Greece is an old country.

Both have been in the News a lot lately for varied reasons…

Apple for it’s phenomenal founding leader’s death and genius, and Greece for it’s phenomenal economic destruction [death] and its stupidest leadership on record.

And although Greece has a proud and long history, it has taken a barbaric rape and pillage type battering in the financial storms circling the world. Yet still, her image is vibrant as the place to train for throwing cocktail molotovs [young protesters] the longest and for throwing the old and infirm pensioners under the rails of the tram [government ministers] the longest. Further indignation was heaped upon the country when the European Commission claimed that Greece’s loss of sovereignty is a permanent state of affairs.

On the other hand Apple’s gain of personhood in the US makes it a great candidate for President if corporations can be elected to that highest of offices now that they are seen as persons in the eyes of the law…

So what is a young man to do?

Stay in Greece or go work for Apple?

Because the stock of the young [relatively] technology company Apple rose sufficiently to make it more valuable than the country of Greece.

The Apple stock rose sufficiently this month, to value the company at more than $400 billion. That already makes it the world’s most valuable tech company but it also makes it more valuable than several nations.

Apple’s market capitalization is higher than the gross domestic product of countries such as Greece, Austria, Argentina and South Africa. The $400 Billion valuation places Apple in 2nd place as the most valuable companies in the world, behind only Exxon Mobil, which is valued at around $420 billion.  Apple’s valuation is more than double the value of fellow technology heavyweight bluechip companies Microsoft and Google, both of which have strong smartphone divisions and communication arms but not the creative genius behind I-tunes etc.

What’s more, despite the size of the company, it still remains one of the fastest growing tech companies in the world, because we saw last quarter sales to have risen by 45% year on year when they were announced this week.

Instead Greece slides further down and it’s value gets deflated, in the uncertainty of PSI [not the tire pressure] negotiated outcomes with the debtors and the European guarantors clamoring for creating a slave nation…

Yours,

Pano

PS:

Go west young man…

Go and go fast.

It means you won’t be afraid to live.

It means you are not afraid to be.

Or maybe it means you are more afraid to leave…

Yet if it were as simple as doing nothing it would be easy.

Because this is not about being fearless or living on the edge, nor is it about being reckless or an adrenaline junkie. This is not about being daring. It’s about just being there. To simply be. To be left alone to simply have a Life, a family and a job. To be allowed to just be a human being. Being there, where you were born and simply carrying on… the toil of the earth you’ve found your lot into.

It’s about labouring under the same sky and in the same patch of land your forebears toiled too.

But then, sometimes it’s not.

Sometimes you find yourself in those moments that rip your chest open. That was when Hrant Dink was assassinated in broad daylight walking to his journalist office in Isticlal Cadessi. In the midst of the  busiest street of Istanbul, at the most busy time of the day, an assassin’s bullet cut off his golden thread. Only because he was a Turkish Armenian. A hate crime of great magnitude…

I remember writing back then about my friend’s death and feeling sorry for myself too. “It’s so sad that it takes everything you’ve got; not to wrap your arms around yourself to feel protected. It’s time to go… because you are at the edge of a cliff looking down at where you know you want to be, and the knot in your stomach keeps you from making that leap and getting there to be on the safe ground.”

I left Istanbul the very next day as did so many others like Orhan Pamuk, and all the writers, all the ones who were on the list of the writers accused of  ”Insulting Turkishness” either because they spoke of the genocides or because they wrote about them…

All of the ones on the list left. And afterwards we would meet frequently in Paris for a while. Paris where many of the recent emigres shared and swapped horror stories and laughed with strong milk white coffee and black gallows humour. That’s all you can do. You wrap yourself up in thoughts of your family and friends, and thoughts of every day and do what comes natural to human beings. You forget… Pretend it’s not there. Protect yourself from the bumps and bruises you’re sure you’ll get. But the protection is an illusion. Staying safe–that’s what hurts the most. So you go on living and hoping that some day you’ll forget entirely.

But the new French Law about the Armenian genocide denial has brought all of it back and it’s not to be forgotten. It’s a bold move to protect the memories of old and new genocides…

How can you prevent new genocides if you forget the Armenians? How can you forget Rwanda? Can you forget  Nazi Germany and the Holocaust? What about Stalin’s ethnic cleansings? What of Armenia, Greek Asia Minor, Kampuchia, Bosnia Herzegovina, Darfur, South Sudan and so many other lesser known genocides?

Would all of these genocides have to have happened? Could we have escaped maybe one of them if we had properly remembered the Armenian people’s genocide in Turkey back in early 20th century and had punished justly and severely the perpetrators? Could there have been one or more human lives saved? If that answer is yes, then let France shows us the way of Democracy Truth and Justice, and teach us to rightfully declare a spade a spade. A genocide is genocide – no two ways about it.

We must not forget lest we repeat this pattern of annihilation of humans because of their differences. Lest we forget the annihilation of hope… Lest we forget that we are better than this. Lest we forget that we are civilized and not blood crazed savages…

For to forget is to forgive… And we ain’t ready for that yet — as a species. We are not mature enough to forgive and still not forget… Or are we?

Now the story of the Armenian genocide can get told freely by modern chroniclers who go on, like this American perspective from the ambassador of the US in Istanbul at the time of the Armenian genocide: Back in 1916, Henry Morgenthau, American ambassador to the Ottoman Empire, resigned. His State Department superiors’ demand that he maintain cordial relations with Turkish nationalists and their brethren, Islamist zealots and ethnic purists of Turkey’s leadership, as they went on and massacred the whole of the Turkish Armenian Christian minority disgusted him.

Morgenthau went on to say: “I found intolerable my further daily association with men who were still reeking with the blood of more than a million innocent human beings slaughtered in cold blood.”

History will tell you that the Turkish nationalists, perpetrators of the first genocide of the 20th century, got away with it, as they almost invariably do. None of them hanged by the neck. Not one went to prison. Instead they were celebrated and are still considered heroes of the Turkish nation… Even later when Turkey found itself with the axis of evil on the losing side of the First World War, the victorious allied armies never held war-crimes trials against the Genocidaires in Turkey. They apparently had bigger fish to fry… And more pressing matters soon took over the attention of the world and the whole sordid mess was forgotten soonest. But their pattern of genocide persisted and the German officers who were close allies of Turkey at the time of the Armenian genocide and in some ways assisted the extermination of the Armenians, they used the lessons learned of how to exterminate human beings at large scale and large numbers efficiently and applied their evil science to the new “others.”  To the gypsies, the homosexuals, the Jews and all other unwanted minorities, they applied the newly learned and unpunished doctrine of genocide  with horrific efficiency and no fear of retribution…

For Turkey, and the fragile world of the intermission between the two world wars, it was convenient to forget the Armenians and to rewrite history. Especially since nothing was heard from the Armenians. Not a peep was heard from the Europeans or the Americans and the Russians either… And in Turkey it was state science to vilify Armenians, Kurds, and Greeks and all the “others” as Unturks. Because the Armenian people who survived in Turkey stayed mouse quiet… They pretended to be deaf mutes. Believing that staying quiet they would be safe in their room with the door shut, and that was easy. But it never is. Then again, because they didn’t seek justice, they missed the boat on that one. And since they didn’t seek redress they also missed out on that land.

Because as we all know, you have to open your door and scream at the top of your lungs. Because if you don’t open that door you miss everything. You miss who you are. You miss who you are meant to be. You miss your purpose. You miss love. You miss Life.

Something Hrant Dink never did… cause he stayed screaming till the end and spoke against genocide and was tried in court three times for the Thought crime of “Unturkishness” because he mentioned and wrote about the Armenian genocide – as a historical fact – something that the modern Turkish state refuses to believe and punishes those who have the temerity to remember it.

Hrant Dink was a fighter for justice and truth. He was a fighter for the People’s future and ultimately he was a fighter for a better Turkey. He was a just warrior of the heart. He loved his country and never wanted to leave even after all that had happened to him and his people. He hoped for a better Turkey. But history proved him that although his aims were noble, himself was ultimately very brave and very brazen…

But the warrior isn’t brave on his own strength. It’s because of the people he protects that he is fearless. It’s because of our sad, tender broken-open hearts that the rest of us can be brave.  And it’s about Love of principles and humanity. It’s about “amour” and not about armor. It’s about being naked of fear, and it’s not about keeping your shield at the ready to protect yourself or others you love. It’s the opposite; it’s stripping off your armor and laying down your shield in Love with Life and it’s true drama. Because genocide is just part of the human drama we are all engulfed into sometime…

It’s getting to the cliff’s edge and diving off — for this is the edge of humanity.

Yours,

Pano

PS:

It’s all about refusing to give up and refusing to stay hidden in bed — even though that feels safer —  but going out boldly to face your fears and live as a person, be it Armenian, Turk, French or Greek.

Do this and scream for justice every chance you get.

Otherwise we will relive these genocides like Hitler’s Nazis did, when he famously urged them on the kill of the Jews and some of his officers objected on the grounds of History…

Adolf exclaimed : “Who now remembers the Armenians ?”

Things are so bad in Greece that soup kitchens are to be found in all central Athens communities. Desperately disillusioned  parents and hungry people give up their kids as they drop them off to schools never coming back to claim them. And now in Athens there has been an explosion of poor peoples’ diseases with Tuberculosis in the centre of the city spreading as fast as rumour does.

Tuberculosis once a prominent feature of the Victorian coal burning and mining era —  the famous black lung death — had been pretty much extinguished in Europe with all children vaccination and the advent of radiology, skin testing and good pulmonary screening and antibiotic therapy, throughout the continent. But Athens now seems to be like Mogadishu and TB is getting epidemic proportions fast…

Because now we see young children and adults suffering from this debilitating disease that has a 50/50 chance of killing you, when it gets to the lungs and becomes pulmonary tuberculosis.

Because of the urgency of the situation, we’ve started a Tuberculosis containment campaign for Athens and Greece’s children, and need your help because the Greek nation cannot cope any longer. And it’s not only the lack of money but also the stupidity of the docile Greek State and the current Minister of Public Health who refuses to release the proper statistics and the real data about the spread of the tuberculosis in Athens because he is afraid that this will be seen as a singular failure on himself and might diminish his chances to succeed the stupid ex-PM Papandreou into the leadership of his corrupt party and maybe the country. What a dreadful bastard…

Politicians willing to sacrifice their people and their children for political gain is a high treasonous crime.

But there you have it…

I just came from Athens and saw with my own eyes the mess these criminals have wrought on the country. They live on the hog while their people go hungry…

Thieving politicians and thieving European and German bankers have been causing the downfall of this country to the lowest point since 1941 when it was occupied by the German army and their Nazis who stole all of the wheat harvest and all other food and left a country poor and destitute, because they had dared to oppose them and vanquish their Nazi ally fascist Italy. After the Wehrmacht stole the harvest of Greece, naturally a great famine ensued that killed more than a million Greek citizens ultimately throughout their long occupation. More than fifteen percent of the population was exterminated thus and that was the highest toll that any country paid in the second world war. And now it seems like Deja Vu with the Germans again inside the Greek Ministries telling people what to do…

And now the new wave of poor health and non existent care, amid semi famine conditions for the unemployed of Athens and malnutrition for their young children, has resulted in an upswing of Tuberculosis and other economic diseases. It’s a dire reminder of economic infanticide.

Because yesterday, when I left Athens was informed that a seven year old kid had died from TB and the Doctors “doctored” and downgraded the death certificate to a Flu death in order to avoid the strict guidelines and the onerous paperwork and not wanting to report TB that the Greek Ministry of Health, denies to accept as existent in Athens. What a shame…

Because of all that we started a new charity called Greek Tuberculosis Campaign for Children to examine and treat all the at risk populations of Athens with mobile free clinics and we invite volunteers and your help in are raising money here:  http://www.indiegogo.com/Greek-Tuberculosis-Campaign-for-Children?a=322198

And if you want further proof of what’s going on in Athens, here it goes…

As a lament comes the voice of a Greek Teacher who just now chose to resign her state job and to come work with us in helping fight the rise of Tuberculosis amongst the children.

A Greek teacher named Maria, today submitted her resignation to the government of Greece….

Here is the text of her resignation letter:

” I have the honour to submit my resignation from my position as a Teacher in the 8th Primary School of Pireas – Greece.

 The reasons that made me choose the resignation route are the following: 

- Because as a teacher I always thought that my attitude is an example and what I feel and teach passes like a breath of fresh air in the souls of the children. 

- Because in my teaching I offer no empty words and no nonsense. 

- Because I offer emotions, actions, and correct attitude. 

- Because I cannot face the eyes of my children begging any longer.

- Because am ashamed to serve an educational system that does not exist. 

- Because I have no rights and am I am not allowed to teach what is right. 

- Because I refuse to participate in the lies of your fake system by repeating the telling of lies you spout, like: “First, the student,” “Free public education,” “Equal opportunities for all” ???

- Because I refuse to waste the taxes of my fellow citizens and refuse to offer them obediently to the traitors of my country without being able to deny or resist their traitorous decisions.

- Because I refuse to endorse, to collaborate and to facilitate those who bleed my country to death.

- Because they are brutal murderers who kill every day someone of my fellow citizens.

- Because among their many victims are many children and even my husband. 

- Because I do not want to cooperate with those who stole the sweat of the Greek pensioners without shame and respect for their lives. 
- Because I do not want to cooperate with those who filled the country with homeless and are now supposedly merciful and repentant.

- Because I do not want charity, and I do not recognize the dirty bully who unlawfully governs our country under the belief that even one of us, agree.

And because of all these reasons  but mainly, 

and BECAUSE MY SOUL SCREAMS,  

I use the only right that I have left for resistance, 

My resignation.” 

…………………………..

Awesome strength of character by a pure teacher of the young

Yours,

Pano

because,

Earth is one country and all people are citizens…

Yours,

Pano

PS:

True patriots dream of one world living in peace

- Benjamin Franklin

Maybe because they see that there are far too many other issues crowding out the scientific points of view on Climate Change Global Warming and other views on the environmental devastation we wrought — because the state of divisive politics right now has made all ecological issues untouchable…

And by the way, money is not wealth.

Or as Robert F. Kennedy spoke on what GDP meant for him, some fourty four years ago, his wisdom transcends the years since:

“Too much and for too long, we seem to have surrendered personal excellence and community values in the mere accumulation of material things. Our gross national product now is over 800 Billion dollars a year …  But that Gross National Product…

If we should judge America by that — that Gross National Product counts air pollution and cigarette advertising, and ambulances to clear our highways of carnage. It counts special locks for our doors and the jails for the people who break them. It counts the destruction of our redwoods and the loss of our natural wonder in chaotic sprawl. It counts napalm and it counts nuclear warhead, and armored cars for police to fight the riots in our cities. It counts Whitman’s rifle and Speck’s knife, and the television programs which glorify violence in order to sell toys to our children.

Yet the gross national product does not allow for the health of our children, the quality of their education, or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages; the intelligence of our public debate or the integrity of our public officials. It measures neither our wit nor our courage; neither our wisdom nor our learning; neither our compassion nor our devotion to our country; it measures everything, in short, except that which makes life worthwhile.

And it can tell us everything about America — except why we are proud that we are Americans.”

And that fits well here because it is also my view of today’s catastrophic singular focus on money measurement of the economy and of our complete neglect of the environment… and failure to conserve our resources that make up the real wealth and our real global commons. By wasting our natural resources we are diminishing every year both the global commons and our economy in real terms —  because these “externalities” matter and our money measurement culture gets the losing end of the bargain daily.

Because the real global Commons is made up of three simple entities that cannot be measured in GDP and that are truly indivisible and belong to all of us in equal measure. The Atmosphere, the Planet we live in, and the perfectly balanced Environment that allows us to survive. And that is the real global Commons we ought to conserve and spend all of our wherewithal to conserve and maintain in good operating order. On the other hand, the world’s economy is just a networked system of financial economic and trade transactions that might or might not affect our lives greatly depending on how much emphasis we put on this real sideshow. And as it happens we pay inordinate attention to the sideshow, neglecting the real Commons where conservation and protection is of utmost importance and necessary for our survival.

Because if we fail to observe, manage and conserve the real global Commons and fail to institute global coordination of responses to giant problems we’ve created, we shall simply perish. We need desperately the tools of worldwide conservation, in the form of environmental common governance, of clean earth, clean air and clean water, emanating. We want access to these most basic human rights in order to preserve ourselves, that is if we do not want to experience the real tragedy of the Commons as described in the Victorian era ruination of the “village green…”

And as people we’ve faced this issues in the past too and arrived at a system of conserving and protecting the village Green. Not to play golf on, but to manage it as a common grazing pasture, a recreation, an animal feed, a protected environment and as a natural habitat. Somewhat the same is what we are referencing for the earth. Only on a far larger and more abstract way for the earth’s critical ecosystems are our village Commons in their entirety.

And we’ve come up with some interesting institutions to deal with these issues. Valuable institutions that many doubting Thomases, neo-luddites and ideological idiots, now want to disembowel if not abolish altogether… under the guise of economic development. The European Union’s 20/20/20 policy is a great example of this and the development of renewable energy is not the only positive outcome stemming from this great policy.

And the message is clear:
If we take care of the environment, the people and the earth  – the economy will take care of itself.

GDP is not an accurate means of measuring anything relevant to the wealth of nations, because it only measures economic activity and much of it is detrimental to the real wealth and it’s origins. It’s even detrimental to many resources… and to the Peoples of this Earth.

Money is not wealth.

Money after all, was and still is just a clever and convenient invention. And because it was designed as a means of exchange and not as the basic measure of wealth it is ill fitted in it’s new “royal” robes. But somehow that has changed and what was once solely a means to an end has become the end itself, and what was a means of exchange has unfortunately become the only measure of wealth and has gone on to be considered wealth itself. Of course this is a simple delusion foisted upon the simpletons of this earth. No smart person or real intelligence can fathom this as such…  But let this be as it may. Even by that measure for wealth generation, environmental protection in general and EPA in particular is far ahead of it’s time and all other measurements.

Almost half a century has passed since the birth of the Environmental Movement and now we are in a similar path of ecosystem destruction and the hope for redemption is fading fast while we are facing challenges unseen back then and we see certain problems far more great than what our predecessors in the movement ever considered.

We clear cut the rainforests and replace them with vast cow pastures or palm oil plantations or mine the trees and leave the lands fallow, only in order to make industrial process agriculture and a tiny profit. Yet the damage done to the wealth of the nations far surpasses whatever the returns we will ever get out of these lands.

We pollute the rivers, cause anoxic seas, and over-fish the oceans for very little profit and mainly because we do not want to manage our resources. Yet with a little foresight in environmental controls, stoppage of agricultural nitrates runoff, and proper environmental and habitat management we could have sorted out the problem.

We destroy the local economy in search of ever cheaper goods, no matter how much CO2 is emitted in the process and regardless of the human capital costs. Yet with a bot of better management of human resources and product locality we could be seeing a benefit from the globalization trends. Still the bottom line of a few dollars more, always comes first.

We hire and fire people at will, for the sake of balancing the books, meeting financial corporate projections and boosting the economy of the enterprise while we are destroying the overall economy. Yet, the most valuable commodity human capital – people – has now become little more than the switch in the means of production and the instrument of making paper profit.

And all of that in the blind faith and pursuit of some obscure God named money. We are not even talking about folding money, but digital unreal currencies lost at the push of a button in a single FX transaction that might go against you. GM crops, nuclear energy, cloning and animal experimentation – nothing is forbidden – just as long as it adds to GDP and increases the share value of corporations and companies.

Ethics, morality and human dignity are all secondary and subservient to the profit margins. Bankrupt bankers have to be bailed out again and again, even though we can all see that they and all other business leaders are utterly incapable of solving the economic crisis. Politicians and policymakers still want to obey their desires. No wonder that our governments are completely incapable of creating conditions for the stability and well-being of people – because all social, political, educational and communal values — exist solely to serve economic growth, which simply means growth in money supply, in GDP and in consumption.

As long as we are wedded to this financial paradigm and the profit maximization model, the economies will suffer, real capitalism will be decreed amoral, the strong will exploit the weak, and our human, social and environmental fabric will continue to fall apart.

The current economic crisis gives us an opportunity to look deeper and examine the consequences of confusing the means with the ends. Money has a place, of course, but we must keep it in its place and not allow it to dominate our lives in such a manner that we lose all our bearings and become its slaves. Money was made to serve people, not the other way around.

And even with the rudimentary environmental protections, things have progressed greatly and certainly have gone rather badly for the environment over the last 40 to 50 years. Because quite simply the level of threat and problems we’ve created with our present mindset cannot be solved without a serious brain software upgrade or even a new operating system running our head computers. We simply cannot understand the impacts we’ve unleashed in this “the Anthropocene era” of disequilibrium, of magnified returns and of forced results from closed loop ecosystems. Climate forcings are now the norm… with tremendous force storms all the more frequent because of the atmospheric warming up.

Check these little happenings from this last year and prepare adequately for the next one to come, because all of them contribute to the meme sphere of our mind’s attention deficit. The magnitude-9 earthquake in Japan, the momentous climate change summit, the reports on future global “hyperwarming”, and the rumblings about some of the first geoengineering field trials all made 2011 a remarkable year with the environment at centre stage…

The recent cluster of huge quakes around the Pacific Ocean – the December 2004 Sumatra quake, the February 2010 Chile quake, and now the Fukushima one, have fuelled speculation that they are tectonic plates seismically linked and subject to earth’s crust sudden warming and thus releasing their energy forcefully.

The planet is on course for over 3 °C of global warming and maybe up to 5°C by 2025 along with ten billion humans requiring ever more resources yet finding ever less. That temperature rise leaves Greenland – the world’s second-largest ice cap – heading for a melting point of no return. Greenland will surely reach a tipping point in the early 2020s. And after that is curtains because no amount of action on our part, can save the great ice chest of Greenland…

The question of whether climate change is responsible for extreme weather events like the heatwave that set Russia alight in 2010 is one of the hottest topics in climate science. Next year, UK and US climate scientists plan to launch an annual global assessment of whether humans are to blame for the previous year’s extreme weather events. Solving the issue could bring closer the day when disaster victims can successfully sue oil and coal companies.

Field trials for experiments to engineer the climate have begun. When they get approval, a team of UK researchers will hoist one end of a 1-kilometre-long hose aloft using a balloon, then attempt to pump water up it and spray it into the atmosphere. If the test succeeds, a larger-scale version could one day pump sulphate aerosols into the stratosphere, creating a sunshade to offset the greenhouse effect. Ocean iron rust seeding for algae blooms has already begun and many other tests are on track most with a rather negative bend and no discernible positive effects. Plans from formal bodies like shooting and exploding into the high atmosphere strategic nukes to bring on the Nuclear winter, in order to cool down the atmosphere, are contemplated by the US Pentagon.Although too far fetched to even think about, yet they constitute the official Plan B of the US government in case of runaway global warming…

And all of us we are having endless meetings…  that lead to naught. Global Climate Meetings like the Bali, Copenhagen, Cancun, Durban ad infinitum

Yet not a single tonne of carbon was saved in the Durban Climate Change Summit organized by the UN and the conference of the parties. Instead a lot of CO2 was emitted due to thousands of delegates flying around and about and talking till nauseum. Fact is on the short term, the planet will benefit not one jot. Some are calling it a betrayal of both science and the world’s poor and we are calling it a disgrace and a Greenwashing exercise in stupidity. Yet the climate conference in Durban, South Africa, did force major developing nations like China, Brazil and South Africa to accept the principle of future binding targets on their greenhouse gas emissions for the first time…

Gas has become the byword for energy companies wanting to greenwash. But gas drilling especially for shale gas poses a major safety hazard if there are water wells nearby. It appears that gas drilling contaminates the waters nearby and destroys the aquifer. The controversial use of “fracking” is also a huge safety risk as regards water contamination and carries other big risks too.

More than ten million people in the Horn of Africa face a humanitarian emergency as the region grappled with its worst drought in the last century. The main climatic trigger for the droughts was Climate Change, a warmer planet and the La Niña, a cyclical meteorological phenomenon affecting how much rain falls in Africa and elsewhere. We were unable to respond in time and yet we knew of this incoming catastrophe, all along, and as far back as five years in advance.

On 31st of October 2011 or thereabouts, a newborn baby somewhere in the world became the Seventh billion member of the human race. Or so said the UN – but behind the UN’s patina of certainty may lie outdated and unreliable census data. These inaccuracies make it harder to answer a more important question: is human population set to peak within the next few decades or will it carry on growing beyond that to the nine Billion mark as many predict within ten years’ time and then on to double again in seven more years?

The perturbations in the networked biological systems we are dependent on for our survival are becoming far too great to deal with, let alone stop, and are tilting whole systems out of balance. Environmental shocks and overstimulation, via temperature changes, osmotic shocks, pressure changes, chemistry alienation, toxicity, anoxicity, oceanic acidification, desalination, and various inauspicious changes are endangering our existence directly. The way of the Dinosaurs is perhaps our Tom-Tom directional GPS driver assist destination…

Environmental policy and the lack of it of course has greatly shifted in the last 40 years in order to incorporate explicit economic analyses of the costs and benefits of restricting the amount of deadly, toxic, and dangerous pollution that is produced, but it never accounted for the positive wealth creation and preservation of nature. And because of that we are now facing the very difficult public policy debate of why having the EPA at all.

Yet the answer is simple. If only because there is an increasing understanding of how environmental policy can correct market failures, by building freer markets by reducing externalities that distort economic incentives and by protecting resources, we are now finally able to acknowledge these externalities. Those great “external” costs that were so great, we left them untold and unaccountable in the business history of our civilization. But the piper has come on calling…

At last we are responsible for paying for the free lunch we so heartily enjoyed for far too long. The open sewer we call atmosphere is chock full with carbon and is slowly cooking up our planet. Are we awake enough to address this catastrophe or we are to slowly cook in the pot like the poor frogs served in the French brasseries all over Paris?

Do we have any other option but to address the climatic and environmental changes brought on by our pollution that is warming the planet?

The drive toward sustainable development has been non-partisan and relatively non-ideological in the past. Why does it have to become so now?

Most US administrations promoted government-business partnerships by which corporations would voluntarily adopt more sustainable business practices instead of setting mandatory regulations.

With advances in environmental monitoring, economic science, and globalization, corporations have integrated sustainability into their bottom lines — often realizing both short-term, and long term profit as well as brand benefit and general societal profit because of the focus on energy efficiency and long-term viability.

GDP is not an accurate means of measuring anything relevant to the wealth of nations, because it only measures economic activity and much of it is detrimental to the real wealth and it’s origins. It’s even detrimental to many resources… and the Peoples.

Money is not wealth.

Real wealth is our Goldilocks planet as a very fine home to us, and to all other species because of that special chemical balance that we are able to survive into.

Real wealth is our clean air, clean land and clean water to help us survive and thrive.

Real wealth is land, forest, rivers, animals and people.

Real wealth is further created by the imagination, creativity and skill of people understanding their purpose.

Bankers and business leaders in search of ever-increasing profit are not the wealth creators; at best they are wealth counters and at worst wealth destroyers.

So let’s honour the true wealth creators, such as the environmental activists, environmental engineers, mechanics helping natural systems recuperate, skilled workers maintaining forested lands and primary pastures, architects and engineers building sustainable buildings, renewable energy developers, sustainable business leaders, creative civil servants, ethical political leaders, morally responsible governors, imaginative legislative artists, environmental public policy craftsmen, caring mothers and women on top of their professions, all teachers, all doctors, most builders and local small farmers and above all else, let’s honour the children to come. For the future and the economy is theirs and we feel it’s safe in their hands.

Let us respect the generous Earth, Gaia and Nature, the eternal source of wellbeing and prosperity.

Because if we take care of the environment, people and nature, the economy will take care of itself.

Happy New Year and please use this bit of food for thought and action…

Yours,

Pano

Time to change our yard stick.

Maybe GNH is the way to measure success going forward.

Much like Bhutan does.

And it’s cause and effects are well known to us but we are hard pressed to believe it’s not known to them. Because although climate scientists on the frontlines of this battle have suffered badly from the poisonous political atmosphere the science is crystal clear.

Republican rightwing talk radio demagogues and television pundits, have promoted the idea that climate science is a worthless charade, where data are simply manipulated to obtain a politically motivated result. Scientists have been abused on blogs and via emails and some have even been physically threatened. Government officials have misused their positions to intimidate and harass prominent scientists, following a strategy of attacking the messenger when they don’t like hearing the message.

In order to understand the current state of play, one has to recognise that the issue of global warming is being completely manipulated by a group of individuals, businesses and organisations that have entrenched financial interests in making sure that the United States does not enact any legislation to control greenhouse gas emissions. At the extreme, these groups believe in complete market fundamentalism – that free markets, stripped of all constraints, will take care of any and all problems that we may face. Shell, Koch, BP and the coal lobby  to name just a few, have been spending hundreds of million US dollars in poisonous PR to discredit the science and efface reality. They are succeeding…

To bolster this fundamentalist strategy, they provide major financial support to specific pseudo scientific organizations and fake think tanks that promote nonsensical ideas, such as the idea that global warming is a Hollywood hoax perpetuated by Al Gore and his merry men and that the IPCC reports are full of omissions and intentional errors to obscure the fact that all is hanky dory with the world and the sun is shinning bright above stupidville.

They also flood the electoral system with money, to ensure that like-minded rightwing politicians are elected to Congress. These politicians then dutifully hold hearings, inviting hand-picked scientists often with no qualifications in climate science, to provide testimony which sows the seeds of doubt about the reality of global warming. The political objectives of these hearings are rarely discussed by the media. The general public just hears that more scientists disagree about an issue they find hard to deal with, and so they conclude that if scientists can’t agree, why should they support legislation to control emissions? In this way, the cynical but very effective strategy of the rightwing runs its course, and the US sits on its hands while atmospheric carbon dioxide concentrations approach levels not seen on Earth for more than 2.5 million years.

If climate scientists were indeed all working together to manipulate data and create a fictitious scenario of the future, that would require a truly remarkable feat of coordination, and a sense of common purpose. What could the motivation of this cohort be?

Republican Congressman James Sensenbrenner, now vice-chairman of the US House committee on science, space and technology, carefully explained that the Kyoto protocol was a conspiracy by developing nations to cripple the US economy. Since these developing countries, could not compete on a level playing field with the US, they had devised the Kyoto treaty to tilt things in their direction, and climate scientists were complicit in this strategy.

He seems to believe this and therefore he is patently stupid…
And for those who subscribe to Sensenbrenner’s bizarre idea, it is only a small step further to frame the argument in patriotic terms. If you support Kyoto protocol, or its goals, you must be anti-American, or at the very least a socialist if not a Stalinist commie to boot.

The Republican party in the United States is now in thrall to the extreme right wing stupidville, which is in turn financed and coached by the fossil fuel industry and those with the financial & PR muscle to promote their narrow ideological agendas that profit shape their regulatory regimes to their favour. And of course in order to obtain the backing of these groups, you have to toe the line, and speak the words their dogma requires:

1) Global warming is not happening, and it’s an elaborate hoax like Y2K.

2) Whatever warming has occurred is just a natural oscillation.

3) Even if humans had something to do with it, it’s not a big deal and we can adapt to it.

4) We can’t afford to control greenhouse gases, as such action will result in massive job losses.

5) For any politician seeking the Republican party’s nomination for any office, it is a dangerous strategy to cross the line on this topic.

To the idealogues who have invested millions to support their political factotums in the US Congress, their money has been well spent, as meaningful legislation to control greenhouse gases has virtually disappeared from the congressional agenda.

But not content with that success, they have now drawn a line in the sand for all those seeking political office:

Global warming is off limits entirely. It is not something they want to be discussed at all. Guess who leads this country? The BP oil polluters of the Gulf and the Yellowstone? Or the citizens?

So I propose we start a new conversation and a new political party:

Because it’s time for a new Green Tea Party to enter the scene.

We all love tea after all.

Please join up and remember that you heard it here first.

Email us your CV and we’ll hook you up…

Yours,

Pano

PS:

Meanwhile, the rest of the world has recognised the reality of global warming and acknowledged the real dangers that it poses for the future. Although taking steps to address the matter is difficult, many countries have embraced the opportunity to reduce energy consumption, implement conservation strategies and promote new technologies that involve energy production from non-carbon based fuels.

Renewable energy and the wealth inherent in this new industrial revolution towards green is real and the rewards in jobs and economic growth already felt across the globe.

And growing economies while making money is something that even Republicans cannot argue against. Such is the case of Germany, China and Japan that all three have embraced the reality of climate change and grow their green energy industries accordingly.

Let’s see who will be left behind.

As always interpretation leaves us with good news and bad news.

The good news is the earth actually has a spirit, soul, or consciousness. It has a measurable frequency, and the same sort of relative  mass as our own souls which, famously, weigh about 21 grams. Here is a picture of that soul by Astronomer Dr. Fiorella Terenzi. This is what we call Gaia, same as the ancient Greeks did, though this Gaia is not same as the biosphere described by James Lovelock in his Gaia theory book.

The bad news is that this is a photograph of Gaia spirit slowly leaving/leaking/evaporating/dissipating. I hope you’ve enjoyed the seemingly miraculous way that all of nature seems to work as a single coherent whole, because humans have poisoned, drilled, burned, smothered, extinguished, polluted, and caused the extinction of so many living things that Gaia is unable to maintain its continuity for collective consciousness. The implications of a world that has lost its soul are unknown, yet what we really know is that a world without Gaia spirit is incomprehensible.

PS:

We must preserve this fragile Gaia consciously, because as the ancient Amer-Indians believe: “We do not inherit the Earth from our Ancestors, but we borrow it from our Children.”

Or as the early Vedes state: We are all all connected and eternal — nothing ever lost or destroyed, only transformed.

Yet the second Law of Thermodynamics allows for entropy such as this Gaia’s soul leaving for the coldness of space…

The European Union has shifted economic policy greatly.

And it has shifted to the good.

Finally.

This shift is manifest in seemingly small random acts and bureaucratic changes at the leadership level. Retiring the old financial hierarchy and retiring the old school of thought that goes hand in hand with retiring the leadership of the central bank and the transition that just happened at the helm of the bank — is but one of these much welcomed changes. Yet the most important changes we are not even aware of them except when they constitute a signal change.

And this following shift is certainly one of them, because the European Central Bank unexpectedly dropped Stark and replaced him with Peter Praet, a friend and noted Belgian economist as its de facto chief last Tuesday…

Economic Policy Chief that is.

Great big beans you might scoff, but…

This is a major shift for Europe, because it is breaking a tradition in which the absolute German hard-liners occupied that crucial policy-making post in Frankfurt and defined Europe’s economic future fully with what can and cannot be done. ad now this Mr. Praet, whose fiscal renewal policy will succeed none other than the infamous Jurgen Stark realpolitik era. Because Mr Praet as head of the bank’s economic policy and strategy department signals a significant shift that could lead to a creative and non hard-line approach by the institution with the most direct control over the fate of the euro. So that constitutes the good news from the central bank world and from the highest European thought and action leadership.

And this shift only happens now because of the looming clouds of devastating storms and disasters coming up in the horizon.

And now brace for the Bad News:

Right now, the crisis has hit a new high, because there’s an unresolved government crisis in Greece and in Italy and slightly less luster in the French economy. There is also a general worsening of the financial crisis, because all the efforts to leverage the EFSF have run into political, legal or technical difficulties. And here am referring to the European Financial Stability Facility, the bailout fund for the euro zone that can’t decide if it’s a firefighter, a health worker, or an innocent and unconcerned bystander…

That means that currently Europe still has no adequate walls against a possible flare up and no firewall to prevent a disorderly Greek default. And that is what is pushing the financial markets into a renewed panic. I expect the market to fall into despair and panic and I expect that to get worse this year. But the positive end is not unattainable either. We just have to survive another year unmolested in the midst of the freaking masses, the headless and leaderless politicians and the roaming hungry wolves of war and their kin the nasty doom merchants…

And now please feel free to despair…

Because despair may indeed be the right emotion, if you accept your fate and do nothing to avert it.  Since all the predictions of what will happen if European leaders don’t get ahead of the markets are dire, you know the score: Stay docile and do as you are told or else… all hell will break loose is what the message is from all comers. And this is why they want to lead us all hogtied into a war to get our noses out of the depression and the economic malaise we are experiencing.

Because this crisis is truly far bigger than the crash of 2008, and because we have survived the crash of 2008 and we have not yet survived this one, the powers to be have decided to bring in the clouds of war.  Yet in the looming storm there is a danger that even if they get it right, we will all suffer and if they get it wrong then you have a financial meltdown on top of the devastation and ravages of regional and possibly major global conflicts that could erupt. But we won’t go there now and leave this discussion for later…

Because on the strictly economic front; if there is a disorderly default in Greece, and the rest of the euro zone has not been insulated from contagion via a Central Reserve Bank to guarantee the financial and fiscal transactions of the plain vanilla high street depositor banks, then you could have a meltdown not only of the Greek financial system, but of the whole European one and in fact the global financial system because we are all so well interconnected in this global village of ours…

So far, so dire.

And then war might truly be the only option left to us. After all some of you uncanny students of economic and political history might remember that we never really got out of the Great Depression until the end of the Second World War…

War is the father of us all still it seems…

How Daft

But here come some more Good News:

And here are a couple of ideas not just by me but also espoused by some great practitioners of practical enterprise, finance and banking. Here comes the ideas for those of us investors and economic thinkers and high practitioners of finance, who dare to think different. And these two natural ideas are part of the Good News regime that we supply here and those news should perk you up.

One is about the economic bazooka, not the other kind.

And the second one is about Germany’s European leadership and how to use her might in order to avert a real war.

First, the financial bazooka is the strongest financial weapon Europe has to offer. And it seemingly has created this in order to defend all the ailing European economies from the opportunistic and the scardy traders who are betting against them. To end the crisis, Europe needs this bazooka to be big enough, well aimed and fired regularly to punish skirmishers and to convince the market players and the markets that making a war against Frankfurt will be deadly, useless and punitively expensive. In short to randomly punish evil doing profiteers to convince them that going up against the Euro is not the stuff of legend for childish day traders of FX and video game players playing monopoly. Certainly not the morning pill, for the smart wise responsible investors to wager against the Euro either. And all of them will shape up, if they start seeing the carnage littering the Wall streets with their brethren FX traders leaping off high buildings and flying off their windows — having blown their last wad to oppose the European might of the central bank whose economist aims the big bad bazooka’s crosshairs squarely at their forehead and pulls the trigger furiously fast and often.

And this is what our friend Mr Praet shall do. Or at least this is what we expect him to want to do, because he is a thinker and a fighter. And because until now, the story of this financial crisis is one of the European leaders consistently being one step behind the markets. First by bringing their just words to the rukus and failing to defend against the fistfights. Then by getting a sandbag to a fire fight. Then forgetting to bring a gun in the war of the trenches. And finally in this last fight with traders using howitzers, they are forgetting to bring out their own really big and mean bazooka. But that should change in a hurry now…

Because this fight keeps getting more and more bizarre when even in this new year, the verdict of the markets is that the European Financial Stability Facility war chest of €440 billion, or $600 billion isn’t enough. They reason that if you are not gonna use it, this war chest is a continuation of this pattern of insufficiency and weakness. And we say that although the Eurocrats are weak in the knees, this bazooka actually rests in their lap and it has ample ammunition, provided they aim carefully, pull the trigger and fire it the right way and at regular intervals to train the markets and the traders, on what’s what.

But to do just that it takes Balls, Imagination and a bit of a Crazy mean mofo attitude…

Good qualities for a fight, yet all of them in short supply or non existent  in the Eurozone head centres. No such leadership to be found and none such leaders reside in Brussels, Berlin, Paris or beyond, because this broken system does not cultivate independent thinkers as leaders.

Sadly, old Europe first acknowledges defeat and then studies to see what its bazooka can and cannot do. Is it too small to achieve the rescue of Europe’s faltering members directly? Yes and No…

To explain: The bailout fund itself, was designed as a way of providing guarantees on government bonds, but for that purpose it’s clearly inadequate. It cannot be stretched to cover Italy, Spain, Hungary and maybe others.

And here comes the crazy leadership idea and the method of how to apply this to solve the current sovereign borrowing cost crisis: Use the bailout fund by aiming it in a different direction, because the bailout fund not big enough to save the national economies is plenty big enough to save Europe in a different and far smarter way: We should use it creatively and only in order to guarantee the depositor banking system. Thus the banks can become highly re-liquiditized. And then in good shape, they would be able to buy the high-yielding government debt of the European countries that are currently struggling to find lenders and thus shore up the national economies in turn. The member banks would be “strongly encouraged” to hold all their liquidity in their country’s Treasury bills, which they could then sell to the European Central Bank at any moment the need arises. So this method magnifies the bang of the European armaments and it is the equivalent of cash without spending it. And this way, it would yield far more than cash, therefore the banks would naturally hold it. That simple roundabout method of economic leadership, would allow profligate countries like Greece, Italy and Spain during this crisis period to borrow at negligibly higher costs than those that Germany, France or England can borrow at…

All that takes is a good bazooka volley of shots and will clear the field of battle from any FX and Debt instrument trading funds and vulture contenders and then the new cleansed battlefield will become a greenfield. A greenfield opportunity to create a lender of last resort for Europe in one stroke and with the capital to match our aspirations for the European project. With this method, Europe which is currently lacking a lender of last resort, will be trained in the arts of war and also will be battle hardened and battle ready and further able to arm the Central Bank with the star credentials too. And its because the bailout fund would then take the solvency risk, which is beyond the legal right of the European Central Bank, the field of battle will remain clear for many years to come and no new upstart challengers will appear to shake the Eurozone down for their wages of sin.  And getting rid of highway men brings a renewed comfort and security of trade and economic growth and development. And to accomplish all that — all it takes are some well aimed shots of the battle bazooka. And there is plenty of money to do just that. But someone has to be willing to be in the line of fire… and that takes BALLS and crazy MOFO attitude.

In short it takes real leadership.

This plan, would all of a sudden make Greece’s and Italy’s debt “sustainable” because the ECB with it’s new economic leadership will have any amount of money available for the purpose of providing liquidity. At the same time, this method would not violate the law against the ECB directly financing the member governments. This plan is essentially a way to get around Europe’s fundamental economic flaw: A single currency, without the benefit of national monetary policy levers, but also without a lender of last resort… Two birds with one bazooka shot.

It’s a nifty trick, but a trick that would work.

Yet we must do this right now Mr Praet, because the European crisis has metastasized now. And it has moved to many others, mainly because Germany’s intransigence, which has been adamant about blocking precisely this sort of tricks.

The second reason for relative optimism is our conviction that Germany and its leader, Angela Merkel have recently had a crucial change of heart now that they are aware that it is entirely in the hands of Germany to break or save the Eurozone. And here Angela Merkel’s attitude has changed drastically willing to take the hard steps like a new Maggie. She finally recognizes that the euro is in mortal danger and she is willing to risk her political future to save it. And I think she recognizes that Germany historically has caused European crisis and now again is ultimately responsible for this crisis to get out of control. It appears that she is now determined to correct that imbalance and thus avoid further conflagration that might lead to proxy wars and a real fighting deadly war on all fronts. And I don’t mean the financial or economic wars here but the blood gore and human sinew fodder for cannons variety of war.

Yours,

Pano

PS:

Please, Madame Merkel, Read the writing on the wall.

These are good steps yet far more is needed. Great economic imbalances always are the presage to war.

Same as Energy imbalances lead inevitably and inexorably to war.

After all, the economy is just a form of energy management within our “ecos”  within our home, our habitat. It is the Eco- system disharmony and it’s continued grave imbalances that always lead to war.

Dear Angela please remember this. Grave economic imbalances always lead to war. Always…

Yet since it is not too late to save Europe, the Eurozone, and save the Euro and even prevent a catastrophic war — we must act swiftly and act without fear. Act forcefully, in the hope that we might actually avoid the incoming war. To do this we must fight this economic war, with all our might. Let us devote all of our strength and resources in putting out these fires and prosecuting this war fully, in order to avoid the physical one which surely follows – if we fail to correct these imbalances.

But be warned that time is running out and that Europe’s leaders must fundamentally change their strategy to succeed.

Otherwise a global or regional war of attrition has already started…

Lest You forget…

To avert war it takes more energy than to just engage in one.

Building Peace is a hard job but one we are surely fitted to undertake.

And ultimately it’s up to us.

Me and You

And capitalism is vastly different from the pure Free Markets and far itfrom socialism or communism. And yet contains all of these inside it’s workings in order so it can still work in the 21st century, and perhaps work better than all other systems we’ve come up with. But Capitalism as it now operates needs some serious recalibration and retooling. The system needs a total rebuild and our attitude towards economic policy and ideology needs a real reboot. Because if we are going to say that anything about 15% taxation as a proportion of GDP is “socialism” as many do today in the US, then the USA was socialist during its best years yet. Oddly enough, we’re not running at 15% taxation and 25% spending. This isn’t socialism nor capitalism. It’s a simple fallacy because we are running on empty, and the uncertainty is destroying the confidence of all well informed capitalists and economists. No wonder the economy is still stalling and we are not seeing the green shoots of recovery and growth yet.

Because markets have inherent and well-known inefficiencies we need to compensate for them. One factor is failure to calculate the costs to those who do not participate in transactions. These “externalities” can be huge. That is particularly true for financial institutions.
Their task is to take risks, calculating potential costs for themselves. But they do not take into account the consequences of their losses for the economy as a whole.

Hence the financial market “underprices risk” and is “systematically inefficient,” as John Eatwell and Lance Taylor wrote a decade ago, warning of the extreme dangers of financial liberalization and reviewing the substantial costs already incurred – and also proposing solutions, which have been ignored.

The threat became more severe when the Clinton administration repealed the Glass-Steagall act of 1933, thus freeing financial institutions “to innovate in the new economy,” in Clinton’s words — and also “to self-destruct, taking down with them the general economy and international confidence in the US banking system.

Americans have traditionally been the most enthusiastic champions of capitalism.  Yet a recent American public opinion survey found that just 50 per cent of people had a positive opinion of capitalism while 40 per cent did not.  The disillusionment was particularly marked among young people 18-29, African Americans and Hispanics, those with incomes under $30,000 and self-described Democrats.

Three elections in a row in the U.S. have been bloodbaths by recent standards for incumbents, with the left side doing well in 2006 and 2008 and the right winning comprehensively in 2010.  With the rise of the Tea Party on the right, and the Occupy movement on the left, this suggests far more is up for grabs than usual in this election year.

So how justified is disillusionment with market capitalism?  This depends on the answer to two critical questions. Do today’s problems inhere in today’s form of market capitalism or are they subject to more direct solution? Are there imaginable better alternatives?

The spread of stagnation and abnormal unemployment from Japan to the rest of the industrialized world does raise doubts about capitalism’s efficacy as a promoter of employment and rising living standards for a broad middle class.  This problem is genuine. Few would confidently bet that the U.S. or Europe will see a return to full employment as previously defined within the next 5 years. The economies of both are likely to be constrained by demand for a long time.

But does this reflect an inherent flaw in capitalism or, as Keynes suggested, a “magneto” problem (like the failure of a car alternator) that can be addressed with proper fiscal and monetary policies, and which will not benefit from large scale structural measures? I believe the evidence overwhelmingly supports the latter. Efforts to reform capitalism are more likely to divert from the steps needed to promote demand than to contribute to putting people back to work. I suspect that if and when macroeconomic policies are appropriately adjusted, much of the contemporary concern will fade away.

That said, sharp increases in unemployment beyond the business cycle—one in six American men between 25 and 54 are likely to be out of work even after the U.S. economy recovers—along with dramatic rises in the share of income going to the top 1 and even the top .01 per cent of the population and  declining social mobility do raise serious questions about the fairness of capitalism. The problem is real and profound and seems very unlikely to correct itself untended. Unlike cyclical concerns there is no obvious solution at hand. Indeed the observation that even Chinese manufacturing employment appears well below the level of 15 years ago suggests that the problem’s roots lie deep with the evolution of technology.

The agricultural economy gave way to the industrial economy because progress enabled demands for food to be met by only a small fraction of the population, freeing large numbers of people to work outside agriculture. The same process is underway today with respect to manufacturing and a substantial range of services reducing employment prospects for most citizens.  At the same time, just as in the early days of the industrial era, the combination of substantial dislocations and greater ability to produce at scale is enabling a lucky few to acquire great fortunes.

The nature of the transformation is highlighted by the 50-fold change in the relative price of a television set of a constant quality and a day in a hospital over the last generation.  While it is often observed that wages for median workers have stagnated, this obscures an important aspect of what is occurring. Measured via items  such as appliances or clothing or telephone service where productivity growth has been rapid, wages have actually risen rapidly over the last generation.  The problem is that they have stagnated or fallen measured relative to the price of housing, health care, food and energy or education. As fewer and fewer people are needed to meet the population’s demand for goods like appliances and clothing, it is natural that more and more people work in producing goods like health care and education where outcomes are manifestly unsatisfactory.  Indeed as the economist Michael Spence has documented, a process of this kind is underway; essentially all employment growth in the U.S. over the last generation has come in non-traded goods.

The difficulty is that in many of these areas the traditional case for market capitalism is weaker. It is surely not an accident that in almost every society the production of health care and education is much more involved with the public sector than the production of manufactured goods.  There is an imperative to move workers from activities like producing steel to activities like taking care of the aged.  At the same time there is the imperative of shrinking or least slowing the growth of the public sector.

This brings us to the charge that the governments of industrial market capitalist societies are bankrupt. Even as market outcomes seem increasingly unsatisfactory, budget  pressures have constrained the ability of the public sector to respond.  How and when–and not whether–basic programs of social protection will be cut back, is now back on the table.  The basic solvency of too many capitalist states seems in question.

Again the problems are very real.  While I believe more than most that the U.S. government will be able to borrow on very attractive terms for a long time, if as I fear private borrowing remains depressed, there is no denying that the current path of planned spending and planned revenue collection are inconsistent.  And Europe is teaching us that markets can take significant fiscal problems and make them catastrophic  by becoming too alarmed too rapidly.

At one level the answer here is simply to insist on more political will and courage.  But at a deeper level, citizens of the industrial world who believe that they live in progressive societies are right to wonder why increasingly affluent societies need to roll back levels of social protection. Paradoxically, the answer lies in the very success of capitalism which has made the opportunity-cost of an individual teaching or nursing or administering that much more expensive.

When outcomes are unsatisfactory, as they surely are at present, there is always a debate between those who believe that the current course needs to be pursued with increased vigor and those who argue for a radical change in direction. That debate  is somewhat beside the point in the case of market capitalism. Where it has been applied it has been an enormous success.  The challenge for the next generation is that while that success will increasingly be taken for granted and indeed will become an increasing source of frustration in these pinched times, its success cannot be matched outside the market’s natural domain.  It is not so much the most capitalist parts of the contemporary economy but the least—those concerned with health, education and social protection–that are in most need of reinvention.

The unprecedented intervention of the Fed may be justified or not in narrow terms, but it reveals, once again, the profoundly undemocratic character of state capitalist institutions, designed in large measure to socialise cost and risk and privatize profit, without a public voice.

That is, of course, not limited to financial markets. The advanced economy as a whole relies heavily on the dynamic state sector, with much the same consequences with regard to risk, cost, profit, and decisions, crucial features of the economy and political system.” some balance to the debate…

Capitalism, by its nature, requires the free market pricing mechanism to function properly. It is disingenuous to criticize capitalism as flawed due to the problems the United States is experiencing when this depression is arguably the result of the LACK of a free market.

At its core, a free market requires price discovery. The marketplace must be allowed to clear all prices. However, the most important price in the market… the price of money… has been manipulated for decades by central banks. This distortion generates ripple effects throughout every decision-making process… every industry… which can only result in misappropriated resources, which then must inevitably result in depression.

The 3 basic issues with the health of capitalism in the US, the EU  and around the world are the following three:Overuse of Leverage, Tax Structure that favors Speculation, and Subsidized Industries such as oil, gas, banks, real estate, big agrobusiness etc.

1) Overuse of leverage is the main culprit of the 2008 Great Recession, as it has been in any great collapse. Any investor knows the dangers of a margin call, and we have just seen a major margin call worldwide. Summers also ignores how the huge growth of derivatives since 1980s (an extension of credit and leverage) have turned investment markets into speculators’ roulette wheel.

2) The US Tax Structure since the 1980s has reduced short term capital gains and derivative income/gains by more than 70% while at the same time tripled the payroll tax on middle income AMericans. The “carried interest” use by hedge funds and private equity, plus off-shore tax havens have allowed speculators to pay extremely low tax rates, thus pushing out the traditional long term investor which is vital to capitalism. Summers can take direct credit for this trend.

3) Finally, the US government subsidizes through low tax rates, outright cash grants and extremely low regulations the very industries that have not provided any growth to the US labor force for over 30 years: oil/gas, agriculture and real estate. Depletion allowance, 1031 exchanges, crop subsidies, etc. all distort the market economy and shift resources away from viable industries. Of course, this policy is only in place because of the huge dollars political campaigns receive from these industries, but that is another matter altogether.

There’s a difference between capitalism and the free market. The US is definitely capitalist but it’s markets are not free. With a handful of telco’s and a half dozen nation-wide banks, the natural course of capitalism is to grow, dominate, and create as much of a monopoly as possible. Smaller companies are bought by larger as the larger grows larger until competition, a necessary element of the free market is choked by the success of capitalism.

Of course the Government gets in the way of the free market too, but usually at the request of some capitalist looking to benefit from it.

But there is a fundamental problem with advocates of a purely free market and it isn’t an economic one, it’s political. It just won’t ever happen. Those who argue for modest reforms will never let the radicals have a clear go at it.

For a huge impact, one must take a conglomeration of moderate proposals and bundle them together. Unfortunately that has not been done very well.

Capitalism would work if we control speculation, promote a fair tax policy and do not subsidize healthy industries.

In essence mix and match political ideologies for a common cause future without ideological barriers, mental burdens and false hopes.

Yours,

Pano

PS:

Crises happen always. Whatever goes up must come down. The weather changes and the seasons are repeating themselves endlessly. Why you think that the markets are immune to change?

Change is everything and the only constant we have…

Yet our current reaction unfortunately, has been of the ostrich variety and it only more of the same old system reactions…

Because we use central planning sparingly and not strongly applied when the medicine is bitter as it should be… Instead of attracting new ideas and establishing new standards to try to avoid the failures and the ill symptoms of central planning, we forget the failures of past and plunge head first into the quagmire. Because by restoring full free market capitalism and by giving it a chance to work it’s kinks and it’s inefficiencies fully as it’s cyclical nature demands, we need to allow time to digest the effects before dismissing the concept.

Capitalism in the US is disliked because capitalism worldwide is on steroids and life support. It has been and is still actively promoted by policies, people and entities disinterested in the broader welfare of society vs the health of The Investor. The basic premise is that The Investor reigns supreme over the legislator and his standing management instructions to the state are incorporated in the Washington Consensus.

Legislators are lobbied with boatloads of dollars to maintain pliant, docile attitude to the big business. Big banks are lauded, courted and worshipped as the pinnacle of big business no matter how badly they behave. Corporate taxation is considered a patent sin and must be rolled back at any costs and income inequality is seen as a positive sign of the success of the individual in a multifarious society regardless of real worth and true merit.

Am afraid that if we maintain this attitude long enough, history will inevitably ensure that it will produce its own backlash. Alienate enough people for a sufficiently long time and they will one day start the pendulum swinging back against all-out capitalism.