A Time For Transformation

The type of people who make it to the corporate big-leagues are, more often than not, Narcissistic, sociopathic or functional psychotics. Expecting these people to self-regulate is like expecting Ted Bundy to self-regulate.

The more wealth and power they have the more dangerous they are to the nation and her people.

If the jerks who went batshit crazy on Wall street with their various schemes for personal enrichment are allowed to simply walk away with all the loot they have garnered from their irresponsible if not criminal behavior, nothing good can come of this BushCo scheme/bailout for one company after another, because they are too big to fail.

"Voodoo economics" has been a disaster for this nation and her people, with the exception of maybe 1% of the most wealthy.

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You hear that implosion reverberating through financial markets? It's the sound of decades of conservative ideology collapsing.

This raises many pressing questions, both short- and long-term. What's the deal with the Paulson deal? There's a lot of well-aimed skepticism about this plan, and myself and my EPI colleagues will be commenting on it all week (I'm not liking what I'm seeing--not enough safeguards to protect taxpayers from banks perfectly happy to dump toxic debt on the government; not enough quid pro quos for Main Street). But for now, I'd like to focus on an even more important question: what next?

The week that just ended revealed the myth of market fundamentalism: the notion associated with mainstream, Milton Freidman'esque economics, and amplified by anti-government conservatives that unfettered markets will provide society with the best outcomes. Such simplicity, such elegance...such nonsense.

For many of us, it didn't take a market failure of the magnitude we've witnessed in recent weeks to belie this myth. We've been documenting the slow bleed of much subtler market failures for decades. Most recently, we've stressed that despite years of growth before the recent downturn, the real income of middle-class working-age families fell $2,000. Poverty rose. The share of the population without health coverage went up. For the first time in years, the rate of home ownership declined.

If that's Bush's ownership society, please don't sign me up (in truth, it's too late to refuse membership: as taxpayers, we're now proud owners of a growing pile of toxic debt--thanks, George).

But slow bleed or sudden shock, the idea that I've described as YOYO (you're on your own) economics is seriously on the ropes. I still encounter some old school ideologues on the CNBC airwaves, but they're fewer and more contrite, and, interestingly, they generally support the bailouts. Apparently, their mantra is actually "you're on your own; we're lookin' for a bailout." It's privatize the profits, socialize the losses; patriotism for the masses, socialism for the rich.

Such chatter will always be heard, but progressives have a rare opportunity to change the economic debate in this country by injecting some glaringly obvious truths into the fray, such as:

--Deregulated markets cannot police themselves; they tend toward speculation, vastly under-priced risk, and deeply damaging bubbles;

--An economy that generates growth while leaving most families behind is a broken economy;

--We can neither achieve broad prosperity nor compete globally without robust growth in key sectors which we have ignored or underfunded, including manufacturing, green production, and cradle-to-retirement public education; crafting evermore clever financial instruments will not pave the way to dependable, broadly shared growth;

--No private sector firm should be too big to fail; any firm of that magnitude must be nationalized;

--Capital markets are dysfunctional; borrowing and lending standards are ignored; lax capital requirements lead to constant over-leveraging; shadow accounts thwart transparency;

--We apparently can quickly find (or borrow) the money to do the stuff the authorities deem necessary, be it war or bailout; thus, we can also find the money we need for investment in people, from health care to education to infrastructure, etc.

--Supply-side, trickle-down economics does not work; it exacerbates already excessive levels of market-driven inequalities and defunds government, which leads to:

--Clearly, we need government to be amply funded; as is the case today, we will always turn to federal government to meet the toughest challenges, and if the money isn't there, we'll borrow from the future. This means taxes cannot only be lowered; they must sometimes be raised.

--For decades, under the spell of mainstream theories like "rational expectations" (bubbles can't form because prices can't diverge from reality for long), economists and policy makers have missed almost every big market failure, including the last two bubbles (in IT and housing). Government intervention is only "distortionary" in these models, adding the anti-gov't bias since Reagan. We desperately need policy makers and their economists to be much better analysts of markets and how they fail. It is not an exaggeration to state that much of what's gone wrong in the current case could have been avoided by better oversight, common-sense regulation, and clear-eyed analysis of economic indicators that should not have been missed.

If I were Martin Luther, I'd hammer such a list--and this is just a rough draft--feel free to edit and comment--to the doors of the Federal Reserve, but I'd probably get arrested or worse the minute I took out my hammer.

The point is that these are potentially transformational times.

Transformations evolve out of crises. As the great Robert Kuttner stresses in his new book, the big social movements that have transformed our politics have often resulted from the collision of brave, visionary leaders and major upheavals: Lincoln and the Civil War, FDR and the Depression, Johnson and the Civil Rights movement. Kuttner believes the stage is set for the next transformation, this time from a broken economy that threatens American prosperity to one that works for everyone.

After reading Bob's book, I sent him a note pointing out that it might well be a lot harder to motivate major change given the slow bleed we've experienced versus civil war, economic depression, or mass protests and burning cities.

But that was before the bust of the last few weeks, before the onset of a crisis of capitalism that is widely described as the worst market meltdown since the Depression, before the most aggressive government intervention into the economy I've seen in my lifetime. Maybe these recent events fail to rank with those motivating Kuttner's insights, but they're getting awfully close.

What has to happen to realize the transformational potential of the moment? It's quite amazing that this is occurring during the very moment in a pivotal election when a) the electorate is starting to pay attention, and b) the economy is the dominant issue.

The candidates are already grappling with these issues, both stressing some versions of the lessons I noted above, which is a nice way of saying McCain is adopting the mantel of reformer and regulator in order to convince pissed-off voters of his midnight conversion from a legislator who accommodated a lot of this damage to one who will fix it. But he's so changeable these days, even uninformed voters are seeing there's not much to to his populist railing. It's all starting to sound like a pretty unhinged "I'll say anything to get your vote!"

Obama's got a head start. He's much less ideological about all this stuff, with a strong pragmatic bent and a willingness to listen to diverse views. He's also been talking for a while about the need to regulate financial markets, and his ideas are sound. Had they been in place, a lot of this mess would not have occurred.

But, as Kuttner stresses, that doesn't mean he will be transformational, or recognize the importance of injecting views like those above into the heart of the national debate. He certainly has that capacity--the vision, the intellect, and the ability to present the big picture in an extremely compelling way. This may be one of those times when the collision of a great leader and cataclysmic events can turn the tides.

Or not. It all hinges on the next few days, weeks, and months.

Jeez...watching history unfold in front of you like this is sure worth the price of admission, ain't it?


(In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. I.U. has no affiliation whatsoever with the originator of this article nor is I.U endorsed or sponsored by the originator.)


The Nazis, Fascists and Communists were political parties before they became enemies of liberty and mass murderers.

No Wonder The NeoCons Lost Iraq....

...and they will lose America for many of the same reasons.

That is, unless America is already lost and AmeriCo has taken it's place.

God, this makes me sick!

Published on Thursday, September 13, 2007 by CommonDreams.org

Testimony of The Tortured

by Jeremy Scahill

When President Bush dispatched the neoconservative “terror expert” Paul Bremer to Baghdad in the summer of 2003, it took the former staffer to Henry Kissinger just two weeks to boldly declare that Iraq was “open for business.” Naomi Klein, who traveled to Iraq during Bremer’s one year stint in the country, writes in The Shock Doctrine: “Overnight, Iraq went from being one of the most isolated countries in the world, sealed off from the most basic trade by strict UN sanctions, to becoming the widest-open market anywhere.”

Bremer swiftly set about wiping Iraq clean and applying Milton Friedman’s radical economic formula in the Arab world, a region Klein calls “the last holdout for this neoliberal crusade.” This, Klein writes, would come in the form of “mass privatization, complete free trade, a 15% flat tax and a dramatically downsized government.” As Klein says, it was an anti-Marshall Plan. And while it appeared early on in Bremer’s tenure that the neoconservatives were winning, it didn’t take long for the temporary euphoria of life without Saddam to be overcome by a collective Iraqi rage at the US agenda.

Even US allies like the interim trade minister, Ali Abdul-Amir Allawi, declared Iraqis were “sick and tired of being the subjects of experiments. There have been enough shocks to the system, so we don’t need this shock therapy in the economy.” This radical economic agenda, combined with the disastrous de-Baathification policy, which not only resulted in tens of thousands of state workers losing their jobs overnight, but also some 250,000 Iraqi soldiers, meant that the “Bremer agenda” would just as radically give rise to a widespread Iraqi resistance to the occupation, the likes of which the “cake walk” theory promoters could never have envisioned.

As the situation on the ground rapidly deteriorated, the job of keeping alive Bremer, the most hated man in Iraq, was not given to the US military, but rather was “awarded” - through a no-bid $27m contract - to the politically-connected mercenary firm, Blackwater USA, whose owner, Erik Prince, is a major donor to the political campaigns of President Bush and his allies, as well as to the core groups that make up the radical religious right in America. As Bremer opened Iraq up for business, his own life would be placed in the all-powerful hands of the free market. “If Blackwater loses a principal [like Bremer], they’re out of business, aren’t they?” asked Colonel Thomas Hammes, the US military official in charge of building a “new” Iraqi military after Bremer disbanded the old one. “Can you imagine being Blackwater, trying to sell your next contract, saying, ‘Well, we did pretty well in Iraq for about four months, and then he got killed.’” Hammes, who said he himself was run off the road by Blackwater mercenaries, said Blackwater “made enemies everywhere,” but added, “they were doing their job, exactly what they were paid to do in the way they were paid to do it.”

It was this period, as Bremer ran around Iraq with his Blackwater mercenaries destroying the economy, that began the epic conflict that would unfold with a stunning degree of bloodshed and loss of life - overwhelmingly Iraqi. But you wouldn’t get that from watching CNN or Fox News. Iraq has become one long series of car bombs and “sectarian violence.” There is no context and almost no mention of the on-the-ground policies of Bremer in that first year when the pundits discuss Iraq. Iraqis are simply people who want to blow each other up and murder their liberators. More importantly, the destruction of Iraq’s economy and civil society - which began a full decade before the 2003 invasion with the 1991 Gulf War and a decade of devastating economic sanctions - and the ensuing carnage are almost never viewed through the lens of more than 40 years of US global policy that preceded the Iraq occupation and indeed laid the groundwork for the present reality.

This is where the brilliance of Klein’s analysis shines through. She thoroughly exposes the historical roots of the first year of the occupation and provides the most comprehensive analysis to date on how we got to where we are today. The Shock Doctrine is equal parts meticulously documented scholarship and old-fashioned reporting. Klein is indeed an embedded journalist, but never with the occupying armies - she has embedded with the poor and suffering, the victims of economic and literal shock. John Loyd charges Klein with promoting the “conspiratorial version of history.” No. What Klein has done is to take the testimony of the tortured and destroyed, mix it with a scathing confrontation of their oppressors (often using their own words) and produce a 576-page expose that breaks a decades-long silence on the consistency of this mass economic and military violence.

In Iraq, Klein charges: “When Iraqis resisted, they were rounded up and taken to jails where bodies and minds were met with more shocks, these ones distinctly less metaphorical.” Her explanation of the creation of the CIA’s 1963 Kubark torture manual, the product of years of covert research and human experimentation, applied throughout Vietnam in the 1960s and Latin America in the 1970s and beyond, is chilling, particularly when you see it all over the bodies of naked Iraqi prisoners at Abu Ghraib in 2003.

Only because of her extensive time spent among the people of Latin America, Asia, New Orleans and the Middle East is Klein able to draw the kinds of connections left off the pages of the New York Times and which seem so “conspiratorial” to those who cherry-pick sections of her book. Klein’s book is not the product of a conspiracy theory. Following the money, asking who benefits and then answering the question isn’t conspiracy peddling, it is called good reporting.

Is it mere coincidence that the same corporate vultures and think tank warriors (as Klein calls them, “the people who are paid to think by the makers of tanks”) descended literally and ideologically on Iraq, Afghanistan, New Orleans and the Tsunami-ravaged countries to emerge as the beneficiaries of these disasters? “I discovered that the idea of exploiting crisis and disaster has been the modus operandi of Milton Friedman’s movement from the very beginning - this fundamentalist form of capitalism has always needed disasters to advance,” Klein writes. “It was certainly the case that the facilitating disasters were getting bigger and more shocking, but what was happening in Iraq and New Orleans was not a new, post-September 11 invention. Rather, these bold experiments in crisis exploitation were the culmination of three decades of strict adherence to the shock doctrine.”

I recently talked with Klein about Iraq and asked her what victory the Bush administration was gaining there. “I think that they rigged the war so that it couldn’t lose,” Klein told me. “There were two forms of privatization that were happening simultaneously. One was the Bremer agenda, of going in and privatizing Iraq’s economy and then hoping for that model to spread throughout the region, and I think we can safely say that that was a failure.” As many corporations fled Iraq in the midst of escalating violence in 2004, Klein thought she “was seeing the first failure of this economic crusade because corporations that had taken small steps towards investing in Iraq and being part of this privatization frenzy were all pulling out because they were afraid for their lives.”

Klein says she “really reconsidered that assessment the more I looked at the other privatization agenda, which is the way in which the war itself was a laboratory for the US state to privatize itself. Either way this is sort of like an unprecedented phenomenon - the idea of going to war not just to loot your enemy, but to loot yourself.”

She points out that “the worse things have gotten in Iraq, the more privatized the war becomes. When it wasn’t the cakewalk that they were claiming it would be, the gaps had to be filled somewhere, and how they were filled was by these private contractors. So was this experiment a failure? I think it has taken this project of neoliberalism, of corporatism to an entirely new, more sophisticated and terrifying phase where, really, Iraq isn’t occupied by the United States government, it is a hollow occupation where you have military officials and government officials fronting it, but behind them everything is run by contractors.”

Indeed, in Iraq right now, there is no coalition of willing nations, but rather a coalition of billing corporations. Today, it is the contractors and mercenaries who outnumber US forces in Iraq. As of July 2007, there were more than 630 contracting companies working in Iraq for the US. Composed of some 180,000 individual personnel drawn from more than 100 countries, the army of contractors surpasses the official US military presence of 160,000 troops. Last year, a US government report estimated there were 48,000 people working for more than 170 private military companies in Iraq. “We are certainly seeing the emergence of a true corporate state,” Klein says. “Iraq has just catapulted the project forward, and then we see it reverberate around the world.”

Jeremy Scahill is the author of the New York Times bestseller Blackwater: The Rise of the World’s Most Powerful Mercenary Army. He is currently a Puffin Foundation Writing Fellow at the Nation Institute.

© Copyright 2007 Jeremy Scahill

(In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. I.U. has no affiliation whatsoever with the originator of this article nor is I.U endorsed or sponsored by the originator.)


The Nazis, Fascists and Communists were political parties before they became enemies of liberty and mass murderers.