority to regulate
every aspect of our lives, including our choice to refrain from acting.
(p.11)

 

The decision says this case involves the third aspect of Interstate Commerce – “those activities that substantially affect interstate commerce.” Since that’s as vague as can be, and since by the reasoning here it can apply to literally anything the system wants it to, the judge confirms what we who oppose the Mandate always said. This Mandate is not only a crime in itself but a totalitarian precedent. If it goes through it can serve as the template for mandates to buy literally anything the system wants to force upon us.

 

The Supreme Court has expanded the reach of the Commerce Clause to reach
purely local, non-commercial activity, simply because it is an integral part of a broader
statutory scheme that permissibly regulates interstate commerce. Two cases, decided
sixty years apart, demonstrate the breadth of the Commerce power and the deference
accorded Congress’s judgments. (p. 12)

 

The decision discusses two highly disputed cases, Wickard v. Filburn and Gonzales v. Reich, as alleged precedents. With seeming lack of awareness of the ideological biases involved, in his own case and that of SCOTUS judges, he trumpets the striking down of anti-gun and anti-domestic violence laws as the SCOTUS philosophically “placing limits” on Congress.

 

Um, no. The judges on the court majorities simply support gun rights but don’t support marijuana rights, and don’t care about domestic violence. That’s the one and only difference which went into these decisions – how the subject of each case squared with their non-judicial ideology. The judicial ideology almost without exception is servant to the political ideology. Scalia’s anti-federalist vote in Gonzales was a spotlight example of how fraudulent his ideological pretensions are. He simply doesn’t like marijuana, period.

 

The decision admits the novelty of the case.

 

Plaintiffs in the present case focus on the common fact that each
of the regulations that survived Supreme Court scrutiny under the Commerce Clause
regulated an economic “activity,” as opposed to the “inactivity” they have demonstrated by
merely existing and not purchasing health care insurance. The Supreme Court has always
required an economic or commercial component in order to uphold an act under the
Commerce Clause. The Court has never needed to address the activity/inactivity
distinction advanced by plaintiffs because in every Commerce Clause case presented thus
far, there has been some sort of activity. (p.15)

 

To get around this the judge engages in what he himself calls “mental gymnastics”, and more fraudulent divination of Congressional intent.

 

Now we get to the core of obscenity:

 

The health care market is unlike other markets. No one can guarantee his or her
health, or ensure that he or she will never participate in the health care market. Indeed, the
opposite is nearly always true. The question is how participants in the health care market
pay for medical expenses – through insurance, or through an attempt to pay out of pocket
with a backstop of uncompensated care funded by third parties. This phenomenon of costshifting
is what makes the health care market unique.
(p. 16)

 

Think about that sentence, the two allegedly equivalent and interlinked propositions:

 

“No one can guarantee health..” That’s self-evident.

 

“…or ensure that he or she will never participate in the health care market.”

 

What? We could ensure we don’t have to participate in a criminal market by getting rid of it. We could, for example, institute Single Payer, which would cost far less, provide far more care far more efficiently, and would even solve that alleged individual free rider issue the likes of the judge claim to have such a fetish about. It would not be a moral affront to the people, as it would eradicate the free riding parasite rackets. We’d be free of their depredations and extortions.

 

But the decision depicts this “market” as a law of the universe. It would be hard to imagine a more grotesque example of begging the question. I don’t know if the conservative plaintiffs themselves care, but in the case of we who reject the Mandate on citizenship grounds, we reject any constitutional basis for the entire system based on private health “insurance”. We didn’t try to sue over it before (and of course we would have lacked “standing”), so long as we had the option of non-participation.

 

But now we’re going to have to sue against this Mandate. But when we declare* the Mandate unconstitutional, we’re saying that’s the most aggressive unconstitutional manifestation of an extra-constitutional, outlaw system.

 

[* And we as citizens do declare it so. We do not beg a court to do so for us. We demand that if the courts really do serve the people, they'll ratify what we the people already know and declare.

 

Since the prospect that these suits will do the trick is dubious, we need to start preparing for citizen disobedience and resistance.]

 

So the judge’s rationale is non-responsive. (The fact that “the health care market is unlike other markets” is also proof that private health insurance itself is a conceptual and moral absurdity.) Especially as he moves on to a series of flippant absurdities.

 

As inseparable and integral members of the health care services market, plaintiffs have made a choice regarding the method of payment for the services they expect to receive. The government makes the apropos analogy of paying by credit card rather than by check.
(p. 17)

 

We are NOT “members of this market”. This market is an alien assault being artificially inflicted upon us. The “market” has absolutely nothing to do with health care. The two are completely separable and separated. Paying by “..credit card or check…” – when of course the real issue centers on the fact that it’s a mugger demanding this payment in the first place.

 

Similarly, plaintiffs in this case are participants in the
health care services market. They are not outside the market. While plaintiffs describe the
Commerce Clause power as reaching economic activity, the government’s characterization
of the Commerce Clause reaching economic decisions is more accurate.

 

We are NOT “participants”. We ARE “outside the market”. We are disenfranchised, coercively indentured subjects of this “market”. Victims.

 

What level of depravity does it take for someone to not only ignore the one fact of the case, but to turn around and accuse the victim of that very crime? What can decent people do with a criminal like that?

 

Now he comes to his decision, and his ultimate lie:

 

The Act regulates a broader interstate market in health care services. This is not
a market created by Congress, it is one created by the fundamental need for health care
and the necessity of paying for such services received. The provision at issue addresses
cost-shifting in those markets and operates as an essential part of a comprehensive
regulatory scheme. The uninsured, like plaintiffs, benefit from the “guaranteed issue”
provision in the Act, which enables them to become insured even when they are already
sick. This benefit makes imposing the minimum coverage provision appropriate. (p. 18)

 

This is incontrovertibly a market created by Congress. On its face that’s a clear fact. The bill’s very purpose is to bail out the rackets who, even though they have an anti-trust exemption (another creation of Congress), and can therefore quash innovation and competition, are increasingly unable to compete with non-participation, which more and more Americans are rationally choosing, as is their constitutional right as citizens. The purpose of this bill is to eliminate this competition as well. The purpose of this decision is to eliminate our constitutional rights.

 

And once again, what we must always remember immediately, every time we hear anyone like this judge say a word about “shifting costs”, “third parties”, free riding, or any other “deadbeat” language, is the obscene fact that this “market” exists at all for one reason only. It’s to enable the parasitic extortions and extractions of this insurance racket which is indeed a third party to us all, which does nothing but shift costs to us all, free ride upon us all. That’s the one and only reason the bill exists at all. That’s the one and only reason this decision was made the way it was.

 

Every word of it is a crime against the Constitution, just like the bill itself. We are under the thumb of stateless, lawless, anti-sovereign predators. This Mandate is a major step forward for their criminal regime. As this incident makes clear, we cannot rely on the courts to help us uphold our constitution. We must do that ourselves.

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The Health Racket Mandate, Toward Other Corporate Mandates

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A few thoughts on the health racket mandate, for anyone who supports or knows someone who supports it, constitutionally and/or on policy grounds.

 

(This is also for anyone who’s wondering about my rage vs. liberals, as I expressed in this post earlier today, for example. Look at this mandate as a prime example of the incoherency and malevolence I describe.)

 

Let’s recap the history.

 

1. In the mid-20th century Congress granted antitrust exemptions to the health insurance racketeers, giving them monopolies or oligopolies in every state. This is a command economy, a forced market. The only alternative for most people is non-participation.

 

2. On account of this growing non-participation, as well as the desperate financial straits of many insurance rackets, especially post-2008, the government instituted a bailout of the sector, in the form of Obamacare. (It’s also an austerity policy and a union-busting measure.) This is Obama’s core policy. The funds for this bailout are to be extorted in the form of a poll tax imposed on human beings, as the price of their physical existence. (The mandated ”policies” themselves will be worthless, and subsidies to purchase them will never materialize.)

 

3. Supporters of this policy now argue that it’s constitutional, thanks to totalitarian commerce clause jurisprudence. I’ve extensively covered this here, here, and here. (For the health racket bailout and Stamp mandate in general, see my posts catalogued here.)

 

For anyone who supports this, please explain:

 

1. Does this mean that if Congress decides that proprietary GMOs are to be normative in the same way it has dictated for private health insurance, it can mandate purchase of these seeds by all growers? Impose penalties on heirloom seeds, or ban them? What about other agricultural inputs?

 

(See here for the shaky financial position of Monsanto. Pro-GMO Obama policy, tangibly accelerated right around the time Monsanto’s travails hit the papers, can already be seen as a Monsanto bailout. I’ll write more on this soon.)

 

2. Does this mean that if Congress decides that big box retailing is to be normative in the same way it has dictated for private health insurance, it can mandate shopping at Walmart and similar boxes (say, by having the IRS require receipts)? Can it penalize or ban independent retailers?

 

(See here for Walmart’s increasing market difficulties.)

 

Not for a moment do I mean for either of these examples to be taken as hyperbole or in any Swiftian sense. If the health racket mandate can be enacted, then both of these, and any number of comparable policies, would be enactable by the same logic. I have no doubt about the system’s will to enact any such policy, limited only by whatever political fears it may have.

 

 

Everywhere We See the Pattern

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1. The system is based on dependency, conformism, submission.

 

2. The system uses money to render its own processes and products “cheaper” than the “more expensive” age-old human ways of life, in food, manufacture, education, politics, culture, and many others.

 

3. The system ways are actually far more expensive than the human ways, but are temporarily rendered cheaper by shifting most of the costs to hidden taxes on the consumer, to various dispossessed groups, to the environment, and to the future. The system cheapness is nothing but accounting fraud.

 

4. For example, the system uses taxpayer money to subsidize its ways and render them cheaper. This has the dual effect of rendering the human way of life more expensive even as we’re forced to pay from our ever-diminishing financial base to subsidize the system which assaults us. 

 

5. To repeat, the fact that we have to look to our “finances” is a purely artificial state of affairs imposed upon us from the top down. Money is unnecessary and undesirable from any point of view other than that of the 1%. It’s part of a command economy.

 

6. So we must be clear that this government and the economic system it imposes comprise an artificial tyranny. It has no legitimacy, and on a practical level it never helps us, but only harms us. We’d be far better off without it.

Corporatism is Legalized Crime

 

As Ted Nace points out early in his survey of corporatism, Gangs of America, the worst crimes of corporations seldom involve technical breaking of the law or the personal evil of corporate executives, but the pattern of destructive anti-social activity which corporatism (and its corrupted system of “law”) enshrines in principle as normal and normative. Corporatism is in fact the ideology and practice of formally enshrined organized crime.

 

The banks recently crashed the real economy, and permanent joblessness (including the waste of life termed “underemployment”) creeps toward and over 20% according to the measure. This destruction of the basis of our lives is a calculated, intentional corporate-dictated policy. Today we see quarter after quarter of corporations reporting record levels of “profit”, building up record cash hoards, and their executives personally looting these corporate hoards in the form of “bonuses”. All this even though the original stated purpose of the Bailout was to get liquidity circulating again. Today, not only does the government tolerate what’s obviously fraudulent accounting, disaster profiteering, and the obstinate refusal of corporate elites to live up to the terms of the Bailout. (I include all corporate sectors among the bailed out, since the bankster and government allegation was that all sectors would perish unless the TBTF banks were bailed out, and no other sector dissented from this, because they all expected the Bailout to trickle down to at least their own stock prices and exec comp.)

 

Not only does it do this, but it proclaims that this “jobless recovery” is in fact the real recovery they intended all along. Thus we have the same history as in Iraq: The initial rationale is proven to have been a Big Lie. The government then starts inventing new rationales ad hoc, temporarily proclaiming victory according to each, until forced by reality to move on to the next, further attenuated rationale and metric.

 

So we have Sodom-like corporate profiteering as the real economy continues to deteriorate, indeed in inverse proportion to the rising calls for “austerity”, that public amenities and civil society need to be gutted because there’s not enough existing wealth to support them.

 

Corporate profiteering and personal looting by executives, vs. austerity. This ratio is a direct metric of organized crime. It’s nothing but monumental, capital crime. Corporatism is the system of command economy, and trickle-down is ideology meant to justify it. But corporatism is nothing but robbery, and trickle-down nothing but the verbal part of fraud. Advocacy of it abets capital robbery. This incriminates both Washington gangs, the entire MSM, most of academia, and conservatism and liberalism as a whole.

 

In a formula:

 

Capitalism = corporatism and trickle-down = organized crime.

 

This is not a new kind of corporate behavior. Privateering, the formal charter to commit crimes, goes back to the 16th century, the dawn of the corporate form. Corporations were envisioned in the first place to help enable “violent crime grafted onto trade”, as Nace put it. The very term “free trade” originally referred directly to freedom from the law. Or as Hannah Arendt wrote in Origins of Totalitarianism, legalized gangsters sought to use politics to regulate their bloodshed. The British East India Company’s violent lawlessness is exactly mirrored today in the form every sort of corporate thuggery and the way corporate crimes are generally considered above and outside the law. Blackwater, explicitly declared above the law and granted a charter to literally perpetrate massacres, is merely the distillation of the way every large corporation is empowered to act, and the way they usually do act. Indeed, in principle this is the way they are required to act according to the core principle that profit-seeking is the only acceptable value. (The question of what kind of sick society would ever have enshrined such a sociopathic form in the first place I’ll leave for another time. But I’ll say here that the very existence of profit-seeking corporations reflects a self-loathing and self-destructiveness on the part of civilization itself.)

 

Today’s “free trade” has exactly the same criminal nature, but the term has been sanitized to refer to an economic theory rather than a legal concept of chartered outlawry.

 

Today it’s true in a precise sense that corporations are formally legalized criminal organizations. Take for example the repeal of the bucket laws, which used to recognize gambling as gambling whether done over dice in a back alley or stocks on an exchange. A bank couldn’t ask the state to enforce a wager any more than a two-bit hood. But these sane laws started being repealed in the 1980s. The process culminated in the CFMA in 2000. Now what was naturally unproductive antisocial gambling was legalized as a “contract”. The result was massively bloated bank profits and hideous distortions of the economy, climaxing in the crash of the real economy. (This is the intended culmination of financialization itself.) The crash was then used as the pretext for the Bailout and austerity. This entire process was premeditated and had its origin in the legalization of what are naturally outlawed acts. The massive conspiracy, dating back to the 90s, to fraudulently induce mortgages was enabled by this original legalization. And the rest of the crimes were piggybacked on these.

 

This is both the most extremely destructive and the most typical of the formal legalizations of organized crime which are bound up in the corporate form. While many of the subsequent crimes may still technically be illegal, they were enabled by the underlying legalization of gambling. (And once the government has been corrupted enough, even existing laws are no longer enforced, as we see every day. This is simply the de facto legalization of corporate crime.)

 

Yet today most people fail to see this. The magnitude of the crime, and the government imprimatur accorded it, is such that it becomes hard to register. Pro-corporate propaganda and indoctrination reinforce this self-obfuscation. This is what Hitler intended with his doctrine of the Big Lie. (This same magnitude of crime enabled by the hijacked law and corrupted polity also renders it impossible for the existing system of law to rein such crimes back in and impose any deserved justice. When the day comes that the people finally take back their country from such criminals, nothing short of a Nuremburg-level proceeding is sufficient to the task of justice.)

 

So we have a regime where responsibility for every crime, the robbery of trillions, international murder, slavery, the ravaging of the environment, conspiracies against plant genomes, and anything else profitable, are either directly legalized at the corporate behest or else laundered through the corporate form and dissolved.

 

All this is within the prescribed use of corporations. These are not “abuses”.

 

Here’s another example. Corporations serve as the underlying for the stock market. The stock market has a fraudulent basis in the first place, since only the first offering actually raises capital. The rest is just the same legalized gambling. It has never been anything but socially and economically destructive. And by what reality-based measure does stock price reflect value at all? Yet once you enshrine it as the most important measure of value, control fraud becomes ideologically justified. From there the next step is to change the law and/or regulation itself. Again, organized crime becomes legalized.

 

One of the ways the law gets changed is through pro-corporate SCOTUS decisions, like the recent one striking down most of the enforcement potential* of the “honest services” law, which was a modest attempt to retain some criminal liability for the most egregious executive fraud. This is just one example of how corporate power has corrupted our institutions, that even in the rare cases where the legislative branch tries to do part of its job, the judiciary blocks it.

 

[*In my previous corporatism post I referred to the double standard of law and jurisprudence enshrined by the SCOTUS where it comes to corporate speech. Corporate speech "rights" are interpreted extremely loosely, while at the same moment, in the same cases, corruption is interpreted with extreme pedantry. If there's not a physical sack with a dollar sign drawn on it, it's not corruption.

 

The SCOTUS just applied this same strict standard of "corruption" in the honest services case, declaring that the law is constitutional only where applied to explicit kickbacks and such. Obviously, this is meant to gut the law in practice, since today's corruption is generally more sophisticated than that. But SCOTUS jurisprudence is designed to let all implicit corruption elude accountability.]

 

We’ll soon find out what’s the latest from the SCOTUS on unconscionable contracts of adhesion, extortionate ”contracts” forced upon us through the coercion of monopoly and artificially created economic hardship. These strong-arm contracts are increasingly popular, and are imposed anywhere the corporations attain the position of dominance which enables them. In theory such contracts, just like gambling, are supposed to be unenforceable, uncontracts. But here too the SCOTUS has usually served as the corporate goon. The Lochner era was based upon the legalization of “contract” extortion, and although the court nominally abandoned this doctrine in 1937, in practice courts almost always still find such contracts valid. In the case of AT&T vs. Concepcion, AT&T’s thefts were so outrageous that the lower courts found the contracts it imposed, forestalling its victims to combine to sue as a class, to be unconscionable. But this will be the SCOTUS’ big chance to restore Lochner as official court doctrine. 

 

Meanwhile government contractors, starting with the weapons rackets, are implicitly encouraged to bilk the taxpayer out of billions. By now it’s not conventional corruption but systematic corporatist robbery, with the DoD and other agencies as bagmen. Robert Gates once explicitly told an audience of weapons racketeers that where it comes to the military Obama’s top priority is an ever-escalating Pentagon budget as such, as a value in its own right.

 

Those are just a few examples of systematic corruption, i.e. organized crime. The term kleptocracy should be understood in a profound way. Corporatism comprises a new paradigm of criminal practices, and the pro-corporate mindset is a characteristic, immutable criminal mindset. It’s not just a set of criminal actions, but an indelible criminal essence. It’s the mindset that we can no longer exist at all without being totally controlled by corporations, having all we produce monopolized and stolen by corporations, and submitting at every moment to corporate imperatives even in our very thoughts. The elites, for obvious reasons, believe this themselves. The system they’ve set up is dedicated to enforcing this corporate totalitarianism from the top down. The corporations themselves have no purpose at all except to preserve and intensify this kleptocracy, and to keep stealing.

 

But we know that we don’t need corporations to have a vibrant, productive economy. We know we’d be far more productive without them. Without them we would restore our prosperity, our communities, our social morality, and our democracy. The only thing in the way of our redeeming our humanity and saving our lives and freedom are a few gangsters, organized as big corporations. The corporate form is what enables this in the first place. Let’s abolish it. 

Capitalism = Corporatism = Oligopoly = Rentier Stagnation

 

In theory capitalism was supposed to unleash such innovation and efficiency that in every sector the optimal combination of quality and quantity would soon be achieved. Capitalism was also supposed to tear down all barriers to marketplace entry, and all these innovations and efficiencies would eventually become standard practice (IP was never meant to do anything but give a particular innovator a temporary advantage, as a finite reward for his innovation).

 

What was the result of this supposed to be? If all went according to theory (if everyone really acted as a good capitalist, a fair competitor), each sector would eventuate in the sale of undifferentiated commodities. Since no one would be able to charge more for his product than his competitor did for the identical product, the price of everything would fall to cost. This is capitalism’s inherently declining rate of profit. Profit is in fact supposed to wither to the bare minimum necessary to keep business functional at all. That’s what would have happened by the 1970s in most sectors, and by today in all of them, if capitalism functioned in reality the way it does in theory.

 

But as we know it never functioned this way in reality. In practice, there’s no such thing as a “capitalist”, if the definition of that is one who competes and wants to compete according to the textbook rules. In practice, no competitor ever competes for a single day longer than he has to. The moment he achieves sufficient leverage to use his market muscle to engage in every kind of anti-competitive behavior and in particular to get support from the government goon, he does so. This is what I call the Rule of Rackets. In practice all capitalists are actually aspiring racketeers.

 

So in capitalist reality the tendency has always been toward oligopoly and monopoly. This was always desirable for profitability reasons. And since modern capitalism’s profit rate reached its dead end, oligopoly has become a necessity if firms are to remain profitable at all. By now capitalism is not just in a struggle for power, but a struggle to survive. This is related to the fact that it’s also no longer possible for capitalism to rob one population and/or resource base, achieving a capital accumulation, in order to market to another consumer base. All consumer bases are now exhausted, and there are no new resource bases. The only enclosure left is the terminal one, restoring feudal calcification. So this too dictates stagnant oligopoly as the only order which can still extract profit.

 

I contend that corporations have always been the main instrument of this drive toward oligopoly, and they have been the only significant modern form of it. It would have been difficult if not impossible for Oil Age economic actors to achieve oligopoly if not for the way the corporate form tilted the playing field and rigged the markets. Cheap, plentiful oil in itself would have been a radically democratizing force. (Who knows? Perhaps textbook “free markets” could even have thrived.) Only a severe artificial restriction on economic freedom could ever have enabled oligopolies to cohere. This artifice was the corporation.

 

Similarly, modern technology, whatever its other issues, would have been a tremendously liberating egalitarian force if not artificially enclosed and controlled. The corporate form was the main mode of this enclosure.

 

In all ways legally and politically possible, corporations have monopolized the vast bounty and freedom which fossil fuels and the modern human mind held in potential. Privatization of public commons like the resources of the earth, including fossil fuels, is at one, physical extreme. The radical extension of the IP regime to the point that it constitutes a new enclosure of a potentially infinite public commons is at the other extreme of intellect and spirit. In both cases, and all in between, there’s been little of private individual involvement. In every case I can think of, the corporate form is preferred. Certainly if the genius of capitalism could conceive of a non-corporatized way to compete, someone would be doing it.

 

Not only is the corporation the most efficient wealth-extracting machine. By design it’s forbidden to do anything but all it can to maximize its extractions. According to the responsibility of management to shareholders, a corporation is required to subvert the rules of capitalist competition. If the more effective expenditure for short-term gain in lobbying for anti-competitive legislation or regulatory treatment, that must be chosen over longer-term research investment. Same for the mergers and acquisitions and offshoring which we know are so destructive and serve no purpose even from the “capitalist” point of view, but which can accomplish a short-term goosing of the stock price.

 

It’s clear that in reality capitalism always seeks oligopoly; that corporatism is the only viable form of oligopoly under the conditions of the Oil Age and now energy descent; and therefore that capitalism is synonymous with corporatism. And as corporations become dominant, and as they’re purely artificial, the sum result is that corporatism is a command economy, every bit as much as that of the Soviet Union.

 

And what’s the result of this command economy devoted to unproductive extraction? Even as permanent mass unemployment becomes politically normalized, and we’re bombarded by vicious “austerity” assaults and their accompanying deficit terror propaganda, corporations continue to report record “profits”. These profits are all fraudulent. They’re the result of straight accounting fraud (all bank “profits”, for example), the fraudulent return on looting the taxpayer (the Bailout, Pentagon budgets, and all other corporate welfare), and cannibalization – cutting jobs, “consolidation”, spin-offs or M&A money shuffles, tax scams, etc. I don’t know how many years it’s been since I saw a corporation of any significant size report an actual profit, and the looting regime has only become more brazen since the intentionally triggered crash. What we’ve seen since 2008 has been nothing but disaster capitalism, disaster profiteering, disaster looting, disaster rioting. That the banks, or any corporation, are paying dividends at all under depression circumstances is proof that they serve no constructive social or economic purpose and therefore shouldn’t be allowed to exist at all. Who can possibly argue a rationale for corporate profit-taking, dividend-paying, and cash-hoarding even as they cut jobs and government slash spending? On its face, if nothing else this proves the corporate worthlessness. It proves they existentially comprise a bottleneck preventing the solution of any of civilization’s problems. They comprise a roadblock against the further evolution of civilization. 

 

Corporations are responsible for all of this, and all of this is their characteristic activity. They are oligopolist and rent-seeking by design.

 

So it follows that if we wish to economically liberate ourselves, whether we dream of economic cooperation or of true markets (I don’t claim the two are necessarily incompatible), either way we face the same enemy and the same imperative. We must break corporate power. At the very least we must radically restrict corporate prerogatives and abolish all corporate constitutional “rights”. Better, we should abolish corporations completely. We no longer need even original-style corporations. We can maintain whatever infrastructure we still need democratically. Things like railroads and canals were always built as joint public-private enterprises anyway, with the corporation’s main role being to parasitically extract the profit after the public pays for everything and does all the work. Most R&D today is in the same category. Democracy doesn’t need corporations, and cannot coexist with them.

 

The American revolutionaries sensed all of this. They were leery of federalized corporate chartering power, and of corporations in general. They experienced at first hand the aggressive monopoly of the British East India Company. They saw Thomas Hutchinson try to make his sons and cronies the monopoly distributors of price-dumped tea.

 

So they physically dumped it instead, and then kept corporations out of the Constitution.

 

Today we know how right they were, and how pathetically our own vigilance has flagged. If we’re to take back our country, we’ll have to reinvigorate the original spirit of the constitution and the revolution. Among other things, that means smashing the corporations. Shattering that blockage may in itself be sufficient to liberate our polities and economies, letting us resume our freedom and prosperity. It is certainly necessary.

Bailouts = Monopoly, Health Racket Version

 

I have a whole category dedicated to the fact that Bailouts Intensify Monopoly. We recall how, as soon as the TARP was on the books, Paulson and his people started saying, “our real intent is mergers and acquisitions, and we want the TARP and the rest of the bailout to help achieve this.” We want greater concentration, greater monopoly.

 

We’re already receiving confirmation that this is a core goal of Obama’s extension of the FIRE bailout to the health rackets. We’ve seen it with insurers, we’ve seen it with waivers and exemptions as an indirect tool toward concentration in general, in all sectors. Now we’re seeing it with providers as well.

 

Under the Orwellian name of “accountable care organizations”, hospitals and doctors in theory are supposed to combine to hold down costs and deliver better care. Under corporatist conditions, in practice this can only mean shift more costs onto patients and the people in general. Actually holding down costs is not a real goal; shifting them is. Indeed, the system encourages bloating costs. The smoking gun proof of this is that all “stakeholders” reject the one and only proven cost-cutting measure, Single Payer.

 

That proves that no one among the elites ever wanted to control costs or deliver better care. It proves that the very word “reform” was an Orwellian sham right from the inception.

 

When Congress passed the health care law, it envisioned doctors and hospitals joining forces, coordinating care and holding down costs, with the prospect of earning government bonuses for controlling costs.
Now, eight months into the new law there is a growing frenzy of mergers involving hospitals, clinics and doctor groups eager to share costs and savings, and cash in on the incentives. They, in turn, have deployed a small army of lawyers and lobbyists trying to persuade the Obama administration to relax or waive a body of older laws intended to thwart health care monopolies, and to protect against shoddy care and fraudulent billing of patients or Medicare.

 

No one who knows anything about the way the system works can be surprised by this for a second. Obama, the Dems, the liberal groups and bloggers, the MSM, Krugman – they all knew this is exactly what would happen. Therefore this is what they intended to have happen.

 

This is a form of disaster capitalism. Facing what’s in this case a real problem (often the problem itself is fake), you misdirect concern and use the problem as the pretext to not only extend the reach of greed, but to launch assaults on pre-existing safeguards. So here we see how Obamacare was, in addition to its many other crimes, a Trojan horse against existing anti-monopoly regulation.

 

Need I say it again? Under kleptocracy, regulation doesn’t work. You can never regulate oligopoly rackets. You can only destroy them.

 

And in this case, the “regulation” is designed to generate new rackets.

 

This is what we can expect from each and every policy advocated by liberals or conservatives. (Or in this case both, since Obamacare is just a rehash of the Heritage Foundation’s Romneycare. Obama himself called it a Republican policy.)

 

“If accountable care organizations end up stifling rather than unleashing competition,” said Jon Leibowitz, the chairman of the trade commission, “we will have let one of the great opportunities for health care reform slip away.”

 

There’s Orwell again in that quote. This is the shock doctrine ”opportunity”. Remember what Rahm said about not letting a crisis go to waste?

 

The law itself is inherently reactionary, and now it’s being applied in further reactionary ways, to gut what little regulation existed in the first place:

 

Elizabeth B. Gilbertson, chief strategist of a union health plan for hotel and restaurant employees, also worries that the consolidation of health care providers could lead to higher prices.

“In some markets,” Ms. Gilbertson said, “the dominant hospital is like the sun at the center of the solar system. It owns physician groups, surgery centers, labs and pharmacies. Accountable care organizations bring more planets into the system and strengthen the bonds between them, making the whole entity more powerful, with a commensurate ability to raise prices.”

She added, “That is a terrible threat.”

Doctors and hospitals say the promise of these organizations cannot be fully realized unless they get broad waivers and exemptions from the government.

The American Medical Association has urged federal officials to “provide explicit exceptions to the antitrust laws” for doctors who participate in the new entities. The F.T.C. has accused doctors in many parts of the country of trying to fix prices by collectively negotiating fees — even though the doctors do not share financial risk and are supposedly competing with one another.

Hospitals and doctors have also asked the administration to waive laws intended to prevent fraud and abuse in Medicare.

In a recent letter to federal officials, Charles N. Kahn III, president of the Federation of American Hospitals, said, “To provide a fertile field to develop truly innovative, coordinated-care models, the fraud and abuse laws should be waived altogether.”

These laws are an impediment and, in some cases, “a total barrier” to creation of accountable care organizations, Mr. Kahn said, making it difficult for hospitals to reward doctors for cutting costs or following best practices.

 

It’s a lie that anyone wanted to cut costs, just like it’s a lie that anyone cares about deficits. Anyone who wants to cut health care costs wants Single Payer. Anyone who cares about the deficit wants Single Payer.

 

A major purpose of accountable care organizations is to encourage doctors to work closely with selected hospitals, and the rewards paid to doctors — typically, a percentage of the money saved — could run afoul of this law, hospitals and doctors say.

Dr. Donald M. Berwick, the administrator of the Centers for Medicare and Medicaid Services, hails the benefits of “integrated care.” But, Dr. Berwick said, “we need to assure both patients and society at large that destructive, exploitative and costly forms of collusion and monopolistic behaviors do not emerge and thrive, disguised as cooperation.”

 

But this monopoly was part of the purpose of the law. We see it right there – the law’s impetus runs directly counter to all existing antitrust legislation. (Of course, the Stamp rackets already had an antitrust exemption, which the bill wants to help them leverage even further.) Just like all the other bailouts, it rewards monopoly and wants further monopoly. This is what Obama wanted, this is what the Democrats wanted, and going forward this is clearly what any supporter of the whole policy wants.

 

But liberal myopics are congenitally incapable of understanding this.

 

Peter W. Thomas, a lawyer for the Consortium for Citizens with Disabilities, a national advocacy group, expressed concern about the impact on patients.

“In an environment where health care providers are financially rewarded for keeping costs down,” he said, “anyone who has a disability or a chronic condition, anyone who requires specialized or complex care, needs to worry about getting access to appropriate technology, medical devices and rehabilitation. You don’t want to save money on the backs of people with disabilities and chronic conditions.”

 

He’s unable to understand the underlying, immutable conflict of interest which defines the system. It’s intractable. You will the end, you will the means. Obviously the system “wants” to do this. And if you don’t want that result, you have to reject the entire system.

 

If you want decent health care for all the people, then you have to want and fight for Single Payer. If you don’t want Single Payer, you don’t want non-rich people to get care at all. 

The Health Racket Bailout

 

In September 2009 Obama declared, regarding the private health insurance rackets, “I believe it makes more sense to build on what works and fix what doesn’t, rather than try to build an entirely new system from scratch.” What kind of coded message is this? Since the system of paying for health care by forcing payments through this racket has long been a complete disaster from any rational or moral point of view, since in other words nothing works about this system except for the profit extractions on the part of unproductive gangsters, we have to assume it’s the good of these criminals which is what Obama meant by “what works”, and any threat to this extorted revenue stream is what doesn’t work.

 

(This can go as a general rule for any neoliberal policy. Since all of neoliberalism and trickle down has profoundly and definitively failed as far as the good of the people goes, it’s a given that ANY politician, advocate, or wonk, conservative or liberal, who still calls for corporatist policy is consciously and treasonously seeking the good of corporate criminals at the expense and harm of the American people.)

 

What was this health racket debacle all about? How did what sounded like a worthy endeavor – health care reform – end in such disaster? Why was the only real reform, single payer, excluded? It’s an axiom that anyone who truly wanted reform demanded single payer. This is true by definition for anyone familiar with the issue, as were all the politicians and advocates who swarmed over the corpse of it starting in spring of 2009. Yet it was never for a moment even considered by the political structure. Obama unilaterally declared it “off the table” before the alleged negotiation even began.

 

This proves that they never even considered actually reforming anything. They never intended to reform anything. It’s absurd on its face that a sincere reformer would’ve given up single payer without putting up a fierce fight for it. This applies to Obama, this applies to the Democratic establishment in Congress, this applies to all “progressive” advocacy groups, professional bloggers, etc. This applies to everyone who conspired in the “public option” bait-and-switch. Whatever they all meant by the term “reform”, they did not mean reform. So what did they intend?

 

Look at the process, at the deals Obama struck with the insurance and drug rackets before the “negotiation” even began, the deals which were further worked to the rackets’ advantage throughout the process as the Democrats and liberal hacks steadily sold out every position, replaced every previous lie with an even more threadbare, empty lie. If we look at this and at the end result, we see that Obama and the Democrats/liberals’ real goal was this:

 

1. Further entrench and empower the insurance rackets.

 

2. Increase the rackets’ extractions (profits) from the economy.

 

3. Empower the rackets to use force to directly rob the unwilling people.

 

This will be done through a mandate to buy expensive but worthless “insurance” which can never be used. A mafia hoodlum sticking up the neighborhood grocery for his weekly protection money might as a joke hand back a Neighborhood Watch decal which would serve the same purpose. That’s all this “insurance policy” is – a worthless piece of paper the mafia thug gives you as he mugs you.

 

Why did Obama and the Democrats do this? Exactly for the same reason Republicans and Democrats came together to bail out Wall Street in 2008. Just like the Wall Street banks, the health insuracne companies are unproductive parasites. Just as the Wall Street banks are insolvent, so the insurance rackets face insolvency. Just like Wall Street they needed to be bailed out.

 

The difference is that instead of fashioning a health insurance TARP to cover them, the neoliberals came up with this mandate. But if we picture, instead of using the TARP and Fed facilities to convey taxpayer loot to the banks, the government simply forced all of us purchase some extremely expensive worthless “service” from the banks, it would be the same thing.

 

Everything the health insurance companies do is counterproductive, socially destructive, and worthless. As Luke Mitchell put it in his excellent Harper’s investigation,

 

The private insurance industry, as currently constituted, would collapse if the government allowed real competition. The companies offer no real value and so instead must create a regulatory system that virtually mandates their existence and will soon actually do so.

 

Health “insurance” make no sense even as a concept. In practice it’s an undifferentiated commodity. In principle anyone with a computer can provide this service. But regulatory barriers to entry plus the insurance rackets’ explicit 1945 exemption from antitrust laws have enabled them to set up legally enforced oligopolies and monopolies all over America. In many places there’s only one company dominating the marketplace, in many more two collude. In the great majority of markets there are no more than two “competitors” who don’t compete. What happens when something is of little value but is subject to extortionate monopoly pricing? The consumer rationally chooses not to buy it.

 

As Randall Wray put it:

 

Here is what the whole “reform” was all about: health insurers were losing premiums because employers were dropping coverage (in part because they could not compete since no comparable country uses private insurance to provide health care); healthy individuals were dropping because no reasonable calculation could show insurance to be good value for the money. And it is not just the healthy young people who were dropping coverage. If you are single and have no chronic conditions, you are far better to pay out-of-pocket (UNLESS your employer pays most of the premiums and will not give you wages instead). 80% of healthcare costs are due to the 20% of the population that is unhealthy and perhaps unlucky. If you can make it to age 65 without chronic conditions (you don’t smoke, are not obese, were not born with too many preexisting conditions, and so on) it is quite rational to avoid health insurance. And if you get extremely unlucky, you do not have to have health insurance to get some kind of health care. Sure it is probably going to be inferior—but it could well be adequate. And in any case, you might not have that much faith in traditional medical approaches, anyway.

 

So while the insurance rackets can lounge in their monopoly fortress safe from all marketplace competition, they can’t compete with rational non-participation on the part of the consumer. So from the advent of the health “reform” notion, they’ve sought some kind of neoliberal arrangement. The basic concept, from Hillarycare to the far more vicious Obamacare*, is the same: the insurers will nominally “cover” everyone, and the government will act as enforcer, to destroy the non-participation option. The consumer will be strong-armed into the monopoly “market”.

 

[*Obamacare is actually almost identical to the Heritage Foundation-written Republican counter-proposal to Hillarycare.]

 

But the insurers were terrified. They could see the writing on the wall–they were losing the healthiest members from their pool, forced to raise rates, and that pushed more healthy people out in a vicious cycle. Hence, they went after Hillary Clinton and later Obama to get a HIBOB to force healthy people back into the pools so they would pay premiums. Yes, insurers knew there would be a trade-off because they’d have to take some unhealthy people. But giving them insurance IS NOT THE SAME THING AS paying for their care. So insurers agreed to accept some pre-existing conditions but never agreed to actually pay for treatments for those conditions. And they won’t.

 

The Obama bill will have the added virtue of helping further entrench this monopoly. As we’re already seeing, many smaller insurers are getting out of the business because they see themselves as unable to compete under the new rules, which were intentionally calibrated to be easily gamed by the big rackets but be very difficult for the smaller ones.

 

More insurers are likely to follow Principal’s lead, especially as they try to meet the new rules that require plans to spend at least 80 cents of every dollar they collect in premiums on the welfare of their customers. Many of the big insurers have been lobbying federal officials to forestall or drastically alter those rules.

“It’s just going to drive the little guys out,” said Robert Laszewski, a health policy consultant in Alexandria, Va. Smaller players like Principal in states like Iowa, Missouri and elsewhere will not be able to compete because they do not have the resources and economies of scale of players like UnitedHealth, which is among the nation’s largest health insurers.

Mr. Laszewski is worried that the ensuing concentration is likely to lead to higher prices because large players will no longer face the competition from the smaller plans. “It’s just the UnitedHealthcare full employment act,” he said.

 

Sound familiar? It’s just like with Wall Street, where Paulson explicitly stated that one of the goals of the Bailout was to enforce further concentration via M&A’s. It’s also exactly like the slew of food tyranny bills which all have the same intent of setting up one-size-fits-all barriers which are speed-bumps at worst for the big producers, insurmountable cliffs for small ones. In every such case this is the legislative intent. We see the criminal malice of policy-makers.

 

Here’s another take from the Harper’s piece:

 

[This] is one reason why the insurers themselves have always favored the central elements of the Democratic plan. As long ago as 1992, when Hillary Clinton was formulating her own approach to reform, the Health Insurance Association of America (now America’s Health Insurance Plans, or AHIP) announced that insurers would agree to sell insurance to everyone, regardless of medical condition (guaranteed issue) if the government required every American to buy that insurance, and used tax dollars to subsidize those who could not afford to do so (universal mandate). Carl Schramm, the president of the association, said this was the “only way you preserve the private health-insurance industry. It’s plain-out enlightened self–interest.” The deal collapsed nonetheless, in part because Congress wanted to introduce a “community rating” system that would have put an end to underwriting by making insurers sell insurance to everybody in a given community for the same price. Insurers wanted to maintain the profitable ability to charge different prices to different people.

Last December, though, AHIP said it would support community rating as well….The insurance companies would agree to sell their undifferentiated commodity to all people, no matter how sick, if the government agreed to require all people, no matter how healthy, to buy their undifferentiated commodity. Sick people who need insurance get insurance and healthy people who don’t need insurance cover the cost. A universal mandate would include the 47 million uninsured—47 million new customers.

The Democratic plan looks to be a huge windfall for the insurance companies. How big is not known, but as BusinessWeek reported in August, “No matter what specifics emerge in the voluminous bill Congress may send to President Obama this fall, the insurance industry will emerge more profitable.” The magazine quoted an unnamed aide to the Senate Finance Committee who said, “The bottom line is that health reform would lead to increased revenues and profits.”

 

So the insurers propose to get out of the fraudulent “insurance” (which was never insurance) business completely and instead to simply administer the community rating pool, even though this involves no actual work which could justify a profit. They simply steal from the pool, and this is justified and enabled by their co-conspirators, the criminal politicians and public opinion leaders. They justify it by privatization ideology (in no way can such leeching be called “capitalism” – it’s simply privatization for its own sake, no matter how inefficient, no matter how unproductive). But it’s really simple corruption. Simple crime.

 

In return for this great favor the insurance rackets are doing for their political flunkeys, they demand the extortion mandate.

 

So to recap, the insurance rackets are pure parasites. They provide no worthwhile service. On the contrary they only generate needless cost and complexity. They shouldn’t exist at all. For most people “health insurance” is a bad buy. More and more people understand this and are rationally opting out. This is a mortal danger to the insurance rackets. So they’ve bought politicians and pundits from both Washington gangs. These corrupt policy-makers see their task as to bail out the rackets’ position. (This fits in with their neoliberal corporate ideology, according to which the very purpose of a society is to serve as a resource for corporate racket extractions.) The basic idea is to create one vast social pool. All Americans will be forced into it. The monopoly rackets will have total power over it – to “administer” it, but really to simply squeeze as much blood as possible out of it. Not only will the government not protect the people against these vicious gangster assaults, it will serve as the hired thug. The result, by design, will be that although more people will be nominally “insured”, far fewer will have access to affordable care. The plan is systematic plunder. With this bill the insurance rackets are to be officially one of the favored, “senior tranche” looters on the corporatist totem pole, just below the banks and the weapons racket.

 

The key to this is the mandate. the key to fighting back is resisting the mandate. My basic idea is as follows:

 

1. We won’t be able to pay the mandate even if we were willing to knuckle under and crawl (but no citizen would be willing). We’re entering the terminal Second Great Depression.

 

2. The IRS as insurance goon will be assailing us for this penalty. (Not to mention other modes of social control the bill will seek to use the IRS to enforce.)

 

3. So if we want to resist we’ll have to do it in part by resorting more to the informal economy.

 

4. The Depression and high permanent unemployment will be forcing us into the informal economy anyway.

 

5. These two forcings will be in the same direction as what we should already feel as our democratic and economic imperative toward political and economic decentralization and relocalization. This is our affirmative imperative.

 

6. So we should make a virtue of necessity and combine self-defense with affirmation.

 

7. So educating people about the mandate - about how it’s a political and moral obscenity, and how it’s nothing but a robbery they cannot afford - can be the lead-in and accompaniment to a more general, affirmative education campaign about decentralization and relocalization.

 

Is see many possible lead-ins to this. The great push to represent the health racket mandate as our Stamp Act should be a primary one. But all roads lead to the same end – we the people must take back our political and economic self-determination, or die.

How A “Great Recession” Is Lied to an End (Zandi and Blinder)

 

Yesterday saw the release of a report, “the first of [its] kind”, purporting to gauge the “comprehensive…effects of the financial-market policies”, i.e. the Bailout including the Obama corporate stimulus, on the economy.

 

It’s really just a propaganda broadside, written by two hacks, the appropriately named Alan Blinder, and Moody’s own Mark Zandi. It goes without saying that we regard Moody’s with all the respect it deserves, and especially its much-vaunted (by Zandi in this paper) “Analytics Model”, which they used for the report, is supposed to inspire not laughter but awe. (It’s also encouraging to learn that their methodology is similar to that used by the administration and the CBO, and that the results obtained were similar. Now that’s good company.)

 

I won’t bother parsing their phony baloney numbers, since I’m instead going to focus on the ideology of the piece. But their basic claim is that without the government’s actions, “GDP in 2010 would be about 11.5% lower, employment would be less by some 8.5 million jobs, and the nation would now be experiencing deflation.” They believe most of this effect is from the Bailout proper, with some added effect from the stimulus.

 

This tabloid sure has a flashy title: “How the Great Recession Was Brought to an End”. So evidently “great recession” is their term for the GDP hiccup as the Bailout took over from the “normal”, “Great Moderation” version of neoliberal kleptocracy; kleptocracy 1.0. So at least when it comes from Obama hacks we can range that term alongside “jobless recovery”, since that’s the “recovery” being hailed in this piece, the alleged “end” of this “Great Recession.” The recovery is jobless, all right; everything the administration says and does is intended to normalize permanent unemployment at >9% (the bogus U3), closer to c. 20 % (U6). This report says (p.19) that while the NAIRU is currently decreed to be 5.5%, the real goal is to normalize at 9%. Thus this paper can cheerfully feature >9% unemployment through at least 2012 as part of the End of the Great Recession. Let the good times roll. (Meanwhile, if the Great Recession has really Ended, why is Obama leading this drumbeat for “austerity”? That sounds like a contradiction. Nowhere do Zandi and Blinder say anything like, “all this is predicated on gutting Social Security, the way “the markets” are allegedly demanding. But then, they omit a lot of things, as I’ll get to shortly.)

 

What are the basic premises of this tract? What reality does it deny?

 

Most of all, it denies the astronomical bloat of housing prices and all the toxic assets derived from these prices. Without the Bailout “the nation would now be experiencing deflation”? (p.1) The nation has to experience deflation. That’s a law of reality where your prices were blown up to become an $8 trillion bubble. But ZB (ZandiBlinder) says insolvent assets should be propped up. “The volume of transactions was small, but the TALF appears to have improved the pricing of these assets, thus reducing pressure on the system as a whole.” (p.11) (Until the next crash.)

 

Deflation must be the result as reality finally takes a hand. Exponential growth is unsustainable. So by ZB’s own contention the Bailout did nothing but temporarily stave off the inevitable, guaranteeing far worse destruction in the end, and having allowed untold trillions more in social wealth to have been destroyed by the banksters, and all for no purpose at all but to enable these criminals to continue looting. This is the Mission Accomplished ZB celebrates. Their basic method in deriving all these conclusions is founded in (and founders upon) a metric of the exponential debt machine.

 

Our basic approach was to treat the financial policies as ways to reduce credit spreads, particularly the three credit spreads that play key roles in the Moody’s Analytics model: The so-called TED spread between three-month Libor and three-month Treasury bills; the spread between fixed mortgage
rates and 10-year Treasury bonds; and the “junk bond” (below investment grade) spread over Treasury bonds. All three of these spreads rose alarmingly during the crisis, but came tumbling down once the financial medicine was applied. The key question for us was how much of the decline in credit spreads to attribute to the policies, and here we tried several different assumptions. All of this is discussed in Appendix B.
(p.4)

 

Throughout the piece they propagate the fraudulent theme and term “recovery”, resorting constantly to class war obfuscations like “the U.S. economy”. Whose “economy”? Of course, measures like “GDP” in themselves, aside from all their other problems, fraudulently aggregate the positions of diametrically opposed interests locked in a zero sum struggle. Look again to the term “jobless recovery”, really think about it, really draw in a breath to sense how redolent of crime this all is.

 

What did this study project as the cost of the next crash? The next, far worse crash which has been rendered inevitable by the Bailout, but could have been averted by letting the permanently insolvent system crash once and for all then rather than later? Well, the “study” left that out. Obviously this study has zero validity unless it projects this cost and factors it in.

 

How did they estimate the Bailout’s ongoing cost? Scores of millions more daily? Even if one believed their numbers for the TARP, the facilities, and so on, what about those toxic MBS stinking up the balance sheets of the Fed and the GSEs, both officially authorized to embezzle taxpayer money unto infinity in order to keep this toxic crap propped up for the sake of the banksters’ balance sheets, to accommodate their control fraud and personal “bonus” looting? Is any of that in there? It is not.

 

How did they calculate the fiscal reverberations of the even more intensified anti-democratic stranglehold of the banks and even more obscene wealth inequality, both of these direct (and intended) effects of the Bailout? There are no class war costs factored in at all. It’s just like the idiots who parsed the health racket bailout with an electron microscope trying to find the alleged way it was marginally better than the status quo. I didn’t see any of them factoring in the monstrous costs of further entrenching the insurance and drug rackets, or the costs of forcing the people to buy worthless protection at extortionate prices, the same way any Mafia gang would enforce.

 

With those preceding questions I was still talking about quantifiable money costs. I suppose it could go without saying that the whole thing is a repulsive exercise in sociopathic wonkery and technocracy. Not a word about morality, justice, freedom. Not a word about how the worst robbers in history are getting off scot free (so far), get to keep the trillions they stole, and are being allowed to continue committing the same crimes which already destroyed the economy, stealing billions more in the exact same way. Justice has been spit upon. Morality has been raped. By their own testimony here Zandi and Blinder are committed to our permanent enslavement under the tyranny of these finance terrorists. As if, even if any of the numbers in here were true, that could be meaningful compared to the cost of our servitude in perpetuity.

 

Here’s just a few quotes on the theme, and I’ll have some more going forward:

 

“Without capital injections from the federal government, the financial system might very well have collapsed.” (p.12)

 

“The financial system is still not functioning properly…but it is stable. Evidence of normalization in the financial system is evident in the sharp narrowing of credit spreads.” (p.12)

 

So our jobless recovery takes place under the auspices of a system which “isn’t functioning properly”, but which at least is “stable” from the point of view of the criminals. Which is of course all that matters. That’s what is to be “normalized”. (I came into this piece intending to refer to how Obama was seeking to “normalize” permanent unemployment above 9%. I wasn’t surprised to see ZB using that word as well.)

 

“TARP has also been useful in mitigating systemic risks posed by the mountain of toxic assets owned by financial institutions. Because institutions are uncertain of these assets’ value and thus of their own capital adequacy, they have been less willing and able to provide credit.” (p.12)

 

“Institutions are uncertain of these assets’ value” means they’ve been uncertain how far the government will go to prop up worthless paper at exorbinant prices.

 

While the effectiveness of any individual element certainly can be debated, there is little doubt that in total, the policy response was highly effective. If policymakers had not reacted as aggressively or as quickly as they did, the financial system might still be unsettled, the economy might still be shrinking, and the costs to U.S. taxpayers would have been vastly greater.
(p.2)

 

Why? What would it have cost to achieve our liberation from financialization? ZB don’t say, but they do lay out their four allowable scenarios (and therefore the four they supposedly tested).

 

To quantify the economic impacts of the fiscal stimulus and the financial-market policies such as the TARP and the Fed’s quantitative
easing, we simulated the Moody’s Analytics’ model of the U.S. economy under four scenarios:

1. a baseline that includes all the policies actually pursued

2. a counterfactual scenario with the fiscal stimulus but without the financial policies

3. a counterfactual with the financial policies but without fiscal stimulus

4. a scenario that excludes all the policy responses.

The differences between Scenario 1 and Scenario 4 provide the answers we seek about the impacts of the panoply of anti-recession policies. Scenarios 2 and 3 enable us to decompose the overall impact into the components stemming from the fiscal stimulus and financial initiatives. All simulations begin in the first quarter of 2008 with the start of the Great Recession, and end in the fourth quarter of 2012. (p.4)

 

So it’s three corporatist policy responses plus doing nothing. Not modeled: Letting Wall Street perish while the government mustered its resources for a Main Street triage. Or they could have tried a truly Keynesian/New Deal, a direct stimulus and job creation program with no Bailout or corporatist stimulus. Those are just two examples of alternatives which ZB declare in principle to be unpolicies. That’s because they’re corporatist ideologues.

 

While all of these questions deserve careful consideration, it is clear that laissez faire was not an option; policymakers had to act. Not responding would have left both the economy and the government’s fiscal situation in far graver condition. We conclude that Ben Bernanke was probably right when he said that “We came very close in October [2008] to Depression 2.0.”

While the TARP has not been a universal success, it has been instrumental in stabilizing the financial system and ending the recession. The Capital Purchase Program gave many financial institutions a lifeline when there was no other. Without the CPP’s equity infusions, the entire system might have come to a grinding halt. TARP also helped shore up asset prices, and protected the system by backstopping Fed and Treasury efforts to keep large financial institutions functioning.(p.7)

 

It’s also fitting that they began their simulations in Q1 2008, since the ideology of the piece is that we can and should return to the status quo ante, say 2005.

 

“Broadly speaking, the government set out to accomplish two goals: to stabilize the sickly financial system and to mitigate the burgeoning recession, ultimately restarting economic growth.” (p.2)

 

Actually that’s three goals. ZB regards restarting growth as more of a magical process than a goal, no doubt. That’s the way it is with believing in something according to fundamentalist faith. But exponential growth cannot be sustained, and in fact the real economy hasn’t grown in over a decade. All so-called growth has been just the same old financial tricks. As for the two proclaimed goals, mitigating the recession is meaningless in itself, if there’s no plan for a better world to be the result; and “stabilizing” (there’s that Orwellian word again) the rackets is a positive evil.

 

ZB rewrites TARP history:

 

The Troubled Asset Relief Program (TARP) was established on October 3, 2008 in response
to the mounting financial panic. As originally conceived, the $700 billion fund was to buy “troubled assets” from struggling financial institutions in order to re-establish their financial viability. But because of the rapid unraveling of the financial system, the funds were used for direct equity infusions into these institutions instead and ultimately for a variety of other purposes.
(p.11)

 

As I recall, it wouldn’t have been sufficient to buy the toxic crap at the prices the banksters were demanding, so Plan B was accounting ”forbearance” (i.e. abetting fraud) while “injecting capital”, i.e. shoveling loot.

 

But with the banks deteriorating rapidly and asset purchases extremely complex [I like that euphemism for bankster intransigence], the TARP was quickly shifted to injecting capital directly into major financial institutions. Initially, this meant buying senior preferred stock and warrants in the nine largest American banks, a tactic subsequently extended to other banks…..

The largest use of the TARP funds has been to recapitalize the banking system via the Capital Purchase Program. At its conception, the CPP was expected to amount to $250 billion. Instead, its peak in early 2009 was actually about $205 billion, and as financial conditions have improved, many of the nation’s largest banks have repaid the funds. There is only $67 billion outstanding in the CPP. Banks also paid an appropriately high price for their TARP funds in the forms of restrictions on dividends and executive compensation, and additional regulatory oversight. These costs made banks want to repay TARP as quickly as possible. Since nearly all CPP funds are expected to be repaid eventually with interest, with additional
proceeds from warrant sales, the CPP almost certainly will earn a meaningful profit for taxpayers.
(p.11)

 

I like the touch about the “appropriately high price.” But this can’t hide how grotesqueries like BofA and Citi were allowed to pay back the TARP in order to resume bonus looting, all of it enabled by government-sanctioned accounting fraud. It’s all a propaganda exercise, just like the bogus stress tests.

 

ZB joins in, proclaiming the stress tests valid:

 

The Treasury and Federal Reserve ordered the 19 largest bank holding companies to conduct comprehensive stress tests in the spring of 2009, to determine if they had sufficient capital to withstand further adverse circumstances—and to raise more capital if necessary. Once the results were made public, the stress tests and subsequent capital raising restored confidence in the banking system.
(p.2)

 

They move on to flat out lies about the TARP and the housing market.

 

The housing bubble and bust were the proximate causes of the financial crisis, setting off a vicious
cycle of falling house prices and surging foreclosures. Policymakers appear to have broken this cycle with an array of efforts, including the Fed’s actions to bring down mortgage rates, an increase in conforming loan limits, a dramatic expansion of FHA lending, a series of tax credits for homebuyers, and the use of TARP funds to mitigate foreclosures. While the housing market remains troubled, its steepest declines are in the past…..

In fact, TARP has been a substantial success, helping to restore stability to the financial system and to end the freefall in housing and auto markets. Its ultimate cost to taxpayers will be a small fraction of the headline
$700 billion figure: A number below $100 billion seems more likely to us, with the bank bailout component probably turning a profit.(p.2)

 

Even if that turned out to be technically true, we of course can’t legitimately separate the TARP from the Bailout in general. (Or say TARP = Bailout.) But we’re very familiar with the Big Lie of doing so.

 

As for the bubble-headed dogma about permanently reflating the bubble (“This time housing prices will go up forever!”, ZB are evidently screaming), I think we know how ridiculous that is. But they’re sure trying hard. Indeed, they even bring in Phil Gramm for a cameo:

 

Three rounds of tax credits for home purchasers were also instrumental in stemming the housing crash. The credit that expired in November was particularly helpful in breaking the deflationary psychology that was gripping the market. (p.16)

 

So they ape Gramm’s “nation of whiners” having a ”mental recession”.

 

Finally, to reiterate that unemployment normalization figure: “Unemployment is still close to 10% at the end of 2010, but closer to 9% by the end of 2011.” (p.4)

 

This will have been two years since the official End of the “great recession”. Zandi and Blinder don’t venture further, but we’ve heard plenty from the administration to the effect that Obama considers this figure permanent. That’s what they’re willing to say politically. We can only imagine what the real desired number is, as the destruction of what few real jobs remain in Bailout America continues at full fury.

 

Meanwhile the hacks will do what they can to make it all look normal, and like a “recovery”. All we the peasants have to do as we free fall into impoverishment and indenture is retain faith in magic words like “recovery” and “growth”.

 

This “study” by Zandi and Blinder will try to do its part whitewashing the Bailout’s infinite crimes. And as they say, “we welcome other efforts to estimate these effects.” No doubt there will be such efforts.

 

If only an effort like the one I wrote today could get the same dissemination.

Democracy Sausage

 

“If enacted, Brown-Kaufman would have broken up the six biggest banks in America,” a senior Treasury official said. “If we’d been for it, it probably would have happened. But we weren’t, so it didn’t.”

 

I’d love for this quote to be the epitaph for this administration.

 

This open gloat that “We could have fought for the people and chose to fight against them.” It should be applied not just to the Kaufmann-Brown Break-Up-the-Banks amendment, but to everything (not an exhaustive list, but just some highlights) - single-payer instead of handing over the American people as a cash cow to the insurance gangsters, ending the war instead of escalating it, restoring civil liberties instead of further assaulting them, restoring the rule of law instead of further destroying it, breaking our captivity to oil and the oil rackets instead of tightening the bonds, ending corporate welfare instead of opening the sluice gates even wider, smashing all rackets instead of further entrenching them, eradicating the finance parasite instead of defending and further empowering it, thereby guaranteeing that the final crash and Depression will be as destructive and painful as possible.

 

“If enacted, Brown-Kaufman would have broken up the six biggest banks in America,” a senior Treasury official said. “If we’d been for it, it probably would have happened. But we weren’t, so it didn’t.”

 

That brings us to the sham finance sausage squeezing through the corporate congressional processors. Sinclair’s descriptions in The Jungle are apt but as metaphors still fall short of really capturing the evil and gutter repugnance of this magnitude of crime in action, the utter subhuman smallness of the criminals involved, the blackness of the primate heart.

 

They still keep trying to pretend. Today we learn that the conferencers really want an expanded Fed audit. But we already know that the Senate rejects this. That’s why Sanders had to pre-gut his amendment to even get a vote. (And what a vote! 96-0. It’s not just Soviet elections and Nazi plebiscites which can do that.) So this is just Frank putting on a show for the loser “progressives” in the House, so they can feel validated before they cave in and vote for a gutted audit or none at all.

 

The record is almost a clean sweep – this sausage-maker expelled all actual meat and squeezed together only the most filth-ridden fragments of snout, fatback, entrails, feces……

 

1. The critical thing is of course breaking up the Too Big To Fail banks. This was rejected completely in the form of the Kaufmann-Brown amendment. As we see with his self-written epitaph, the Obama administration is bragging about having killed it. Here Obama is eager to take personal responsibility.

 

Right there, it’s already game over. So long as the rackets exist, they will function as an extortion racket and general arsonist, raised to the level of tyranny. This is Bailout America. The 96-0 vote can stand in as a symbolic 30s style plebiscite, to give us that old European flavor.

 

2. Second most important would be derivatives reform, and here true reform would be nothing less than demolition of the casino. Only legitimate hedging by legitimate businesses should have legal status, while all mere betting should be relegated to the back alleys where it belongs. Outlaw all speculation. Simple bucket laws, and non-enforcement of sham “contracts” which are nothing but infinitely more destructive versions of sports betting, are what we need.

 

The bill does nothing remotely like this. The House version pretended, not to outlaw speculation but merely to place it on public exchanges. But even this meager measure was gutting by exempting, not just legitimate hedging, but “currency hedging”, which can pretty much be defined to include anything and everything. Which was the intent.

 

The Senate version, pushed by Blanche Lincoln under the duress of her primary campaign, is also loaded with loopholes and Trojan horses. But it does contain one strong piece - banks who want to play in the casino would have to give up their Fed window access. In other words, you can be a gambler or a welfare queen, but not both.

 

That this is the only piece in the entire mess with real bite is evidenced by the report that the banks are willing to concede the sham version of the “Volcker Rule” in order to focus their energies on defeating this gambling restriction. How can the congress possibly contemplate not letting the banksters keep playing casino games with free public money? That would strike at the core of their business model. Capitalism, right?

 

Lincoln herself, having won the primary but facing almost-certain defeat in November, looks ready to abandon her own amendment. I’d say there’s about zero chance anything better than the sham House version will be in the final bill, maybe with some of the bad parts of the Senate version added.

 

3. We already discussed the Fed audit. This looks like where they’ll play their political pretense game.

 

4. ”Resolution authority” is a fraud in principle, since we already know from the 2008 experience that in the crisis nothing will be “resolved”, everyone will be bailed out, no matter what law is in place. The PCA law already confers resolution authority and requires that it be exercised. Why would anyone think a new law would be any different.

 

(Still believing or not believing in resolution authority is a good metric for one’s ability to learn from experience. As is everything involving racket ”reform”.)

 

Both bills pretended to set up this sham authority. The House version pretended it would collect funds from the banks ahead of time to facilitate the resolutions. In this space I called it a sham “Financial Superfund”. Since the tax would be levied on banks far smaller than the TBTFs, it was even in principle another monopoly-entrenching measure, another socializing of risk and cost. And we know that in practice even if they did pre-collect such a fund and even if they did use it to take TBTFs into receivership, it wouldn’t be remotely sufficient, and the taxpayers would end up making up the massive difference. Just like with the original Superfund.

 

Meanwhile the Senate version was more honest and dropped the superfund idea, implicitly acknowledging that the taxpayers would be on the hook for the resolutions.

 

Obama, of course, prefers the Senate version.

 

And we know that in practice no collapsing TBTF will be “resolved”. To the extent it’s within the system’s power, it will always be bailed out as is. (Even the administration admits this.)

 

5. The vaunted CFPA has been a joke from the start. Obama pretended to want strong vanilla requirements, even said so in a white paper.

 

But remember:

 

“If enacted, [a real CFPA] would have [imposed real restrictions on] the six biggest banks in America,” a senior Treasury official said. “If we’d been for it, it probably would have happened. But we weren’t, so it didn’t.”

 

Obama didn’t fight for a strong, independent CFPA; by his own testimony that means he didn’t want a strong, independent CFPA.

 

Now he says that out of competing sham versions, he prefers the Senate version which includes car dealers but would be housed in the Fed, which guarantees it will do nothing at all no matter what its theoretical scope, over the House version which is loaded with more loopholes (the Senate version has many of those too) and is more overtly pre-emptive of stronger state laws, but would stand alone as a regulator, outside the Fed.

 

We already know Dodd would prefer to get rid of it completely, while Frank is presumably content with his kabuki version, playing to that House crowd again. So I expect something like the Senate version to be in the final bill.

 

6. There’s lots of other nonsense. The Franken amendment which would’ve tried to fix the absurd situation of the credit-rated hiring their own credit raters (even Dodd admits it’s ridiculous: ”just saying it alone, it screams out for a resolution”) was thrown out. None of the Senate’s aspiring Glass-Steagal type amendments even made it into the Senate version, let alone having a chance in the conference.

 

I already mentioned how Wall Street is said to have decided to let Obama have his little volcker rule, which is also laden with enough loopholes that nobody has to worry about it cramping the banks’ style in any real way. (In the Senate version, it wouldn’t even be enacted until after a period of “study”, i.e. post-legislative lobbying.)

 

 

The NYT has been peddling hype about how hard the poor lobbyists are having it. All that means at most is that having gotten 95% of what they wanted, that last 5% gets more difficult. Diminishing returns, E=mc2 and all. After all, the politicians have to pretend, and then there’s randomness such that something small might squeeze through the nets. On the whole, I’d say the lobbyists can congratulate themselves on a (mostly easy) job well done, and it’s a testament to their professionalism that they’re still fighting hard for that last 5% and whining about it to the MSM. And how compassionate of the papers to report so sensitively on that whining.

 

But nobody has to worry. If it goes through, the volcker rule isn’t going to hurt anybody. After all, it’s Obama’s baby.

 

And what do we know about Obama, where it comes to anything which could possibly constrain the rackets and empower democracy?

 

“If we’d been for it, it probably would have happened. But we weren’t, so it didn’t.”