Another day, another clueless editorial of Paul Krugman about the socio-economic crisis. Krugman, in his embarrassing naivety, opposes, as all too many do, austerity versus [the attitude that it’s] “no time to worry about budget deficits and cut spending, which would only deepen the depression”. Sorry, reality is otherwise subtle.
[Funny Krugman calls it a depression now. I called it a Greater Depression, all along, precisely because the causes are so deep, and so deliberately misunderstood, I expected the depression to last indefinitely.]
I sent a comment. It was delayed from publication for nine hours, by the censors at the New York Times, and that made sure few people saw it (3 readers approved it). “Preferred commenters” of the New York Time such as Karen Garcia, were published right away (and approved by a thousand people). It’s not that Karen Garcia is wrong (she parrots some of the consequences that I have evoked for years).
The problem with Karen Garcia and other commenters and editorialists the NYT advertises, is that they describe epiphenomena as if they were fundamental, while not even guessing what the fundamental problems are.
Because I understand the fundamental causes, the NYT tries to make sure I am not read. A good way to insure the deepest debates are avoided, is to drown us with thousands of comments always from the same commenters, always late on the critical curve.
Here is one of the perpetually “featured commenter” of the NYT: “Karen Garcia is a trusted commenter New Paltz, NY
It’s not that economics failed. It’s that the cult of Mammon succeeded. The rich control all of us via such legalized bribery scams as Citizens United. The rich ensure that the austerity dogma is broadcast by their six media conglomerates, and that only two sides of one big business party are allowed to exist. Wherever they detect an opportunity vacuum, wherever they smell another distressed pocket of humanity, they pounce. A study by some Northwestern University researchers reveals that while the wealthy (they like to call themselves “thought leaders”) intellectually accept Keynesian economics, they’re de facto Scrooges.
Some findings: –Only 16% of millionaires think climate change is “very important.”
– While two-thirds of Americans favor single payer health care, less than a third of the wealthy do.
– The rich favor more government spending in only three areas: science, infrastructure, and education. Investment opportunities abound for charter schools, privatized toll roads, university research programs – all funded on the public dime for private profit.
– Only 19% of the wealthy believe the government should create jobs for the unemployed (as opposed to 68% of the general public). Less than half favor raising the minimum wage. Less than half think it is the government’s job to see that nobody goes without food, clothing and shelter. It’s not that economics failed. It’s that we’re living in a nightmare reality show called “Plutocrats Gone Wild.”
Karen Garcia is a trusted commenter New Paltz, NY:
Here’s the link to the Northwestern study cited above: http://faculty.wcas.northwestern.edu/~jnd260/cab/CAB2012%20-%20Page1.pdf
One of its authors, Benjamin Page, also collaborated with Martin Gilens of Princeton on the just-released preview of a forthcoming report which concludes the USA is well on its way to becoming an oligarchy. That paper is here: http://princeton.edu/~mgilens/Gilens%20homepage%20materials/Gilens%2.“
On one hand, I am proud to be a commenter NOT trusted by the plutocratic owners of the New York Times. On the other, that means that my deeper critiques go unnoticed.
The “Garcias” the NYT submits us to, look very “lefty”. And I approve Garcia’s message above. But, just as with Krugman, that talk does not have much teeth (being very late on my curves).
Indeed: how did the cult of Mammon arise? That “Garcia”, in her zillions of “featured comments” has never said, and never will, not any more than Krugman (except, of course, when, and only when, everybody knows about it: Garcia and Krugman use the concept of “plutocrats” now. but did not, for years).
The rise of Mammon has to do with the, leverage, government guaranteed, unsupervised Public-Private Fractional Reserve System, and the Public-Private Central Bank. Instituting a world wide hedging casino also helped. All together allowed financiers to get immensely rich, and, thus, powerful.
That Krugman will not tell you, and nor will “Garcia”. Quite the opposite. Too technical. Krugman insisted for years that the futures’ market had no effect on the real economy. Clueless max (I sent him plenty of comments to enlighten him, but I am still waiting for results!)
Krugman asked a number of rhetorical questions in “Why Did Economics Fail?”. He made clear that it is not “economics” that failed. I answered them:
Krugman: Why inadequate demand?
Because there was not enough money for the real economy (a good way to get there is by cutting the incomes a normal people). Why not enough money? Because banks create money, through credit.
Banks extended that money to financial co-conspirators, the hedge fund managers and other financial and future commodity traders, quite a few of them in house. One could not do this in the past as these activities, using all the money in the world to run a casino, did not exist in the past.
That basic problem has not been fixed. It requires re-instating a modernized version of the Banking Act of 1933. The casino-that-uses-all-the-money-in-the-world ought to be dismantled, too.
Krugman: “this was no time to worry about budget deficits and cut spending, which would only deepen the depression.”
Yes, I have called it the Greater Depression, and so it is in term of unemployment and GDP, as, in many countries, the numbers are worse than in the 1930s.
When budget deficits are caused by hedge fund managers paying less taxes than janitors, or because corrupt bankers funneled money to co-conspirators to build airports, or towns in the middle of nowhere, and the banks have to be rescued, we should worry about deficits.
When spending has to do with crony capitalism, we should worry about deficits.
Krugman: “why didn’t we use the economic knowledge we had?”
Because the plutocrats are not after repairing the economy. They are after their own profits first, destroying democracy second. To get to the latter, the more high unemployment and poverty, the better. Whether the plutocrats in command are aware of this desire of them, is irrelevant. They have it, deep inside.
Naturally, the hyper wealthy tend to reward economists that support their views, and since the wealthier the university, the higher the salaries and the more they are connected to plutocracy central, the desire of the Plutos became the teaching of the most respected economists, the mainstream economic thought.
REFRESHING OURSELVES WITH THE ROMAN PERSPECTIVE:
In imperial Rome, and Constantinople, plutocrats feared revolution, and the return of the Republic.
(That fear extended all the way to 17C England and France; Anne of Austria, reigning queen of France, mother of Louis XIV, faced by the Parliament’s deputies told them it was “evil to prefer the government of a republic to that of a monarchy. We are not in a republic.”) .
To prevent the return of the Respublica, Roman plutocrats made sure that most people were unemployed in Italy in general, and especially in the world’s largest city, Rome. Unemployed people are powerless (idleness can’t strike), and unemployed people dependent upon the “philanthropy” of the richest (a phenomenon in plain evidence in the USA, where filthy plutocratic tax free plotting conspirators have to be called “philanthropists”, especially when they capture the educational, social, or health care systems).
We The People have been trained to behave like pigeons feeding in the hands of some of the basest individuals in the universe (that’s typically how they got to be so rich: look at the dynastic, government leech Carlos Slim in Mexico, second richest man in the world, if you don’t want to look at the hyper well connected Gates, ever since he was in the womb).
There is every reason to believe that the same phenomenon as in Rome and Constantinople is at work now. Actually, in the ideal plutocrats’ world, this debasement of man by wealth is the only thing that should work.
To underestimate the Dark Side, and to exclude it from economic theory, is missing out half of the motivational universe of the genus Homo. But it goes well with underestimating the venality of economists. And then economists can turn around and pretend to predict what’s good and bad for entire nations.
All what this achieves is the rise of plutocrats determined to outdo themselves and their “partners” (a word the Mafiosi around the Kremlin love to use). Hence the rise of the Kochs and Putins. Hence the decay of the biosphere.
The decay of the biosphere is used as a decoy, a sacrificial pawn, that attract attention. It’s made into a debate where the population is invited to lose all sense of reason and evidence.
How does that work? Take an example: the snowpack in the high mountains of California is 18% of normal (April 2014); California’s reservoirs are half full (instead of 100%). It’s obviously a crisis. But then plutocrats roll out their well-paid deniers (Putin does the same, even inside the USA!), and they flood the media with their insults to reason and evidence.
That creates a secondary crisis, more general than the first one, as now people are invited to deny reason and evidence.
While We The People waste energy debating individuals of extreme bad faith, the real problems such as why is it that Putin has 40 billion in Switzerland alone, and why is it that all the media and political systems are controlled by so few? (See the references of “Garcia” above, or mine in earlier essays). How can that be compatible with democracy?
And how come the rich is not taxed enough to prevent the chain reaction of the plutocratic phenomenon? Well, because we have been obsessing about trivialities, or red-herrings.
In other words, false debates hide the real ones. And control is achieved that way. Thus Krugman’s droning propaganda at giving ever more money to precisely the banks and individuals who created the Greater Depression of 2008, and calling that the antidote to austerity. (Of course he does not put it that way.)
Censorship and media manipulation are more subtle in the USA, than in Erdogan’s and Putin’s Great Reichs. Thus, they are not seen by most. And are even more efficient.