The Truth About the Bailout

There’s so much information (not to mention “information”) about the big banks, the Bailout regime, and the financialized economy the banks and government constructed and now use as the vehicle of tyranny.
How to process it all? How to separate the good information from the bad, the useful from the pointless, the truth from the lies? How to weaponize each idea, anecdote, and piece of data?
Here’s a list of criteria which are true and, I think, useful.
1. The big banks caused the crash. They hold the overwhelming responsibility for a Tower of Babel which was bound to come down and is bound to come down again. Any other responsibilities are trivial. The proximate causes are irrelevant.
2. The Bailout artificially props up insolvent banks. But in spite of their phony profits, the banks remain collectively insolvent, and most if not all of them individually so. Every cent they gamble and loot comes directly or indirectly from the Bailouts, from free QE money, from the TBTF premium. It’s ALL taxpayer money. The big banks are now permanent wards of the state. We the people OWN them once and for all, and are free to do anything we want with them, the moment we are inclined to do so.
3. The Bailout accomplishes no socially valid end, but only enables the banks to reopen the casino.
4. The Bailout only intensifies monopoly concentration, which lay at the core of the Too Big To Fail extortion dilemma. (The policy of TBTF only helps confirm the structure in a positive feedback loop.)
4A. (Wealth and power concentration in themselves are anti-democratic, socially and economically destabilizing, and morally perverted.)
5. The finance sector is a purely rentseeking monopoly. We can place pretty much anything it does on the list of feudal tactics. Every cent they extract is a TAX upon us. All their “innovations” are con jobs, and all their lobbying is bribery and extortion. Rentier Wall Street is the driver of all federal government policy, with the corporatist government serving as a functionary, a conduit, and as a goon.
6. No true reform will be legislated thanks to corruption. We can extend this: The system is so corrupt beyond redemption that there will never be constructive major legislation again. All major bills will be Potemkin at best (like the finance “reform” bill is looking to be), or a further assault (like the health racket bill). In either case they will only seek to further entrench the rackets oppressing us.
7. Anything which is legislated will not be enforced thanks to corruption and capture. We can extend the principle: The law itself is a battleground, and the rule of law in great jeopardy.
8. We don’t need the big banks for recovery, for lending, for international competition, for anything else. All the evidence is that smaller banks provide the real value here, while big banks are not only unable and unwilling to engage in constructive action themselves, but their monopoly power actively hinders the smaller banks.
9. The size of the banks runs counter to our need for a decentralized economy with greater resiliency and robustness. The stimulus has been remarkable for how little money has headed in a constructive direction. This is because of the banks.
10. Only the rich have benefited from the Bailout. Only they will continue to benefit. Everyone else is prey.
11. The banks (and therefore the Bailout) fund the permanent war, which in turn militarizes the country for the benefit of the banks.
12. The stock market is the terrorist wing of finance monopoly. Its purpose is to punish all public interest government action (for example letting the market work in Lehman’s case, or the Congressional rejection in the first Bailout vote). Such punishment is a tool of disaster capitalism, generating the sense of immediate crisis, the Shock Treatment, to terrorize and stampede policy-makers, the media, and the public into allowing or enabling the power and loot grabs.
(On the other hand, it rewards official crime. Thus health insurance stocks have been a barometer of the policy debate on health reform, for example going up after every racket-friendly action on Obama’s part.)
Appendix: The mainstream media’s coverage is systematically biased in favor of corporatism, often atrociously so. The infrequent good articles are accidents, incidental to the media project.
The Bailout is a war upon America. This is Bailout Nation, Bailout America. (We should settle on a name for this debased regime, this perversion of America.)
The basic principles of freedom and humanity tell us that the only measures of an economy’s health, practically and morally, is how well it empowers the people of a society to produce real goods and services for themselves, and how many good jobs it empowers them to create and preserve for themselves.
No other metric has any inherent validity, and nothing else as far as money flow has any value. The rest is just a shell game.
These truths dictate the right positive principle, relocalization, and the necessary negative principle, anti-corporatism. the need to smash the banks. For we are at war.
The call – Smash the banks! Break up Too Big to Fail! Too Big to Fail is Too Big to Exist.
Of any policy we must ask first, What will it do to help Smash the Banks? Of any alleged leader or would-be leader: Where is their call to relocalize? And what have they done to help Smash the Banks? 


  1. Very impressive. When did you write this? I don’t see a date.

    Comment by Bloodgroove — April 4, 2010 @ 11:03 am

  2. Thanks. This was originally a post from last October:


    But I just recently posted this version as a fixed page.

    Comment by Russ — April 4, 2010 @ 11:26 am

  3. Ah, OK. Well, we certainly see things in like fashion. I’m a recovered former Republican. These days I lean libertarian, but more than anything I’d like to see us return to the constitution, but I’m not even sure that is the complete answer. At one time, one must presume we were largely a government that abided by the constitution, yet, here we are. In other words, somehow the constitution was not enough to stop us from reaching this point. I’m not sure what the answer is, but you’re correct in that we’re definitely going to be in for a total reset of things and government and organizations. Anyhow, I enjoy your blog. Thanks, and I’ll be sticking around for now.

    Comment by Bloodgroove — April 4, 2010 @ 11:49 am

    • Bit late on parade on this one!

      I totally agree that there’s a massive transformation going on, and it’s likely to go on for years (Yves Smith of Naked Capitalism was recently quoted saying 10 to 15 years.)

      But don’t hammer the US alone – every constitutional nation (written or unwritten) is screwing their citizens.

      All we can hope for is that, in the end, democratic pressures will awaken politicians as to what side they really need to be on.

      Or we will experience massive and wide-spread social disorder.

      But, in the end, there will be a better world for our kids and grand kids.

      Comment by Paul Handover — June 17, 2010 @ 8:35 pm

      • There can be, if we fight for it.

        But I don’t think expecting to wake up existing politicians is realistic at all. Anybody who waits for that will wait in vain.

        Comment by Russ — June 18, 2010 @ 2:54 am

      • Paul Handover: “But don’t hammer the US alone – every constitutional nation (written or unwritten) is screwing their citizens”.

        This is essential for US Americans to understand; that the US plebe is not the only population that’s being impoverished: it’s the entire global working class.

        The case of the EU is a special one, it should be noted. An article of possible interest to American readers, by a former journalist for conservative French newspaper Le Figaro, Jean-Michel Vernochet. Vernochet makes a convincing argument that Greece, hardly in worse economic condition than any other European country, has been singled out for attack by behemoth US financial institutions, because Greece is particularly vulnerable, today; an easy first target.

        The goal, he suggests, is to exploit the financial crisis to its fullest, to rock the European Monetary Union, push it into full blown chaos, ultimately forcing the EU to join political and financial forces with the US:

        Vernochet: “In reality, nothing can prevent the integration of Europe within a trans-Atlantic Bloc. In the end, the merging of the euro with the dollar will accelerate the union of the old world and the new world”.


        Full article: <a href="http://voltairenet.org/article165569.html"€uro: the worst case scenario

        So, not only is Europe facing a largely USA-triggered financial crisis, with progressive dismantlement of its hard-won social safety nets, the EU is about to be dragged down to US standards for human, and civil, rights — Shock Doctrine on steroids.


        For more information on where the trans-Atlantic ‘union’ is leading, and what it will mean for populations on both sides of the Atlantic, see: <a href="http://www.spectrezine.org/imperial-transatlantic-market"An Imperial Transatlantic Market [the most relevant passages begin with “A Transatlantic Zone of “Liberty, Security, and Justice””].

        Comment by Dana — June 18, 2010 @ 8:55 am

      • You got that right. The whole crisis and the next leg down, “austerity”, constitute a massive campaign of crime.

        I fixed your links for you.

        Comment by Russ — June 18, 2010 @ 10:48 am

      • Merci for the fixed links. And if you’d correct my typos in the future, that would be nice, too : )

        The only other thing I’d add is that the US / UK’s worst nightmare, but worst, has always been, and remains, the potential that continental Europe might cultivate and maintain independent commercial ties with Russia and China which, in terms of European economic and cultural interests, would be the most logical and beneficial thing European countries could do for themselves; singly or as a union. — Fear of such a perceived ‘egregious infidelity’ accounts for the US’s stealth integration manoeuvres towards US / European ‘partnership’, which have been actively in the works since the 1990s.

        I’m going way out on a limb, here, I realize but, what if the current global economic, multi burst-bubble shakeup were intentional? It wouldn’t be a first, by any means — one could almost call it classic strategy, the only difference being one of dimension; ie, globality, this time around.

        Clearly the geopolitical and financial gains are looking pretty exciting for some.

        Any thoughts?

        Comment by Dana — June 18, 2010 @ 12:44 pm

      • It was definitely inevitable. Cheap oil, “growth”, and exponential debt were all unsustainable.

        To what extent the robbers knew all this and planned for it, as opposed to believing their own cornucopian hype and now improvising disaster capitalist fashion, who knows. Morally it makes no difference. Their crimes have all been willful.

        That continental Europe would join Russia as a solid bloc has sometimes been of great concern to the Atlantic powers. (For centuries Britain’s whole foreign policy boiled down to opposing any aspiring continental hegemon.)

        But so far the squabblers on the continent have always ended up fighting among themselves, and now we see how the UK will once again get to sigh with relief as the EU is about to fall apart. So it’ll be fragmentation once again.

        Not that the British will get to enjoy it much being broke and cold in winter once they can no longer pay for natural gas imports.

        Comment by Russ — June 18, 2010 @ 5:28 pm

  4. Thanks, glad you like the place.

    Yes, I think we need to get back to basics. I don’t know the answer yet either, but I’m gonna try to help figure it out.

    Comment by Russ — April 4, 2010 @ 4:12 pm

  5. Wow! Impressive replies.

    But I find it so difficult to think that there are some deep hidden agendas as intimated. Governments just don’t have the competencies to manage something as Machiavellian as is suggested.

    Another way of looking at the present transformational times is that they are times whose time is right, if you get my drift.

    The ways of the world (I was born in 1944 in London – now living in AZ)have to change, that change is unstoppable. The way we have run our lives over the last 60 years has, at last, shown to be unsustainable; at any level.

    BP, the financial crisis, et al, are just the latest examples of this unsustainable way of life.

    In the end, the ‘consciousness’ of the world will climb to the point where future generations will look back and struggle to imagine how it was in the early years of the 21st century. Just as we look back at Roman times and ponder.

    Comment by Paul Handover — June 18, 2010 @ 4:09 pm

    • Does it seem to you like they’re managing things competently? 🙂

      I’d say it’s more idiotic brute force. But the larcenous intent of neoliberalism has always been clear enough. Robbery on a massive scale from a position of entrenched power doesn’t require much Machiavellian competence.

      This whole way of life sure is unsustainable. And it would be difficult for our consciousness to decay further than it already has.

      As for whether post-oil we’ll have any kind of spiritual uplifting, I’d sure love to see that consummation. Probably not in my lifetime.

      I think we could do alot worse than to regain the more enlightened aspects of antiquity.

      Comment by Russ — June 18, 2010 @ 5:20 pm

  6. BTW, the word “feudal” has entered the vocabulary with a pure pejorative significance, practically synonymous with “neanderthal” or “stone age.” This reflects a great ignorance of the age, which actually was the flowering of Christendom, and in a sense expresses what is deepest in Western man. Of course, today our bias is in favor of technology and its industrial “civilization,” as well as in favor of scientistic views of reality, stemming from the “enlightenment.” But men have not always thought thus. Neither Jesus, nor Plato, nor the Buddha, nor Shankara, etc. etc. In short the most spiritual men have not thought thus.

    Many feudal arrangement stemmed from the fact of a vast social insecurity as a result of the breakdown of the Roman Empire. Also, kingship in the sense it had prior to the renaissance, was far from the absolutist monarchies that came later and were immediately prior to the modern world.

    Comment by Jim — March 5, 2011 @ 10:46 pm

    • Jim, I agree with that. As I’ve written, I’m skeptical at best toward industrialism, technology, and the Enlightenment, and opposed to scientism.

      And I know the feudal history you mention. My descriptions here, pejorative as you say, refer to the fact that today’s kleptocracy wants to restore the most tyrannical economic and political features of feudalism. They want the worst of all worlds.

      In fact, somewhere I wrote that this neo-feudalism is far worse than the medieval variety, because it would be imposed on a population with no organic, native cohesion, no connection with the land, no practical knowledge of it, and lacking even whatever consolation medieval Christianity offered.

      It’ll just be the direct exploitation and brutalization of a helpless, confused aggregation of atoms.

      That’s what the criminals intend. So we need to work to defeat that, on every level.

      BTW, did you mean to post this comment in this thread, or in the one about corporations and feudalism?

      Comment by Russ — March 6, 2011 @ 2:33 am

      • Russ, while you’re having fun refining your working definition of feudalism (wink!), you might want to re-visit (or you might not) your statement about being “skeptical at best toward… technology”.

        Technology is merely “know-how”. Mastering a craft, art, or skill. Writing, pencils, and books are “technologies”. Banging open a pine nut using a rock is “technology”.

        Maybe the technologies you take issue with have the characteristic of not being widely accessible or “democratic”. Those, I would agree, tend toward the suspect. However, much as genetically-modified foodstuffs or atom bombs are horrid technologies, so is the universal cheap-and-easy-to-set-up waterboard (just to re-introduce our medieval theme!).

        Comment by Lidia — March 6, 2011 @ 6:27 am

      • There’s nothing “working” about my use of the term feudalism. I’ve always meant the same thing by it going back to the first post where I used it:


        By “technology” I meant modern technology which transcends being a tool, but which in dialectical turn becomes dominant over humans themselves, forcing them to conform to it as least as much as it obeys them.

        I don’t have a clear rule for when that changeover occurs, although there too fossil fuels seem to have been the critical input.

        As far as technology’s dictatorship over humanity, I’m also not certain what’s the proportion of technology’s own inertia (even many anarchists implicitly admit they’re slaves to this or that modern technology and can’t imagine life without it), and what’s the result of strategic deployment by elites.

        At any rate, the latter is politically the most important point, so that’s the one I focus on.

        Comment by Russ — March 6, 2011 @ 7:14 am

  7. I meant to post it here–re point 5. There is something profoundly subversive of Western Christianity in this continual abusive use of the term feudal to suggest the acme of tyranny and exploitation. It is almost like an unconscious conspiracy, if you will, since it is really all-pervasive. If one wants examples of utter tyranny, we don’t have to go further than the immediate present, or if you prefer, to twentieth century communism. Why isn’t Stalinist Russia held-up as one such example, or Maoist China? Because there is a powerful anti-traditional and, as I said, profoundly subversive current in the culture, which has a dissolving effect on the very roots of Western humanity. There is literally no common measure between modern tyrannies and the middle ages. Have a look at Regine Pernoud’s “Those Terrible Middle Ages,” as well as at Rene Guenon’s “The Reign of Quantity and the Signs of the Times,” and finally, at Frithjof Schuon’s “Light on the Ancient Worlds.”

    Comment by Jim — March 6, 2011 @ 3:10 am

    • I’ll be more specific. By feudal economy I refer to an economy based on sterile hoarding by an elite, based on the direct exploitation of a peasant class tied to the land. This is in contrast with the textbook/theoretical capitalist practice of dynamically putting all capital to use at all times. (But as I tried to express in my two most recent posts, the “capitalist” era was really never anything but a feudal-capitalist hybrid, and economic elites always leaned toward monopoly and looked ahead to a final state where all assets were monopolized and had once again become static. After all, in spite of capitalist propaganda about the infinitude of the earth, deep down everyone always knew the earth was finite, and someday it would no longer be possible to keep repeating the prior accumulations capitalism keeps needing. Someday the terminal accumulation would have to be carried out. With Peak Oil and the final maturation of all capitalist sectors, that’s where we are now.)

      And of course it’s in total contrast with any form of socialism or democracy.

      In the post-oil neofeudalism being planned, most workers will return literally to this land peasant status. (This will be necessary to replace fossil fuel agricultural inputs.) But in general we’ll be tied to our “job” serfdom through systematic debt indenture. The result will be the same socioeconomic and juridical status as that of the medieval serf.

      I don’t know if you read this post


      but it makes most clear what I mean by neofeudal.

      So I think it does bear comparison with the worst of our modern tyrannies. It’s the modern, corporatist totalitarian form of the old feudal structure.

      Comment by Russ — March 6, 2011 @ 4:49 am

    • Jim, what about feudalism is, to you, synonymous with “Western Christianity” in the first place? To me, it describes an economic structure, not a culture or religion. I’m not a great student of history, but to my knowledge, the Japanese, Chinese and so forth had feudal societies.

      I haven’t seen anyone on this blog defending the totalitarian regimes of Stalin or Mao. What I have seen are people trying to open up the eyes (of Americans, for the most part) to the fact that state capitalism is, also, its own kind of totalitarianism.

      If you’re concerned about reality subverting mumbo-jumbo, meanwhile, I can’t say that I’m all that sorry for your displeasure. The Church has been a horrific tool of oppression and exploitation all on its own: the excuse for the existence of another pointless parasitical class, offering the downtrodden scraps of hope in an afterlife, in order to distract them from the one currently on offer. Christian churches are profoundly authoritarian and generally pride themselves on their refusal to challenge, if not their outright support of, right-wing/corporate governments and the status quo. (I say right-wing, only because left-wing totalitarian governments did away with them as institutions.)

      Not to say that there aren’t some good religious people involved in social justice movements. This is a favorite quote of mine: “When I give food to the poor, they call me a saint. When I ask why are they poor, they call me a Communist.” -Hélder Câmara

      The Middle Ages may have a special spiritual significance for you, Jim, but I see them as marked by expansionist Crusades (which the US is currently re-enacting), the wholesale torture and murder of “heretics” and “witches”, the novel idea of exempting the clergy from taxes, the expropriation and special taxation of Jews along with edicts of total expulsion (England, Spain), etc., etc., etc. If these are the “roots of Western humanity”, then I’m re-thinking my attitude towards Round-Up.

      I’d like Russ, in his honing, to see if he can address the questions I posed earlier: can the re-localization that we must undergo occur without falling prey to violent and energy-sucking tribalism, racism and religionism? Can we create a new positive appreciation of place? of limits as positive challenges? Of spiritual work as an internalized individual process rather than an externalized group process? Can we agree that we are all of one blood, and that we are all connected to and dependent upon a single life-giving entity, which is not supernatural but completely natural: the actual earth we are standing on?

      Comment by Lidia — March 6, 2011 @ 5:12 am

      • I hope it can eventually, Lidia. But it’s true that the earth has never been free of such things. And today we have the collapsing global empire which will do all it can to stir up such conflicts to try to help prolong itself.

        I do think that the conscious philosophy and intentional practice of positive democracy is our best bet to overcome such age-old sources of conflict.

        Comment by Russ — March 6, 2011 @ 7:00 am

  8. I have missed you somehow on NC.

    Comment by diddywa — October 10, 2011 @ 11:09 pm

  9. I am curious as to your educational background and current professional endeavors. Your posts are thought provoking, and smacks of my own growing internal understandings, mostly those born of a rehab’d republican. Intuitively, from the standpoint of the tyranny that existed in th years preceding the American Revolution, we are sliding into the self made pits of oppression. To have turned our backs on the lives that fought for sovereignity over the years, only to discover we have bedded and wedded our worst enemies, of misinformation, unwittingly dispossessed ourselves with propoganda and political inaction and like a long night of drunkeness, thus, will wonder what happened in the night.

    Comment by Cy — March 7, 2012 @ 6:22 am

  10. May I simply say what a relief to discover an individual who actually understands what they are discussing on the
    net. You actually know how to bring an issue to light and make it important.
    A lot more people ought to read this and understand this side of the story.

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    Comment by right way driving school ottawa — September 27, 2013 @ 8:48 pm

  11. Thank you for the thought provoking and intelligent discussion here. Such a breath of fresh air. I feel like I’ve come home reading your blog and your reader’s responses. It reminds me when, walking one early morning years ago in Seattle prior to a conference, I found a dog-eared copy of Jung’s autobiographical Memories, Dreams, Reflections. His writings on synchronicity and the collective unconscious really resonated with me. in fact it reminded me of a conversation I had with my mother when I was about 5 years old. I had long since learned that Santa Claus was not real. One day while in church I looked around and had a thought. Afterwards I asked my mother who God was. Could I meet him. I wanted to talk to him. She said the only way I could talk to him was to pray. For some reason I thought of Santa Claus and I said “well I prayed to Santa Claus and found out he wasn’t real” so how do you know God is real? She said I had to have faith. For some reason that did not resonate well with me. If there was no proof God was real…well how different was it than Santa Claus. Of course these were the thoughts and questions of a five year old but they stuck with me for a long time and I was never able to reconcile them. Years later, when reading Jung’s book, I had a personal epiphany. It was the collective unconsciousness that I was struggling to understand. As a mature adult I believe that with enough intelligent discussion there indeed might be a way for the human race to evolve (survive) past this period we live in. I personally have tapped the collective unconscious many times. I have personal proof that it exists where I could find no proof that “God” does. I have come to believe that we are all, in some way tapping into the collective unconsciousness. I have nothing against anyone’s personal beliefs. As Alexander Pope once said “hope springs eternal”. Without hope we are lost. I hope enough people doing good will tap the collective unconscious, call it nature, call it God, call it whatever, to effect the change we need to evolve.

    Comment by John Barson — January 9, 2014 @ 10:27 am

    • You’re welcome John, and thanks for your words about the site. I know what you mean about the sense of feeling part of something bigger, and how there’s so many different ways to feel it, and no reason for there to be divides among the different ways of feeling it. I’ve never been religious, but perhaps I do have some pantheistic sensations, something similar to what they call Gaia. I think that’s in the same ballpark with Jung’s collective unconscious, though I only vaguely recall my spotty reading of Jung many years ago.

      Comment by Russ — January 9, 2014 @ 2:07 pm

  12. […] aggrandizes Wall Street’s power, excuses all its crimes (legalizing most of them), and bails it out every time it’s about to self-destruct, most despicably from 2008 onward, while this sector […]

    Pingback by The Reason: Wall Street | Volatility — October 12, 2016 @ 4:49 pm

  13. There are still some feudal societies current today. Their leaders try to export their feudal values – their comfort zone – and their people try to migrate to democracies.

    Comment by con — November 24, 2020 @ 4:52 am

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