January 11, 2011

Mortgages and Pensions, Federalism and Class War


Last week the Massachusetts Supreme Court dealt the latest legal blow to the banksters’ fraudulent foreclosure and MBS system. The Ibanez case found that the standard bank practice of vaguely claiming that a set of mortgage transfers took place (e.g. by declaring a loan to be part of a pooling and servicing agreement without establishing the entire chain of title prior to the loan’s reaching the trust) does not establish standing to foreclose. The court, like the Land Court before it, found that US Bancorp and Wells Fargo could not establish ownership of the lien and thus could not foreclose on the properties in question.
The case dealt only with standing to foreclose and did not directly impugn the legitimacy of the MBS trusts or how NY trust law, the law under which almost all securitizations are done (according to Yves Smith of Naked Capitalism), would view these inadequately documented trust assignments.
This is the latest of a string of state and federal decisions finding that wherever homeowners challenge the entities who seek to foreclose, they’re likely to find that they can’t prove they own the note and/or, in this case, the lien. It’s clear that the entire structure of debt-based land ownership is in limbo, and that no one will ever be able to figure out who has the right to foreclose upon whom. This slow but steady flow of court decisions represents the last embers of law and order which still exist anywhere on this desolated civil horizon. Florida’s Rocket Docket is the barbaric, might-makes-right alternative which the system will certainly try to impose wherever it can. In that case, the response of the Noble Savage, if he actually exists, would be to reject the land-debt system completely and take back the land in restitution as from a criminal, and in redemption as from a foreign invader. Neither of those are metaphors.
Meanwhile the banksters’ propaganda outfit, the American Securitization Forum, showed its spirit by directly falsifying the decision. In particular it claimed the ruling affirms PSA declarations as sufficient to confirm transfers, and that it said blank assignments of notes and liens were OK. In fact, the ruling explicitly rejects both of these.
It’s not surprising that the banksters are moving on to flat out public lies, directly contradicting an adverse decision. If this Feudal Conversion is really going to work, everyone involved will have to become more flexible and unembarrassed. It’s already clear that no one in government or the media expects the banks to adhere to any laws whatsoever. The last place which hasn’t been fully subject to the neoliberal version of Gleichschaltung (“coordination”, in Nazi jargon, meaning that one becomes fully instrumental for the totalitarian system) is the courts. When the ASF declares that the decision said the opposite of what it actually did say, they mean for other courts to pretend that the ASF version is the real decision. Perhaps they even expect for other jurists to read the ASF commentary on the decision instead of the decision itself. These communiques are meant to be indoctrinatory, just like the law-and-economics seminars for judges.
(And just in case that’s not sufficient, they keep repeating how Massachusetts law is allegedly “unique”, i.e. a freak to which no one else should pay any attention.)
Meanwhile, I read today of a new proposed tactic for class war. According to this plan, states facing budget crises (pretty much all of them by now) should declare bankruptcy in such a way as to break their public employee pension contracts, but not their obligations to banks and other corporations. On its face this looks like just a political threat to further scare unions who have already morally collapsed. (Well, capitalist unions are inherently corrupt, but even by those standards today’s unions are lumps of jello.) But it’s no less practicable an attack than many already underway.
(The only question I have is, aren’t pension funds the favorite suckers for all these bankster con jobs? If there’s no gullible fund managers to buy garbage like MBS, where’s the securitization racket supposed to go?
If they’re serious about liquidating the pensions, is that a sign that they’re giving up on the Bailout stage of the Feudal Conversion and committing to the Austerity stage? See below for another example of such a sign.
Or, to look at it more optimistically, is this system cannibalism an example of the limits to racketeering?)   
The federalism and constitutionalism of this looks impossible, but as in the case of mortgages, we’re no longer in the realm of law and order, but might makes right. Again we see how the only obstacle would be the extent to which the courts retain any integrity. 
Would federal courts accept a case in the first place which is so clearly outside their jurisdiction? States are sovereign in their finances, and the federal government has no authority to put them into bankruptcy. Maybe Gingrich means they should submit to binding arbitration as a privatized bankruptcy tribunal, sort of like a globalization cadre under the shadow of which a government alienates its sovereignty and submits to a “structural adjustment”. That’s exactly what’s suggested here for the states, right? As I wrote before in the context of food policy, the anti-sovereign globalization bureaucracy is the prototype for total corporate rule.
But if the corporatist SCOTUS took such a case at all, there’s little doubt they’d find it acceptable. This institution, at least, becomes better coordinated every year.
[Digression: In that post I just linked, I mentioned how, among a commentator’s metrics for how pro-corporate a court is, the only one where the Roberts court hadn’t been far more aggressive than the Rehnquist court was in the realm of employment discrimination. But that may change with the looming Walmart case. I argued that if the court steps up its assaults on discrimination protections, that could be a sign that “neoliberalism” is getting ready to dump its corporate liberals as no longer useful.
Another recent sighting is Scalia’s interview where he declared that as a constitutional matter he thinks the 14th amendment was never meant to apply to anyone but ex-slaves; in particular, that it doesn’t apply to gender-based discrimination. He still disclaims any intent to rip up the superprecedent, but it’s still interesting that he brings this up just when the SCOTUS is looking to more intensively scrutinize the whole concept of anti-discrimination as a constitutional principle.
As an aside within my digression, an aside which refers back to the main post, I bet the very fact that Scalia feels the need to claim this bogus “originalist” ideology (which he doesn’t even adhere to) is seen by real corporatists as evidence that he’s not fully reliable. Sure enough, his record, while pro-corporate and pro-statist on the whole, is inferior to that of Roberts and Alito, who represent the truly coordinated model. They’re pragmatic, they’re flexible, they’re instrumental, they’re absolutely cold and ruthless, and therefore feel no need to square things with themselves through the device of a constitutional ideology. As Hannah Arendt describes in Origins of Totalitarianism, true-believer ideologues are considered philistines and buffoons by the true totalitarians, and some point in the movement’s history those ideologues are dumped.
Read here for an example of Alito goofing on Scalia. “What did Madison think of video games?”]
One thing’s for sure. As these examples demonstrate, these criminals despise laws and contracts except as burglary tools, robbery implements, weapons of assault. If anyone wonders, “how can they whine so much about the sanctity of contracts but then turn around and try to break all their own contracts?”, there’s your answer. They believe the non-rich are sub-human, not citizens. Therefore it’s impossible to have valid contracts with them. If a government or a corporation signed a contract incurring a pension obligation, by definition that “contract” was extorted by thugs. It has no more validity than if extorted literally at gunpoint.
That’s really what they believe. I don’t know if they’ve gone so far as to formally elaborate this ideology. As I mentioned above, they’re reaching the point of disdaining formalized ideology. But that is their ideology.
So they think comparing an obligation to a bank with an obligation to workers or citizens is comparing apples and oranges. The former is a valid contract, the latter is not. Simple. (Needless to say, any contract between power and subhumans is valid where the benefit runs upward.)
That’s the essence of class war.
Until we fully understand and fully reciprocate this ideology, for example where it comes to recognizing which agreements are real and which are odious frauds upon us, and acting upon that recognition, we’ll continue to lose.
We must simply turn things right side up.   


  1. Thanks for this post, as everything you’ve written is true, especially that the elites believe the non-rich are sub-human, and not citizens. The Russian billionaire Mikhail Khodorkovsky (now imprisoned) once summed up this attitude when he said: “there is something wrong with any man who is not an oligarch”, and I’m convinced the majority of American elites would agree his contempt for the non-rich, just that they don’t say this kind of thing in public.

    I’ll check back here whenever I have the time and read some of your other posts. Thanks for all you’re doing and please keep up the good work!

    Comment by Tim — January 11, 2011 @ 9:47 pm

    • Thanks, Tim. The rich aren’t like normal people, and it’s not just because they have more money.

      Comment by Russ — January 12, 2011 @ 12:10 am

  2. Russ, your body of work is stupendous. And your theme phrases are pithy and monumental. I encourage you to create a ‘daily reflection’ type book, self-published, of course giving our co-lovers a meditation a day at a time. Peace, Love & Understanding, tawal

    Comment by tawal — January 12, 2011 @ 1:42 am

    • Thanks, tawal. There’s a good idea – distill all the affirmative ideas and bugle calls.

      Comment by Russ — January 12, 2011 @ 2:38 am

  3. Just the right time to get it ready for 2012. (Although I’m partial to 2011; what do the psychologists say about prime number freaks?)

    Comment by tawal — January 12, 2011 @ 2:54 am

    • I don’t know about prime number freaks, but 2011 vs. 1 looks like a good arithmetical metaphor for what’s the true balance of power, if we the people only chose to use it. All other factoring is false.

      Comment by Russ — January 12, 2011 @ 5:26 am

  4. Hi Russ. I find your visions of neofeudalism to be both highly disturbing as well as compelling. This morning I experienced a wave of dysphoria as I thought about the forces arrayed against us as free humans. I often feel off-kilter thinking about these issues- although I am convinced that the decay and corruption you describe are real and deadly, I often feel hopelessly alone in that assessment. The ability of my family in particular, mostly descendants of miners and steelworkers who for generations lived in indentured servitude in company housing, to deny that such a condition could ever be inflicted again (on themselves or others) boggles my mind. I was raised on grand tales of union leaders and strikes finally breaking the deathgrip of foreign capitalists on those working people, but they now seem to be just stories, long-dead memories whose spirit has finally been snuffed out by the creature comforts our society can provide.

    I recently read Chris Hedges’ “Death of the Liberal Class”, which concludes with the notion that any movement to bring actual justice and freedom to the people must begin with the faith that steps taken in that direction have intrinsic value, irrespective of the probability of eventual progress or success. Hedges describes anarchist Catholics who have drawn on their religious faith to continue providing for the poor despite the withdrawal of the rest of the church, and liberals at large, from the provision of even the most basic dignity and sustenance to the very poor.

    Maintaining this faith, I suppose, will be the only way to keep going through the trials ahead. You have written of your overall optimism grounded in the belief that the neoliberal predator state is inherently unsustainable, but your descriptions of the neofeudal order seem to provide a clear roadmap by which a small elite might continue to live in luxury while the rest are condemned to serfdom. Perversely, the neofeudal order you describe in the linked post on food tyranny might even be more environmentally sustainable than the current one.

    In this light, then, it seems that a faith in the inherent value of our plans and actions is the only way to keep moving forward. For myself, I am deeply skeptical of my ability to act in a way that actually does advance the goals of true democracy and federalism. For every idea I have that seems realistic enough to implement, I can think of a thousand ways it might end up serving the interests of the existing order. I constantly detect the corrupt values of the society I am embedded within in my thoughts and plans.

    I am currently reading, for the first time, Saul Alinsky’s “Rules for Radicals”, and am thinking about the ways and extent to which we must accomodate the existing order while building an alternative. I would be very interested to hear any thoughts you might have on that work.

    Comment by paper mac — January 12, 2011 @ 4:36 pm

    • That’s a lot of food for thought, paper mac. There’s definitely nothing we can do without the faith that somehow we can improve things for our communities and perhaps even contribute toward transformation on a far grander scale.

      Fortunately, “faith” isn’t technically the right word, since history has already proven many times that things like this can be achieved. But each time, the doers and fighters must have the faith.

      The possibility that one’s efforts will be co-opted or hijacked is a hazard of the times. I don’t know what your specific examples are, but the best we can do is always live according to our principles. If any contemplated action would violate a core principle, it’s almost certainly not worth it, no matter what short run benefit it might seem to have.

      This piece includes an example of how Growing Power, after some deliberation, rejected Monsanto money which would have allegedly been no-strings-attached, and they wouldn’t even have had to display a logo:


      They decided the affront to principle, that they and everyone else would know they’d taken such tainted money, and that of course Monsanto would cite them in its own greenwashing propaganda, would outweigh whatever good they could use it for.

      So maybe that example can help induce a template for some kinds of dilemmas.

      All of this is part of building the alternative within the existing (dis)order. That’s a key part of Alinsky’s philosophy, as I recall (I haven’t read the book in some time, although it’s on my schedule for a reread; when I do, we can discuss it in detail), that tactical flexibility. I don’t recall that he was ever an anarchist, but if he emphasized building the new wherever possible within the decrepit and malign, that’s the core anarchist philosophy as well.

      To succeed is not just to achieve some full-scale revolution at some point in the future. It’s also achieved right here, every day, to whatever extent we live and work and build toward that goal, and in line with those principles.

      So the faith is supposed to confirm itself through the production of works. These works will usually be incremental, gradual, but the main point is to live as human beings even in the face of such adverse forces. This in itself is an ongoing triumph. It proves the principle and fosters the faith to continue. We’ll all have moments of doubt and even despair, but that’s when we most need to know that those are just moods which do not reflect deterministic reality.

      When I feel down, I remind myself that it’s a proven fact that what I’m trying to do can succeed, and that the only requirement is that I keep plugging away at it. And I remind myself that my mood is just a passing mood, and if I don’t surrender to it, tomorrow I’ll feel revived and optimistic again.

      So that’s how I personally look at it, and that’s the context of ideas and faith in which I locate myself.

      Comment by Russ — January 13, 2011 @ 3:29 am

      • Thanks for the comments, Russ. I’m increasingly convinced that any democratic food production setups will need to compete, at least marginally, with big ag, particularly if they are to accumulate enough resources to thoroughly close their loops before the worst of the post-peak period sets in. This will require capital, and guerilla business strategies at least as ruthless as those employed by big ag against the consumer co-ops which have been so successfully marginalized. This seems fraught with opportunities to go off the rails and become just another racket. I suppose in light of your comments, I should start thinking more carefully of what the core principles of such an operation ought to be in order to provide clear boundaries of conduct and ethics.

        Comment by paper mac — January 13, 2011 @ 8:39 pm

      • There’s lots of dilemmas to work out. In a perfect world we’d be fully altruistic among ourselves, open toward newcomers, and absolutely ruthless toward anyone identified as the enemy. Obviously, it’s difficult to harmonize such differing perspectives into a coherent mindset.

        But one thing which can help is to develop a coherent ideology and set of principles, identifying what’s negotiable and what’s not, and turning that into a kind of oath of civic faith. Of course something like that can’t just be imposed as a template (although progressives often seem to think it can be; thus their typical demands for instant gratification from any alternative political action, otherwise it’s not worth doing); it has to organically evolve.

        But one of my goals for 2011 is to develop a basic framework on this blog. I figure I’ll do it through the device of a mock constitutional convention. I’ll envision myself as a bunch of “delegates”, and any commenter can be a delegate or set of delegates as well. I’ll propose:

        1. Basic humanistic principles to guide us.

        2. Ideas on constitutionalism and federalism intrinsically.

        3. How this form of government has failed and how aspects of this written Constitution have therefore proven inadequate as mediations of the sovereign constitution.

        4. What Amendments we therefore need.

        All of that can be an exercise. And the basic process is scalable. The moral principles must apply at every level of endeavor, and assuming one agrees with the basic democratic and federalist imperative, the constitutional principles for a “national” document would be the same as those for a community organization.

        I’ll flesh all this out further. But there’s a basic sketch for something we can do to work on this.

        Comment by Russ — January 14, 2011 @ 5:10 am

  5. Greed is a mental illness, like the insatiable appetite for any substance.

    I don’t care how many toys when you die, you should only be able to give 5,000,000.00 [inflation adjusted 2005 dollars] to any individual. any individual may not receive more than 5,000,000.00 [inflation adjusted 2005 dollars]from any group of people.

    In the same way we prevent drug abuse we should prevent dollar abuse.

    Comment by S Brennan — January 13, 2011 @ 12:53 am

    • It’s a socially conditioned mental illness. It’s a lie that greed represents “human nature”. Most communities throughout history and prehistory didn’t know this kind of greed. The attitudes of the commons and the gift economy have been far more common, which is evidence that they’re actually closer to the “real” human nature, to whatever extent there is such a thing.

      How did you settle on $5 million?

      Comment by Russ — January 13, 2011 @ 3:36 am

  6. Sign these petitions get others to sign
    “A Declaration of Rescission of All Foreclosures & Mortgage Transactions to Restore 2001 Title Conditions of All Real Property”

    “A Declaration by the People to Abolish the State and Federal Constitutions, Governments and Laws made in pursuance thereof.”

    Comment by DyingTruth — January 13, 2011 @ 1:01 pm

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