Michael Hudson: Obama’s Master Class in Demagogy 101

By Michael Hudson, a research professor of Economics at University of Missouri, Kansas City, and a research associate at the Levy Economics Institute of Bard College. His latest book is “The Bubble and Beyond.”

Yesterday President Obama chose Knox College in Galesburg, Illinois (originally founded by anti-slavery activists in the 1830s) to float the economic program he has been working out with Wall Street investment bankers. His aim is to wrap this program in a democratic rhetoric. The speech’s actual content boils down to: “I’m doing fine and housing prices are recovering. The way to heal the economy faster is to make a Public-Private Partnership (with Wall Street) to finance new infrastructure investment. The government will guarantee a return – and if there’s any loss, we (you taxpayers) will bear it.” His political genius was not to sugar-coat the shady parts of his proposals.

In a Clintonesque manner, he started his speech by saying, essentially, “I feel your pain.” “In the period after World War II,” he started out, “a growing middle class was the engine of our prosperity.” People had a sense that hard work would be rewarded with fair wages and benefits, the chance to buy a home, to save for retirement, and, above all, to hand down a better life for your kids. But over time, that engine began to stall. That bargain began to fray. Technology made some jobs obsolete. Global competition sent others overseas. It became harder for unions to fight for the middle class. Washington doled out bigger tax cuts to the rich and smaller minimum wage increases for the working poor. The link between higher productivity and people’s wages and salaries was severed – the income of the top 1% nearly quadrupled from 1979 to 2007, while the typical family’s barely budged.

All true enough. The idea is that if a President can spell out how unfair the economy is, voters will imagine that he will take the next step and do something about it.

But what is the “it” that needs to be addressed. There is a tendency to blame today’s unemployment and economic stagnation on technology. Last Monday, for instance, Paul Krugman blamed much of Detroit’s problem on changing technology of auto-making. He did not mention unionization’s role – and the decision by carmakers to shift production to non-unionized sites with much lower workerbenefits than the UAW had won over the years. It was as if unionized labor were itself technologically obsolete.

Nor did Obama’s setting the economic stage by focusing on global competition and technology acknowledge the role of debt in raising the price of labor. How can American industry compete when some 40% of the salaries it pays its employees must be paid for housing, 10 percent more for credit-card and other bank debt, 15% for FICA wage withholding for Social Security and Medicare, and 15% more for income tax withholding and for sales taxes? Before employees can start buying the goods and services they produce, they must spend about three-quarters of their income on the Finance, Insurance and Real Estate (FIRE) sector and taxes that havebeen shifted onto their shoulders?

Meanwhile, the companies themselves have been managed by financial officers whose idea of making money has been to debt-leverage, so that more and more cash flow has been used to pay back bondholders and to buy up company stock (thereby increase the value of the stock options that the managers give themselves), instead of to reinvest inexpanding the business at home?

Like any good politician, President Obama recognized that if he tells people that he knows how squeezed they, they will assume that he intends to solve the problem he has just described – not make it worth to reward his backers.

Without mentioning that he had promised to write down the legacy of consumer debt and real estate debt, he hoped to disarm audience resentment by acknowledging that over the past “three decades, a housing bubble, credit cards, and a churning financial sector kept the economy artificially juiced up. But by the time I took office in 2009, the bubble had burst.” So it’s not his fault; he just inherited the problem.

What’s wrong with this picture? He obviously did not expect his students to remember how Democratic Congressman Barney Frank’s got Bush Treasury Secretary Hank Paulson to agree to link the $700 billion TARP subsidy to the banks to a mortgage-debt writedown. Paulson agreed to this, if President-elect Obama would sign on. He didn’t, and the proposal sank.

President Obama also did not expect the Knox College liberal arts students to have read FDIC Chairperson Sheila Bair’s Bull by the Horns or SIGTARP Neil Barofsky’s Bailout to remember how Obama’s Treasury Secretary Tim Geithner disabled any serious plan to write down mortgage debts, by explaining to Barofsky that the Home Affordable Mortgage Program (HAMP) was intended merely to “foam the runway” to slow foreclosures, not prevent them.

President Obama sought to get the debt problem behind him by acknowledging up front that it had cost “millions of Americans their jobs, their homes, and their savings. The decades-long erosion of middle-class security was laid bare for all to see and feel.” Not mentioned was how this “erosion” of security was what had produced the gains of the banks and Wall Street institutions that became his largest political campaign funders.

Now comes the hutzpah, trying to rewrite history while most people are still engulfed in it:

Together, we put in place tough new rules on big banks, and protections that cracked down on the worst practices of mortgage lenders and credit card companies. We changed a tax code too skewed in favor of the wealthiest at the expense of working families, locking in tax cuts for 98% of Americans, and asking those at the top to pay a little more.

The reality, of course, the FICA wage withholding has just increased. And the president has let the crooked mortgage lenders off without prosecuting them, levying only a few pennies on the dollar of fines.

“Add it all up,” he went on, “and over the past 40 months, our businesses have created 7.2 million new jobs. This year, we are off to our strongest private-sector job growth since 1999.” Of course, job growth is not really “strong” when the jobs created are mainly in the service sector paying the minimum wage or barely above it. This is not growth. It is desperation wage trends do not keep with the rising cost of acquiring housing, health care and obtaining an education to get work.

The problem weighing down today’s economy is still the debt overhang. Households are “deleveraging,” that is, spending their income on paying down the debts they have inherited. This is what is stifling market demand, and hence new investment and employment. Obama’s speech seeks to gloss over this problem as if his failure to write down debts is no longer an issue:

Thanks to the grit and resilience of the American people, we’ve cleared away the rubble from the financial crisis and begun to lay a new foundation for stronger, more durable economic growth. In our personal lives, we tightened our belts, shed debt and refocused on the things that really matter.

But “tightened our belts” means paying down debt and thus diverting spending away from goods and services. The debt has not been “shed.” It has been paid out of salaries, reducing what is left to spend on goods and services. When the media try to assure readers and viewers that the economy is on the way to recovery, it is as if the economy can afford to resume growth without writing down the debts that were run up by 2008.

The president acknowledged that “nearly all the income gains of the past ten years have continued to flow to the top 1%.” If he can’t deny it, best to come right out to say it. After all, is this not what he and other politicians have promised their campaign contributors? That’s what politics is all about today: making sure that the gains flow to the top 1%

The problem is, what to do about it. All this description of the problem looks like preparing the ground for what threatens to be the government’s next big giveaway: a Public-Private Partnership, based on privatizing America’s infrastructure.

We’ve got ports that aren’t ready for the new supertankers that will begin passing through the new Panama Canal in two years’ time. We’ve got more than 100,000 bridges that are old enough to qualify for Medicare. Businesses depend on our transportation systems, our power grids, our communications networks – and rebuilding them creates good-paying jobs that can’t be outsourced. And yet, as a share of our economy, we invest less in our infrastructure than we did two decades ago.

The question is, how will infrastructure be financed. The danger that is looming is a giveaway to high finance, such as we have seen in Chicago, where Goldman Sachs and other hedge funds bought the right to install tollbooths on Chicago’s sidewalks with parking meters to squeeze out revenue at the cost of raising the price of driving and transportation in the city.

Most great fortunes in history have been carved out of the public domain. That was the case with America’s colonial land grants, and the railroad land grants after the Civil War. The great question facing Europe as well as America today is whether infrastructure will be provided at a low price – which can best be achieved by public investment – or at a high price as rent-extracting owners turn roads into toll roads, bridges into toll bridges, and so on throughout the economy. This is the looming Wall Street plan, using today’s downturn as an opportunity to cloak a vast new monopoly grab as a “solution” to the economic problem rather than looming as a new threat to price American labor and industry out of global markets.

The same thing is happening in Greece and other Eurozone countries obliged to pay bondholders by selling off infrastructure. In today’s world, privatization means financialization – funding the new construction with debt-financing, building interest and dividend charges into the price of services – and making this revenue tax-free as a result of the tax deductibility of interest.

I think that Obama’s speech yesterday is seeking to “foam the runway” for this plan. One need merely look at what the City of London’s Public-Private Partnership has done to that nation’s transportation system to see a peep into what would be a dysfunctional future for this country. The plan would be for the government to guarantee returns (against cost overruns or losses), passing all losses on to “taxpayers.”

This is essentially what the President proposes to do with mortgages that are still underwater. “I’ve asked Congress to pass a good, bipartisan idea – one that was championed by Mitt Romney’s economic advisor – to give every homeowner the chance to refinance their mortgage and save thousands of dollars a year.” Under this plan the government will absorb the loss – the writedown – that otherwise would be borne by the banks and other mortgage holders. Taxpayers will foot the bill to pay Wall Street. This is the basic model for Obama’s infrastructure plan to be unveiled in the next few weeks.

So what we have in the President’s Knox College speech is an exercise in political stealth. In essence, his message is: “I know how unfair society is. Trust me.” It was what Charles Keating said to his S&L depositors. Iit worked for Bill Clinton. The more clearly a candidate can vocalize peoples’ desires for prosperity, upward mobility and deterrence of wrongdoing, the better they seem likely to legislate a solution. As the famous quip attributed to George Burns, Groucho Marx and others puts it: “The secret of life is sincerity and fair dealing. If you can fake that, you’ve got it made.”

The basic script is fairy tale that balancing the budget in the face of the $13 trillion in Wall Street bailouts requires cutting back spending elsewhere in the economy. The Federal Reserve and Treasury were able to create this money for the banks, but pretend to be unable to do the same for the projected $1 trillion in SocialSecurity deficits that may or may not materialize a generation from now. New wars in Syria and elsewhere can be funded by money creation, but not socialspending programs – to say nothing of financing public infrastructure cost with public money creation rather than by recourse to Wall Street. This is the great policy asymmetry of the Obama Administration’s plans to use the economic crisis as an opportunity to cut and ultimately privatize Social Security as the capstone of a financialized Public-Private Partnership.

Here’s the problem that President Obama did not address yesterday: Today’s debt deflation and economic shrinkage are pushing federal, state and local budgets into deficit. This is forcing public spending to be cut back proportionally. That cutting will push state, local and federal budgets even further into deficit. This is why we are hearing calls to start selling off public infrastructure – to buyers who will become new customers for Wall Street investment banks.

It is the same phenomenon we are seeing in Europe. The newest economic prize is the right to buy rent-extraction rights to turn public roads into toll roads and similar rentier tollbooth installations. All this increases the cost ofliving and doing business, making the economy high-cost even as it is beingimpoverished.

That is not a solution. It bears out the classic principle that the solution to every problem tends to create new, even larger problems. Often these are unforeseen. But today’s problems in the making are all too foreseeable. What is needed is to keep translating the President’s speeches into their subtext.

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About Lambert Strether

Lambert Strether has been blogging, managing online communities, and doing system administration 24/7 since 2003, in Drupal and WordPress. Besides political economy and the political scene, he blogs about rhetoric, software engineering, permaculture, history, literature, local politics, international travel, food, and fixing stuff around the house. The nom de plume “Lambert Strether” comes from Henry James’s The Ambassadors: “Live all you can. It’s a mistake not to.” You can follow him on Twitter at @lambertstrether. http://www.correntewire.com

93 comments

  1. psychohistorian

    The Big Lie technique is alive and prospering under our “talented” leader.

    It is a stroke of genius having a titular representative of our most recent slave “race” be the key tool in our current Shock Doctrine event of class warfare….guess who are losing.

    Orwell didn’t even see that one.

    Into Neo-Orwellian social devolution we march.

    1. MaroonBulldog

      BHO as emblem for the aggressive minority that is plundering our public resources–but it’s not just Orwellian.

      Just as the fasciscts and the Stalinists copied each other’s techniques, so we need the combinded dystopian visions of Aldous Huxlley and George Orwell to guide our understanding of current circumstances. Newspeak is not enough, we must be subjected to soma and feelies, too.

      Newspeak=it’s not just what BHO says, it’s mostly the way he puts it
      Soma= QE/ZIRP is an addictive drug.
      Feelies= the pornographic perversion of the news, infotainment.

  2. vox populi

    Brilliantly stated. It seems likely this private-public partnership will come to pass. When all the rent has been extracted, then, what?

    1. readerOfTeaLeaves

      Before the rent is extracted, we’ll have a collapse of political legitimacy. The act of privatizing public infrastructure will accelerate this problem.

      1. NotTimothyGeithner

        Political legitimacy has already been lost.

        The lack of outrage by the American public over of defense cuts and at Snowden despite widespread bi-partisan agreement about the evils of defense cuts and Snowden. The American people don’t care what our electeds say about national defense.

        Even if it was kabuki, the vote total against the NSA signified they are very worried about their electoral viability, especially Democrats. Republicans are a neo-Confederate rump party, and the majority of the Democrats felt they needed to publicly oppose the President, the leader of their party, on a matter with national-security implications. Has this ever occurred?

        At some point, there will be a Lehman-like event. The division created among non-Republicans by Obama will lead to inaction, and the alliance of Romney-types and Teabaggers won’t survive another bailout. The Teabaggers will demand something they already have which is power over the GOP which means they can’t be appeased into supporting a bailout.

        When 70% of households live pay check to pay check, people who want to be Congressman and the true believers in Congress (there are some) are going to find an audience for an anti-bailout message. Anyone who wants to win state-wide in Congress has to vote against a bailout. They will not save the banks*.

        I don’t think there is a workable majority anymore, or the defense cuts would have been restored, Syria would be the target of a bombing campaign, and so forth. Unlike Bush who was never really popular, I think Obama bought his own press, and I doubt Obama would be capable of honestly explaining the situation in a way that he could present a reasonable path forward. Most of his speeches suffer from cognitive dissonance or are feel good speeches which ignore problems and make governing seem like its supposed to be easy. Even if he understands the problem, I doubt he is capable of moving anything forward because he would have to admit to over 4 years of moral and policy failures.

        *You might say, people fell for it last time. They did, but promises were made. Problems for governments arise after promises are broken. The Democrats elected in 2006 kept all of their promises for the most part. The Democrats elected in 2008 did nothing but protect the wealthy. They lost. The remaining Democrats used fear and had the advantage of Romney to carry them over the line. Promises won’t be tolerated because popular reaction to Snowden’s status as a whistleblower, claims about WMDs in Syria, and the defense cuts has demonstrated the time for promises has past.

        1. nonclassical

          ..read history-total failure of economic system is what has led to reorganization
          in past-everyone must fail, not just “the people” and their representative government-matter of fact Wall $treet non-fail is how we get to corporate facism-selling off publicly provided infrastructure….”Wall $treet-A History”-Geisst:

          http://www.thriftbooks.com/viewdetails.aspx?isbn=0195130863

          $3.99 includes free shipping…

  3. Jim Haygood

    ‘New wars in Syria and elsewhere can be funded by money creation, but not social spending programs … This is the great policy asymmetry.’

    Indeed it is. No Depublicrat ever mentions that the U.S. spends close to 5 percent of GDP on ‘defense’ (translation: global military domination), when 1 percent likely would suffice in its safe neighborhood of North America.

    A bloated U.S. military empire that does not pay its own way represents a sink of malinvestment. Money that should be spent on those Medicare-aged bridges is wasted on occupying Afghanistan and funding Islamic militants in Syria. NATO soldiers on, still ‘protecting’ rich Europe (from what?) 68 years after hostilities ended.

    Today’s U.S. political-economic model is essentially that of the late Soviet Union. We know how that story ends. Doubtless Obama’s leisurely eradication of the middle class will produce a fine crop of American Dmitry Orlovs, documenting this dying empire’s slow fade to black.

    Who would have thought that the star ‘n stripes would replace the hammer and sickle as a symbol of oppression?

    1. Thor's Hammer

      What? You are advocating that the US abandon the one successful technology sector left in the economy? Under Obama our weapons exports have grown from being merely the dominant world supplier to holding a total monopoly position as the supplier of nearly 85% of the world’s weaponry. We lead the world in advanced drone devices and instruments of remote surveillance and assassination. Our cyberwarfare capabilities are unmatched, creating a comparative advantage not just for our military, but for our international corporations and financial organizations by providing them with advance knowledge to front run the competition. Our new Utah data center will cement that superiority, symbolizing the dominance of a truly great world power.

      What would you have us do, revert to ancient times when we were a nation of farmers and manufacturers of outmoded machines like automobiles?

      1. MaroonBulldog

        Yes, and what they’re thinking about next is–how to get all our customers to use those fantastic weapons we sold them, so we can sell them the next generation of replacements and make another fortune?

        Word War III–that’s the ticket. That’s just what the economy needs.

      2. Mark Tea

        The internationalists in our universities facilitate giving away all our technology to the rest of the world. Especially China. I suppose you think that mass executions and organ harvesting are really “efficient”.

        They steal all our technology as fast as it is developed. Now we get their fascist system of “governance”. Anybody who thinks this is good is a fool or a traitor. I’ll bet you are for “comprehensive immigration reform” too. Hey let’s get taken over by the drug cartels!

  4. Schofield

    It’s just got to raise a wry smile Obama masquerading as a minority group baglady whilst in reality being the bagman for the Plutocracy. I’m sure that increasing numbers of Americans are now seeing him for the phoney he really is!

    1. Mark Glomski

      I’m realizing it’s not just Obama, it’s the whole political/economic system. We really need to have our own Arab Spring type demonstrations where we bring the entire country to a halt because everybody is in the street protesting.

      1. Phrase

        Michael Hudson’s article and quote is so appropriate :

        “As the famous quip attributed to George Burns, Groucho Marx and others puts it: “The secret of life is sincerity and fair dealing. If you can fake that, you’ve got it made.”

        As the ‘show’ and celebrity culture continues, Michael Hudson reminds me, that it is important to be continuously aware of the current multi-national corporate agenda. …
        For me, this crony-casino-predatory capitalist ideology, has concentrated the neoliberal agenda’s implementation process, into supra-national institutions, which tirelessly, and on many levels, chips away at national sovereignty and any link between a social contract and the ‘rights’ of civil society. …
        One especially egregious, and to my mind, … arrogant example would be , … the rush-to -the-bottom trade agreements, … bi-or-multi-national types negotiated in secret … (NAFTA, or the latest secretive TPP/CETA) … wherein the corporate-controlled investor-state resolution body’s decisions to impose fines thwarting regional autonomy, … gutting the nation’s ‘public purse’, … and thus, further demonstrating that … principled resistance is futile … because all are meant to see that their sovereign nations, fellow citizens, their communities, their civil society, their culture, … at this point in time have no power to resist the international corporate/financial hegemony. … ( Or, was the EU really planned to succeed, and if so, for whom ? ) … Of course there are powder points which the hegemonic forces attempt to manage in one way or another.
        If the TBTF global financial institutions can’t destroy an independent nation’s economic health by selling the latest financial innovations of mass destruction, which furthers social collapse, … austerity to poverty, … there are always many other means such as sanctions, drones, covert intrusions, … etc., … with seemingly an unending supply of ‘captured-cash’ to cajole the undeserving. …
        For me, civil society clearly realizes how ‘illegitimate’ those publicaly financed economic bank bailouts are,… not to mention other ‘odious’ debt types. … However, i remind myself that those TBTF banks are ideologically challenged global institutions, … who’s job it is to wage economic war in order to maintain hegemony and the status-quo for the ‘ever needy, and always greedy’. … It is inherent to ‘the system’. … And yes, main-stream media will never question the predatory ideology behind the dominant business model. So, it is up to civil society to dig deep to expose the hidden rot, the lies, and the mendacious hypocrisy as Cornel West would say.

        Yes, given the track record, the actions, and directions which the hegemony furthers, … i cannot ’trust’ the intent of centralized power, especially one so unaccountable and supra-national. Let there be no mistake, imperialism has found home in the stratosphere and the various ‘emperors’ are clearly nude. I don’t think that main-stream media can put humpty-dumpty back together again, but the charade continues as skilled orators spin the discredited lines in the sticky web. … Hey, if things get too bad, just go out and consume, … there’s always the credit card. … Really !
        Clearly, i am an anti-globalist at this point. I am anti-crony-controlled, casino capitalism, and the managed non-free market of bloodied invisible hands denying the nature of their crimes against humanity, community, and the human rights of life, liberty, autonomy, equality, dignity, safety, freedom from fear and repression/oppression, and going hungry … etc..
        I believe that the integrity of the nation-state and the eventual ability of a deliberative, democratically, representative authority to clearly articulate the ‘social contract’ for the public good is salient. … At this point, imho, … we need …‘protectionist national policy’ … to resist the momentum of the adolescent neo-liberal ideology; … short-term predatory economic elite solutions sanctioned by the captured influence pedlars, … which gains traction only because those actions are … embedded in fear based hype … , presented as being the only solutions to ameliorate the pain threshold so many experience. … Real leaders would lead by example, do more good, and leave the ‘ratings’ to take care of themselves.
        Main-stream media’s movie creates the illusion that your character, one’s role, is protected, exceptional, even favoured by some ‘god’ ’s blessing, … when really the urban abattoir of todays main-street … includes everyone in the initial stages of the third milenium’s information age’s horror show; … the emperor knows that credibility has been lost, the captured representatives know that their actions clearly allows the public to see that the job of legislatures is to manufacture consent for faux public policies that their destructive immoral ideology needs to be sustained. …
        
So, like many others, i believe that there is tremendous pressure growing in communities and regions, … movements towards becoming locally sustainable. That would surely disrupt the global agribusiness and production models which information technology has enabled. … Again i think of the work and writings of Gar Alperovitz. … Regional pain can create a sense of local community solidarity which can be directed to create different forms of co-ops which empower and restore individual autonomy, dignity, and collective solidarity, … working together with an aim, and on a scale which is legitimate in the eyes of the participants, … because its viably pragmatic, real, and within grasp. …
        Maybe that is why there is such a rush to push large groupings into bankruptcy (Detroit), … to make sure such decentralizing movements remain emaciated. …
        But alas, we know sociopaths seem to flock together in the group-think, thinking toxic carcinogenic thoughts. … The main narrative is careful to avoid mentioning peace, and sustainability, … because such words would recognize higher-orders of thought, … and therefore are goals beyond the skill-set of the ’greedy’, … and therefore the last thing for example, ALEC would push for because that work is not valid in their neo-liberal paradigm and ‘economic’ only lexicon. …
.
To my mind, if we don’t trust the movers and shakers with global economies of scale, let alone national and regional concerns, … what should we do ? …
        I would suggest that ‘support’ for ideologically friendly corporate enterprises is positively motivating. … And the issue of economy of scale may identify that … too large … is just greed on steroids. … America, at one time seemed to love the idea of monopoly, of oligopoly, of celebrity, of spectacle, of escape, …etc.; … maybe now its closer to, many people still support that old life-style consumer heaven, … or, maybe those days are in the rear-view mirror. … We will see ! … But, hanging on to the known, … at a time of the seeing such engineered aggravated assault is traumatic and lethal. … It is stressful to critically analyze, and challenge the status-quo; … difficult to live in that grey-zone, … difficult to juggle diverse perspectives, … especially when we are conditioned to believe there is no choice (TINA), and encouraged to divert attention our attention to jingoistic-mental-candy floss and the marching band ! (How is the music program in publicly funded schools these days ? ) … Oh well !
        To resume, maybe one path to getting there is to clearly recognizing, and articulate, … which multinational corporations and franchises should not be supported … supported because of specific fundamental moral, ethical, environmental, social, and individual reasons. … ( How many B-corps (beneficial corporations) are encouraged in your neighbourhood ? ) …
        Even to articulate and build consensus behind the definition and importance of those fundamental principles is a large task. … Hey, … there are some who will reach for a gun when the thought of a ‘social democratic society’ challenges their ‘comfort zone’. … ? … So it is very important to reclaim co-opted words because their historical lineage provides a culturally rich body of thought from which to paint the new picture. … Therefore, words and ideas need to be reborn to allow an alternative paradigm to be sensed, and envisioned in this image-based culture. … We do have a history, but we need not repeat old mistakes, or allow tyrants to prosper. … We are living in a potentially wonderful yet critically transformative time when robotics, automation, etc., can free the body and mind from the techno-slavery of the surveillance security state.
        I just thought of the ‘Zeitgeist’ movies and of Peter Jacobs, and of numerous others. … They have done such a great job, and provided such a needed service, … in helping us in this ignoble present ‘crisis’, … by revealing the dominant paradigm’s, … nasty, underlying, ideological assumptions, and the resulting troublesome social-cultural-political and economic consequences. … The micro. supports the hierarchical macro. which interacts and further edits the micro. … Things are connected, but life needn’t be spent caught in the spider’s web. …
        Are we actually getting ready to endorse on a mass scale a more horizontally equitable model as the basis for the evolving dominant narrative ? …
        And if such a novel paradigm is taking shape in our ‘collective consciousness’, … if our vision of the future is moving beyond the need or thought of more sophisticated weapons of mass destruction ( psychological, material, financial etc. ), … would not a lot of the toxicity of current ideas, thoughts, and deeds, … atrophy naturally ? …
        I believe that most … ‘folks’ … would like to look back in relief, … in realizing how close we came to the ‘wall’. … There is nothing ‘great’ in this ‘great recession’ ! …
        Hopefully we won’t be remembering how many had to fall, or how much more pain was needed before the adolescent greedy repented in shame. … ! … ( that’ll be The DAY ! )
        I’m not holding my breath. … However birth of the blues, … oh sorry … i mean the NEW … is never easy; … even in the presence of clear, moral, and ethical principles demonstrated by the current and past actions of the metaphorical midwives . … Do you think that those fundamental principles are represented in the group-think represented under the covers of … Obama-care, or Harper-care, or Koch-care, or EU-care, … etc. … ? … ! [… Snowden-cares ! … ? … Michael Hastings cared ! …]
        In any case, and in summation, … and if you are interested, … one of my favourite CDs is Dickey Bett’s “ Pattern Interrupt “ and “ Duane’s Tune “ ! …
        I wonder how, what form, and if, … such a pattern interrupt could work on today’s dominant narrative built to support this current paradigm of infamous debacle and the truly tiny in the midst of such grandiose largess ? …
        … best regards ! … phrase … 07/28/13

    2. Ms G

      “Obama masquerading as a minority group baglady whilst in reality being the bagman for the Plutocracy …”

      Beautiful! FTW!

    3. Mac

      Well ask the folks who voted for Obama in order to prove to themselves that they were not prejudiced just how well that idea is working out.

  5. F. Beard

    Public-private partnerships = fascism. Thus our private money system is fascist since the banks enjoy huge government privileges*.

    Hint: The way out of this mess is to look at a balance sheet and note that Equity and Liabilities are on the same side. They are thus both backed by the Assets. Thus money can be issued either as Liabilities (debt) or as shares in Equity (common stock).

    People often hate the corporations, but without the government-backed banking cartel it is likely that they would be very broadly owned and thus broadly democratic.

    * Government deposit insurance, a legal tender lender of last resort, sovereign borrowing (i.e. the National Debt), lack of a risk-free storage and transaction service for fiat (i.e. a Postal Savings Service, etc.)

    1. Rostale

      An idea I think the american people might support, though never washington, is a variant of privatizing social security, not in the sense of handing money over to the same clowns who wrecked our economy, but making it into either a bank or corporation, whose stockholders are the american people who pay into social security. Then instead of investing your money with TBTF banks, you can put it in the Peoples Bank of Social Security (PBSS). This bank could be seperate from the us government, and be controlled by “investors” in social security in the same way a current corporation is controlled by its stockholders

      Such a bank would be structurally restricted from making risky investments or complicated derivatives, but offer simple straightforward loans. Also this bank could use a portion of its money to invest in companies, preferably finding private regional players, such as Meijers, and buying them outright. the american people would then have the option of spending their money at a business whose profits go to support their own retirement, if successful, the PBSS could use the money gained to gain control of a greater faction of the american economy, not as a government organization, but as a corporation whose revenues are dependent upon the aggregate income of the middle class

      the PBSS controlled companiescould also decide to pay significantly better wages, attracting better employees and acting to drive up wages in general, and invest in american products to be sold in the store. As long as they can keep their prices competitve and mount a good advertising campaign they can pull business awy from companies driving outsourcing. Basically what the goal is, is to give the american people some of the influence upon the national economy that only the likes of goldman sachs currently enjoy.

      corporations can evade high taxation by outsourcing, the rich can shelter their income, the american peoples primary strength, almost more than their vote is where they chose to spend their money. If that can be harnessed, if they can be given an option to spend it in a way that will turn the economy to serve their interests, then they have a chance of standing against the global move to new feudalism

  6. Dave

    The Fed can expand liquidity all it wants but it cannot expand the number of deals. Alan Greenspan said, “You cannot push a string.”. This liquidity will seek a rate of return and will invest in places like Greece or Detroit when no other better opportunities exist even if the interest rate doesn’t reflect their risk. There is an infinite amount of liquidity and a finite number of deals. One purpose of the Public-Private Partnership is to expand the number of investable deals for all the liquidity the Fed has created over the years and allow it to seek a return. Debt is the business of America. You cannot push a string means the Fed can provide all the liquidity in the world but it cannot force people to borrow. If the public at large is deleveraging then the government will take on that role and borrow on their behalf to create ROR opportunities for all this capital and stick the deleveraging public with the bill.

    1. ifthethunderdontgetya™³²®©

      The government is taking all the risk, so why not have it do the infrastructure investments directly, as happened after the Great Depression?

      These “public-private partnerships” are just more vehicles to funnel money to Wall Street.

      We have enough examples already to presume bad faith on the part PPP advocates.
      ~

      1. Dave

        I’m all for infrastructure investments. We should be shrinking the size of the financial services industry not adopting policies to expand it. Financial services is nothing more than a tax and John Bogle was correct in stating the more people “trade” the poorer they become.

        Why structure a deal where the government takes all the downside and private industry takes all the upside? If the deal was such a good deal then it wouldn’t be a Public-Private partnership, it would be called a Private investment. Once “Public” is involved then that means private industry alone could not make the cost benefit analysis numbers work and wouldn’t do the deal. So public taxpayer is called in to move cost off the hands of the private investors of the deal to make the rate of return numbers work for them.

        Since we’re in the business of expanding the money supply to infinity then why doesn’t the government fund the whole thing and take whatever profit there is from the deal for themselves and the American public. Because involving the financial services industry is the only way to get it passed through Congress.

        1. readerOfTeaLeaves

          Yes, the Congress that has about a 9% favorability rating.
          I believe strep and lice are probably more highly regarded at this point.

        2. Ms G

          Thanks Dave. That about sums it up very nicely.
          It is amazing that so many people still don’t get it that “private sector” was at inception and is now a concept fabricated in the service of neo-liberal ideology, one major strand of which is looting by the so-called “private sector actors” (CEOs, Corporations, etc.) of strong financial and asset systems (taxes and government-controlled assets including land, franchises, etc.). “PPP” has always been about individual kleptocrats looting taxpayers and the commons, with all losses for taxpayers and all gains for the looters.

          The looters have always had insiders within government, to ensure that the desired flow of funds (and risk-free terms) continue to inure to the kleptocrats’ benefit.

          Shorter: “Private Sector” is something that does not exist except in ideological “economic” tracts.

  7. Jim in SC

    ‘Most great fortunes in history have been carved out of the public domain. That was the case with America’s colonial land grants, and the railroad land grants after the Civil War.’

    This isn’t really true. I can’t recall reading of any great American fortunes based in colonial land grants. While some of the great fortunes of the post-Civil War era came from railroads, many others, such as Carnegie’s and the Rockefeller’s, came from other industries. The greatest period of wealth creation in history was the 1990s. With the exception of the government’s contributions to basic research, it was a free enterprise operation.

    Some Brits close to George III probably made fortunes from American land grants and slavery–if it hadn’t been for British slave profiteering, there wouldn’t have been an American Revolution or an American Civil War–but most Tories abandoned their property, much of which was confiscated, and returned to England after the Revolution.

    1. F. Beard

      With the exception of the government’s contributions to basic research, it was a free enterprise operation. Jim SC

      1) That’s a HUGE exception.

      2) What part of a government-backed credit cartel sounds like the free market to you? Hmmm?

    2. TK421

      “The greatest period of wealth creation in history was the 1990s. With the exception of the government’s contributions to basic research, it was a free enterprise operation.”

      Are you referring to businesses related to the internet, which was created by the government? Or maybe you’re thinking of software-based fortunes, which can only happen thanks to intellectual property protection provided by the government. Perhaps you’re talking about television and radio channels, using bandwidth that belongs to the people and is licensed out at a (small or large) fee by the government.

      “With the exception of basic research”. Yes, when the government invents a new drug and someone else sells it for a vast fortune, they are the ones who did the hard work. Inventing high-demand products is easy!

      1. Crystal

        The 90s were a time of accelerating inequality. Ironically a result of the orgy of “cashing in” is that the US lead in technology is precarious. Worldcom, Enron and neo-change. What a decade.

    3. readerOfTeaLeaves

      Out West, the railroads received vast grants of valuable land, much of it with timber. There were also individuals who claimed forest tracts, and four generations later, their descendants still have solid Trust Funds. And those are only two examples.

    4. Robert Hurst

      Countless fortunes were made on the basis of the massive land giveaways of the 1860s, the Homestead Act and subsequent timber claims law.

      Nothing like a few hundred acres of free land to really get you started on the right track.

    5. nonclassical

      ..when you read history of “Teapot Dome Scandal”, you didn’t realize you were reading Fred Koch (primary instigator of John Birch Society-revamped as “Project For A New American Century” neocons, and Koch Bros.) historical-leading to scamming of oil rich lands in west and firing of two elected representatives, did you??

  8. Jackrabbit

    How do people resist this policy?

    How can groups that are opposed to public-private partnerships communicate their objections effectively?

    Just like with fracking, tobacco, and other systemic issues:
    1) organized opposition is two steps behind
    2) The promise of jobs is used to undermine any opposition
    3) It is difficult to communicate systemic concerns in a way that gets ordinary people to participate. People react to concrete problems not to amorphous concerns.

  9. km4

    You shoot $85 billion worth of heroin every month as your health fails and you don’t get that high anymore. Clearly, you need to shoot more heroin.

    YouTube – The Pusher http://www.youtube.com/watch?v=rpoEmlxUPeQ

    I said Goddamn Goddamn the pusher man……The Ben Bernank doing heckuva job for Obama Hopium

  10. Mark Glomski

    “A better life for their kids”??? I keep hearing that over and over. Better than what? I could understand if all you ever had to eat was Turnips and you walked barefoot because there was no money for food. Then yes, you want a better life for your kids. And there are some poor people in the United States. But for a lot of Americans, even if they only make 1/2 as much as their parents they have nothing to complain about. The main problem is (and has always been for 1500 years) the high cost of rent. Landlords cause more pain and suffering than tobacco companies ever could.

    1. Jim in SC

      Response to Mark Glomski:

      What’s ironic is that landlords–at least of the single family home variety–are not making any money, and haven’t for a long time. Dramatic rises in property taxes in our state have squeezed the landlords’ profitability to nothing. In the long run, people will stop providing property to rent, and that will create a bigger problem than we can envision now.

      No one is interested in addressing the regulatory overkill that makes real estate twice as expensive as it should be. Why? Because it is the middle classes ox that would get gored. Bad politics.

      1. Crystal

        Regulatory overkill in real estate? Surely you must be smoking something. Great place to launder moolah. Obviously, the bitching sounds from landlords on rental properties depends on scale and size. Since taxes aren’t an issue to the bigger landlords that don’t pay them. Homesteaders have a bigger expense to worry about presumably if they purchased in the past 15 years. I don’t know why the hicks/gentry refuse to rail against the big corporations and government contractors (that inhale your tax dollars for their so-called efficency in running Government functions) – and pay jack squat on their corporate campuses, water bills or even pay their employees – since that too is covered by the Gum’mint.

      2. nonclassical

        …Jim obviously cannot “follow the $$$$” to economic destruction of U.S. $6.5 trillion per year economy, for over 6 years on the way to what Gore Vidal defined as 20….never to be “same” again…

    2. Flying Kiwi

      A better life for your kids isn’t just about cheaper bread and bigger home than you had. It’s about their having access to the lessons your learned in your life as well as the thoughts of every thinker from Babylon onwards, and the tools to use those lessons and that thinking to build a fairer, safer and more secure society as well as a better world for themselves.

      In that regard the baby-boom generation has failed.

    3. Yves Smith

      I don’t know how old you are, but the only way for boomers to have assured a better life for their kids was for most of them not to have kids at all. A lot of what we are seeing now is the result of fighting over constrained resource pies. OMG, economic growth might have had to rely solely on productivity growth! How terrible! But we’d have had a better shot at a functioning society. Look at how well Japan has handled its joint demographic and economic train wreck. They still come out tops of all advance nations on social indicators.

      So be careful for what you would have wished for.

  11. Michael Fiorillo

    In addition to seeking to privatize the nation’s transportation infrastructure, Obama is also the chief enabler of the smash and grab effort to destroy local home rule and privatize public education.

    Take a look at Chicago, where his former chief of staff is closing public schools, laying off unionized staff, and opening charter schools staffed by Teach For America scabs.

    As others have said before, it was nefarious brilliance that led the Overclass to put putative Black man in the position of administering the demise of the New Deal and Great Society.

    1. F. Beard

      O didn’t fool me. But I knew libs and Progressives would lap it up.

      A man who won’t believe in God will believe in anything. C.K. Chesterton

      (Not that I believe much that is extra-Biblical, especially from a Catholic, but the above seems consistent with Scripture, the source of wisdom.)

      1. MaroonBulldog

        “Now faith is the assurance of things hoped for, the conviction of things not seen.” Hebrews, 11.1.

        BHO sells faith. Misguided and betrayed faith. Whom are you going to believe? Him? Or your own (lying) eyes?

        1. F. Beard

          I remember when “Obama” and “Messiah” were uttered in the same breath. Really, people are that ignorant of the Second Coming.

          That could turn out to be VERY expensive ignorance.

      2. Jimbo

        IOW, swallow Biblical BS and you’ll be less hungry for other BS.

        I’m an agnostic, and teh O didn’t fool me either.

        1. F. Beard

          Will the big O be remembered 1900 years from now? Yet the Bible remains the greatest bestseller of all times.

          1. nonclassical

            FB,

            far more ancient wisdom: “Use the applicable tool for the job…the tool of life should be utilized to adjust the job of life…it is not applicable to the job of death…”

          2. accidentalfission

            @ F. Beard,

            You can choose to beleive anything you want. That doesn’t make it true.

            Evidence-based thinking has a better chance of revealing solutions to the problems of climate change, resource depletion, and over population than religious scriptures whose true provenance is lost in mists of time.

            As Albert Eistein said, “We cannot solve our problems with the same thinking we used when we created them.”

            1. F. Beard

              You can choose to beleive anything you want accidentalfission

              That’s not always true which is why those who want to believe but can’t should start reading Scripture as soon as they can because it might take years to see that it all makes sense.

              Literally, when I first started reading Scripture, I would stumble over nearly every other word but it got easier over time.

              And btw, some of the greatest scientists in history have been devout Christians too. So why do we stand on their shoulders yet piss down their backs? (Pardon my French!)

    2. Arthur Wilke

      In a recent issue of The Nation (http://www.thenation.com/article/175085/chicago-rising) there’s an encouraging report on organized resistance in Chicago by a coalition of community groups including a now mobile Occupy contingent and investigations into a challenging terrain, various often obscure financial records of the City of Chicago’s operations.

  12. TK421

    “I’ve asked Congress to pass a good, bipartisan idea – one that was championed by Mitt Romney’s economic advisor”

    I love it! All the people who said last year that we absolutely must reelect Obama because, whatever bad things he may have done, Romney was just too horrible to let have power will now have to swallow a Romney plan as one of Obama’s major second term initiatives. That puts a smile on my face.

    1. Jimbo

      Shorter O: ” I no y’all voted for me, but ya got Mitt anyhow. Sux TBU, haw haw haw.”

  13. Frances Morey

    Here is a snippet of conversation between me and a Parisian woman my age about an hour ago:

    By me:
    …”Nixon was the beginning of the end. I hate to think that we have a Good Party and an Evil Party since the Good Party isn’t all that good.

    From Her:
    Democracy will emerge when people will see parties are not the answer : democracy by drawing of lots and people writting the constitution is adviced by some french sercher as it worked very well in athens in the past : congressmen just all signed a law to forbid demonstrations :in cases of occupying ! this is what this french man says : it is not to congressmen to write the laws they want but to the people ! ( Etienne Chouard )” [forgive the (sic)’s]

    The essences of the French Revolution are more hopeful than our own legacy of the Civil War, lamenting the loss of slave labor and the freedom to lynch.

  14. Walter Map

    One wonders how Romney would have been any better. Or any worse. Or, indeed, any different.

    The problem with politics in Amerika is that you get the same result regardless of who you vote for, or whether anybody votes at all. That’s how it was in the Soviet Union. And it’s hardly accidental.

    Is DC officialdom still claiming the U.S. is a “free country”, or do they figure they’ve already trashed their credibility sufficiently for now? Too bad for them. Now they’re going to need to come up with a new canard.

  15. Paul Handover

    Dear Michael Hudson, What a fascinating and educational essay! (Apologies in advance for this rather wordy comment from me.)

    The reason why I found the essay so interesting is that I am a recent immigrant to this fine country, in that I am a Brit living in Southern Oregon with my British wife, who is a US Citizen as well. I was admitted to the US under a fiance visa in October 2010, married and settled down in Payson, AZ before moving up to the Grants Pass area of Oregon just 9 months ago.

    More relevant background to this comment (did I see you stifle a yawn!) is that during the period 1979 – 1986 I came to the US on business frequently; I had two US distributors, East Coast and West Coast, and my ex-West Coast distributor has been a close friend for over 30 years.

    Therefore, I think that I have a perspective on both the UK and the USA over these years. Which can be neatly summarised as an increasing burden of Government on its peoples.

    Now don’t get me wrong, I’m not a raving extremist of either political wing! Just a guy born in 1944 who had the fortune to be able to work hard building a business, which was sold in 1986. Ergo, I am not typical of the millions of decent, hard-working men and women who work right up to their day of retirement, and often beyond.

    So the over-riding impression of the last 30 years is one of increasing costs of living, on both sides of the Atlantic, increasing bureaucracy and increasing inequalities.

    But there is one other impression from recent years that worries me greatly; again on both sides of the ‘pond’.

    It is the increasing dishonesty of governments. It was this aspect of Michael Hudson’s essay that really smacked me in the face.

    We have two gigantic social problems that are being almost completely ignored by the US and UK governments.

    One is the level of economic hardship that one sees all around. It’s scary: scary bigtime. In the other article in today’s Naked Capitalism, Lambert Strether wrote (of China): “One of the most reliable indications that things are not well in an economy or a society is a rise in street trading and increased harshness in enforcing the rules that control it. When people can’t find proper jobs or can’t stand the ones that are available, they go to the streets with a barrow-load of vegetables, a swatch of scarves or a tray of cheap plastic toys. Sometimes they have licences; often they do not.”

    Who else has noticed the only ‘retail’ growth is the rise of Thrift Stores and the explosion in yard sales?

    Who else of my age sees clearly that the days of a family being able to live comfortably and happily with the father out at work and the mother at home able to bring up the children are long, long gone?

    The second is that in the past, we have had economic hardships purely as a result of social consequences. Now we have on top of the present economic challenges, a planet that is close, if not already past, a climate tipping point.

    As was written over on the Patrice Ayme blog, “Methane belching could create an incommensurable planetary emergency tomorrow. Or in a century. We don’t know. I find telling that Total SA and major companies in Russia, Japan, China are betting dozens of billions of euros that the warming of the arctic will accelerate significantly within a couple of years.”

    But no, governments continue to promote “growth”. Not a hint of any openness and honesty from our leaders that there is, at a minimum, cause for concern! No sense that we could be on the verge of an utter collapse of civilised society.

    Any obvious solutions? No! Not at least until we have some political leadership that sees integrity as the over-riding value of government.

    I will close by quoting the last paragraph from a post published today by an English blogger, Alex Jones, because his words say it all!

    “Conclusion

    The State must act always according to its nature and purpose, to benefit all equally and never to advantage one at the disadvantage of another, to do so results in the negative outcomes as seen today in Syria. The State is part of nature, thus bound by the same natural laws as any bee or flower. It is good action to match human laws to the purpose and nature of the State, and to the overall natural order, thus the State enjoys prosperity rather than what befell the Roman Empire when it ignored the spiritual wisdom of its own religion.” (Link: http://liberatedway.com/2013/07/28/society-3-the-state-and-you )

    1. nonclassical

      …all of which goes to show U.S. and British Imperialism connected at the brain..

      …meanwhile, continentals know Britain is not part of Europe…

      ..tellingly you got through your diaspora without mention of “City Of London” financial center, or Adam Curtis’ Mayfield series on British economic-military-financials…

  16. tiresoup

    The oracle of Obama: whatever he says, his actions usually take place nearly 180 degrees in the other direction. This angle of deceit, while shared by all politicians, does seem unusually large his case.

    Obama (or any politician) is what he does, not what he says – although you CAN fool some of the people all of the time. Is that who he’s reaching with this “I feel your pain” claptrap? I can’t believe that even he believes what he’s saying.

    As for what his plans are: enriching the financial and corporate oligarchs at the expense of the taxpayer would just be more of what he’s been doing since he first got elected. Fancy words to the contrary are evidence that he either thinks fancy words will still work, or are otherwise still necessary.

  17. Kim Kaufman

    I sent this article around this morning to some friends and even my Outlook spell-check questioned “hutzpah” for “chutzpah.” :(

    Obama has been thumping this private-public partnership since perhaps his second year in office. Have you broken this down, Yves? Has anyone? Has anyone recently? I know I saw some good stuff a couple of years ago. I’d like to see some pushback on this hustle quickly.

    1. Hugh

      The federal government through its fiat currency can pay for whatever it wants. That is it can use its power to create money to direct, not create, resources to projects in the public interest. It can send money to both state and local authorities to do this as well. It can balance out any potential conflicting calls on resources by taxing the rich far more heavily. Obamatalk focuses mainly on infrastructure projects and “growing” the economy, but in fact this redistribution of resources could be used in other ways as well. It could be used, for instance, to create a right to a real, meaningful job paying a living wage. As Susan the other I believe has pointed out numerous times, there is a crying need in this country for people to engage in activities that are not very productive (in the sense currently used) but of high social utility, like raising and educating our kids and taking care of our elderly. Such jobs would not “grow” the economy except in terms of the increased demand these income could supply, but they would make our country a better place to live and improve our lives.

      That is what could be done. But because we live in a kleptocracy, it is not what will be done. Instead we are told that there is very little money, except for tax cuts for the rich, imperial wars, and handouts/bailouts to our criminal banking sector. Public/private partnerships are another scam which grows out of the lie of scarce money. They give the rich and the corps (which are essentially the same thing) a cut of the action of what should be government only activities. They are another way of selling off the commons. Moreover, in a lot of these scams, government assumes most of the risk and the profits (and for the private side, there must be profits, and higher prices to pay for them) go mostly to the private side. Public/private partnerships are, in other words, just another kind of looting.

      1. Kim Kaufman

        Like non-boiled bagels sold in pre-wrapped plastic bags in supermarkets (at least in Los Angeles) which I call Christian bagels – and no offense to Christians or bagels anywhere – this spelling is, to me, Christian Yiddish. I just think it’s funny, in an eye-rolling sort of way. Not quite as ridiculous as Michelle Bachman
        http://www.salon.com/2011/07/14/bachmann_yiddish_chutzpah/
        “Michele Bachmann has long positioned herself as a staunch supporter of Israel and the pro-Israel lobby. Despite this, Bachmann has not brushed up on her Yiddish. On Fox News last night, the Minnesota Republican pronounced the word “chutzpah” — Yiddish for “audacity” — as “choot-spa” (something she was accusing Obama of having).”

  18. Mac

    Do all of the folks who read and post fail to understand that Obama has no ideas he reads speeches putting out ideas his gang has cooked up. He is truly an empty suit. His purpose in life is self aggrandizement and accumulation of wealth and glory with little or no effort.

  19. Android 16

    A brand “saviour”, “messiah” to distract the proletariate (those who are to procreate for surplus labor). Logocide, euphemism, hyperoptimism, short-termism, quality devolution, form evolution, consequences of accelerating debt financing, maximization, optimization, exponential growth insanity, epistemological deceit….rent extraction. Integrity deconstruction/reconstruction to act out a form, an as if, a brand, a manufactured notion, impression…through psychology they deconstruct the symptoms of integrity and trust and reconstruct them in self help books to act out the symbols, but this is just a hollow theathre, empty symbols, signs, music, etc…vomit wrapped in gold

    1. Android 16

      White teeth, no hair out of place, symmetry, sexuality, perfect tailoring and body language. Colonize the minds, deliver the masses …

  20. km4

    80% Of US Adults Are Near Poverty, Rely On Welfare, Or Are Unemployed | Zero Hedge http://www.zerohedge.com/news/2013-07-28/80-us-adults-are-near-poverty-rely-welfare-or-are-unemployed

    EXCLUSIVE: SIGNS OF DECLINING ECONOMIC SECURITY
    http://bigstory.ap.org/article/exclusive-4-5-us-face-near-poverty-no-work-0

    WASHINGTON (AP) — Four out of 5 U.S. adults struggle with joblessness, near poverty or reliance on welfare for at least parts of their lives, a sign of deteriorating economic security and an elusive American dream.

    The gauge defines “economic insecurity” as experiencing unemployment at some point in their working lives, or a year or more of reliance on government aid such as food stamps or income below 150 percent of the poverty line. Measured across all races, the risk of economic insecurity rises to 79 percent.

    Going back to the 1980s, never have whites been so pessimistic about their futures, according to the General Social Survey, which is conducted by NORC at the University of Chicago. Just 45 percent say their family will have a good chance of improving their economic position based on the way things are in America.

    1. Soup Nuts

      What do they call the American Dream? WW-2 era semi ballon framed homes, lead paint, asbestos that somehow was worth .5 million dollars in 2005? That’s called American insanity. Housing is only for people who are “responsible”, just like freedom according to the Beltway. I don’t know who wrote his blathering delusions, most likely a team effort. But it sounds like the stuff Jon Favreau and Cody Keenan have hatched, aside from the glorification of militarism. Impeach!

  21. Kim Kaufman

    @ Mac – I agree with you. A friend recently went to a high-priced fundraiser for Alan Grayson. Grayson told the crowd that all Obama wants is… to be president. He has no ideas, no plans.

    1. ex-PFC Chuck

      “… one day you will come to a fork in the road…. And you’re going to have to make a decision about which direction you want to go…. If you go that way you can be somebody. You will have to make compromises and you will have to turn your back on your friends. But you will be a member of the club and you will get promoted and you will get good assignments…. Or you go that [the other] way and you can do something – something for your country and for your Air Force and for yourself. If you decide you want to do something, you may not get promoted and you may not get the good assignments and you certainly will not be a favorite of your superiors. But you won’t have to compromise yourself. You will be true to your friends and to yourself. And your work might make a difference…. To be somebody or to do something. In life there is often a roll call. That’s when you will have to make a decision. To be or to do? Which way will you go?”

      From Boyd: The Fighter Pilot Who Changed the Art of War by Robert Coram. (http://amzn.to/sQX5Tk)
      The late USAF Col. John Boyd was America’s foremost 20th Century military reformer and strategist. The quotation above is a typical pitch he made to promising young officers and civil servants to join him in working to reform from the inside a system by which they had not yet been corrupted. Boyd’s strategic ideas are regarded by many around the world as equal in significance to those of Sun Tzu and Clausiwitz. Nearly four decades after his retirement from uniformed service and sixteen years since his passing, his name is still radioactive in much of the military, especially in his home service.

      1. ex-PFC Chuck

        To be candid, I think it’s an open question as to whether Obama just wants to be someone, namely president. It’s scary to consider that he may well have sought the office to do something for unstated reasons. Maybe the Tea Partiers aren’t so far out in left (or rather right) field after all.

  22. Montanamaven.

    I just heard MATTHEW Rothschild , editor of “The Progressive ” magazine, say on Sirius radio’s “Left Jab ” radio show that he loved the speech . It’s the Obama that he believed in in 2008. He was so excited to hear him talk about inequality. Let me repeat this is the editor of “The Progressive”. Huh? Does he really believe this? I have to admit that i bought into the whole progressive spiel. i took “the Nation” cruise in 2004. i sang Broadway songs with Molly Ivens. but even then i smelled something a little foul. Glad I cancelled my subscription in 2008 when my reason kicked in.

    1. Ms G

      The key here is that this guy was “Excited to *hear*” OBH. The Messiah loved for his words, whatever his actions may be. That this deluded little man could say a thing like this 5 years into the Great Deception is proof positive that Obama successfully pushed Hopium on “progressives” and has reduced them to … braindead hopium addicts.

      Nice work, OBH.

  23. DeMarco Reduction

    ‘A loan that can’t be paid back, won’t be’. Why is it any surprise that borrowers are redefaulting after they’ve been HAMP-ed? There was never any interest in helping people, none at all.

  24. Teejay

    “… Goldman Sachs and other hedge funds bought the right to install tollbooths on Chicago’s sidewalks…”

    Toll booths on sidewalks? Literally? Professor Hudson can
    you elaborate on this?

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