The Federal Reserve And The Pathology of Power
by ilene - November 18th, 2010 10:50 am
Courtesy of Charles Hugh Smith, Of Two Minds
The Federal Reserve and the Pathology of Power
The Federal Reserve is an example not just of run-of-the-mill hubris but of the far more profound Pathology of Power.
The rule of law has been supplanted in the U.S. by self-serving propaganda campaigns serving State and financial Elites: this is the Pathology of Power. The Federal Reserve is an instructive example because it is so blatant.
Despite the dearth of evidence that goosing the stock market actually generates a "wealth effect" which "trickles down" from the top 10% who own the vast majority of equities to the bottom 90%, the Fed has waged a ceaseless propaganda campaign claiming this policy goal is now essential for the nation’s well-being.
As Ben Bernanke recently made clear: "Higher stock prices will boost consumer wealth and help increase confidence, which can also spur spending (that) will lead to higher incomes and profits that, in a virtuous circle, will further support economic expansion."
No mention of its positive effect on Wall Street; cui bono (to whose benefit?) indeed. To better understand the pathology of power, we should turn first to Pathology Of Power by Norman Cousins, published in 1988.
Cousins was particularly concerned with the National Security State, a.k.a. the military-industrial complex, which at that point in U.S. history was engaged in a Cold War with the mighty Soviet Empire.
In a classic case of structural decay and destabilization (including failed coups), the Soviet Empire dissolved in December 1991. Nonetheless, Cousins’ description of the pathology of power is an uncannily accurate account of the Fed and all the Central State fiefdoms.
"Connected to the tendency of power to corrupt are yet other tendencies that emerge from the pages of the historians:
1. The tendency of power to drive intelligence underground;
2. The tendency of power to become a theology, admitting no other gods before it;
3. The tendency of power to distort and damage the traditions and institutions it was designed to protect;
4. The tendency of power to create a language of its own, making other forms of communication incoherent and irrelevant;
5. The tendency of power to set the stage for its own use.
In broader terms, we might add: the tendency of power to manifest hubris, arrogance, bullying and the substitution of…
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Obama argues his assassination program is a “state secret”
by ilene - September 26th, 2010 5:16 pm
Obama argues his assassination program is a "state secret"
At this point, I didn’t believe it was possible, but the Obama administration has just reached an all-new low in its abysmal civil liberties record. In response to the lawsuit filed by Anwar Awlaki’s father asking a court to enjoin the President from assassinating his son, a U.S. citizen, without any due process, the administration late last night, according to The Washington Post, filed a brief asking the court to dismiss the lawsuit without hearing the merits of the claims. That’s not surprising: both the Bush and Obama administrations have repeatedly insisted that their secret conduct is legal but nonetheless urge courts not to even rule on its legality. But what’s most notable here is that one of the arguments the Obama DOJ raises to demand dismissal of this lawsuit is "state secrets": in other words, not only does the President have the right to sentence Americans to death with no due process or charges of any kind, but his decisions as to who will be killed and why he wants them dead are "state secrets," and thus no court may adjudicate their legality.
A very intense case of food poisoning in New York on Thursday, combined with my traveling home all night last night, prevents me from writing much about this until tomorrow (and it’s what rendered the blog uncharacteristically silent for the last two days). But I would hope that nobody needs me or anyone else to explain why this assertion of power is so pernicious — at least as pernicious as any power asserted during the Bush/Cheney years. If the President has the power to order American citizens killed with no due process, and to do so in such complete secrecy that no courts can even review his decisions, then what doesn’t he have the power to do?…
Read more at www.salon.com
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Whitney: Obama Is ‘a Public Relations Hologram’
by ilene - August 12th, 2010 12:38 pm
Great quote about Obama. - Ilene
Whitney: Obama Is ‘a Public Relations Hologram’
As you know I have been trying to ‘figure out’ Barack Obama and his mysterious background and equally mystifying rise to power, without having done anything notable, either in business, or civil service, or even military service. Granted, he talks one hell of a game but always seems to fall short. He seems to have less substance, far less accomplishments than his fellow actor in the White House, Ronald Reagan, who had been a governor before becoming President.
Perhaps the answer is as simple as this.
"It’s hard to believe that a two-year senator from Chicago with a background in ‘community organizing’ presides over this elaborate and opaque system of imperial rule. He doesn’t, of course. The real leaders remain hidden behind the cloak of democratic government and all of Washington’s phony institutions. Obama is merely a public relations hologram, a friendly face that conceals the machinations of a global Mafia. Other people--whoever they may be--control the levers of power moving the pieces as needed to assure the best outcome for themselves and their constituents." Mike Whitney, Kill Hugo?
Well, unlike his predecessor, at least he has not tortured anyone that we know about.
Picture via Via Chuck DeVore, via Jr. Deputy Accountant
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The Trouble with Tim’s Treasury
by ilene - July 21st, 2010 1:37 pm
The Trouble with Tim’s Treasury
Courtesy of New Deal 2.0, by Marshall Auerback
FinReg may fall short if power is channeled into Geithner’s hands.
More depressing news from the “change” President. The Washington Post has reported that one of the major impacts of the FinReg bill passed last week by Congress is the accretion of new power to Obama’s Treasury Secretary. According to the Post, Tim Geithner stands to inherit vast power to shape bank regulations, oversee financial markets and create a consumer protection agency.
Make no mistake: this is Timmy’s bill, plain and simple, as the Post makes clear: “The bill not only hews closely to the initial draft he released last summer but also anoints him — as long as he remains Treasury secretary — as the chief of a new council of senior regulators.”
The Geithner Treasury repeatedly pushed back against many sensible legislative proposals that would have made significant structural changes to practices that brought about the current economic crisis. And the article itself represents latest in a series of attempts to embellish the Treasury Secretary’s hagiography.
Reading it, one wonders whether the Washington Post inhabits a strange parallel universe. Have the writers actually paid attention to what is truly happening in the economy? The WaPo persists in towing the party line that Geithner’s tenure has been marked with conspicuous success, supposedly by advocating a response to the financial crisis that allegedly later proved correct: “Geithner vigorously resisted calls by some lawmakers and financial experts to nationalize the nation’s largest and most troubled banks during the most perilous days. Instead, he helped get the financial system back on its feet, in particular by pressing for stress tests of big banks.” (my emphasis)
Oh, really? I would argue that Washington continues to allow the big banks to operate “business as usual” and to cook the books to show profits so that they can pay out big bonuses to the geniuses who created the toxic waste that brought on the crisis. Most continue to show profits based not on fundamentally health lending activity, but one-off gains, and accounting gimmickry. Commenting on the latest JP Morgan results, my friend and colleague Randy Wray has noted:
JP Morgan’s results were horrendous: it lost…
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G20 Thinking: “In The Medium Run We Are All Retired”
by ilene - September 22nd, 2009 2:41 pm
In other words, don’t expect much. – Ilene
G20 Thinking: “In The Medium Run We Are All Retired”
Courtesy of Simon Johnson at The Baseline Scenario
It looks like the G20 on Friday will emphasize its new “framework” for curing macroeconomic imbalances, rather than any substantive measures to regulate banks, derivatives, or any other primary cause of the 2008-2009 financial crisis.
This is appealing to the G20 leaders because their call to “rebalance” global growth will involve no immediate action and no changes in policy – other than in the “medium run” (watch for this phrase in the communiqué).
When exactly is the medium run?
That’s an easy one: it’s always just around the corner. Not today, of course; that would be short run. And not in 20 years; that’s the long run.
The medium run is perhaps in 3 years or perhaps in 5 years. It feels close enough not to be meaningless at the press conference, but it’s not close enough to be meaningful.
And – here’s the key – whatever you agree on for the medium-term, you know that the world will change, quite dramatically, 2 or 3 times before you get there. At that point you can say, quite reasonably: But the conditions today are quite different from what they were when we made this medium-term commitment, so we really need to rethink it.
Of course, having the IMF report back every year on progress towards these medium-term goals is equally pointless. This is what the IMF has been doing since 2006 and what it was preparing diligently to do just as the global crisis broke out.
Expectations for the G20 summit are low. But unless and until the leaders take any steps to address our pressing financial sector vulnerabilities, the summit is not worth its carbon footprint.
Remember what the financial experts said at the previous summit (April) and the one before that (November): we can’t fix the financial system in the height of the crisis. True enough, although the opportunity to break the power of the largest players was squandered in both the US and Europe.
So, now the crisis is over – as the G20 heads of government will affirm – where are their efforts to fix the financial system? Please don’t tell me, “that’s what we’re doing, in the
…
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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
Ilene is editor and affiliate program
coordinator for PSW. She manages the Favorites backup site
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