Why Does No One Speak of America’s Oligarchs?

One of the striking elements of the demonization of Cyprus was how it was depicted as a willing tool of Russian money launderers and oligarchs. Never mind the fact, as we pointed out, that Cyprus is not a tax haven but a low-tax jurisdiction, and in stark contrast with the Caymans and Malta, has double-taxation treaties signed with 46 nations and has (now more likely had) with six more being ratified. Nor is it much of a tax secrecy jurisdiction, according to the Financial Secrecy Index. Confusingly, in the overall ranking, lower numbers are worse (Switzerland as number 1 is the baaadest) but in the secrecy score used to derive the rankings, higher is worse, with 100 being utterly opaque. The total rank is a function of “badness” (secrecy score) and weight (amount of business done). You’ll notice that all the countries ranked as worse than Cyprus have secrecy scores more unfavorable than it, with the exception of Germany, which is a mere 1 point out of 100 less bad, and the UK, which scores considerably lower (Nicholas Shaxson, author of Treasure Islands, would take issue with that reading, but he takes a more inclusive view of the boundaries of a financial services industry. For the UK, thus he not only includes the “state within a state” of the City of London, but also the UK’s secrecy jurisdictions, such as the Isle of Man, in his dim view of the UK as well as the US on secrecy). And even so, its greater volume of hidden activity gives it a much worse overall ranking. Of countries 21 tp 30, only 3 rank as less bad on secrecy: Canada, India, and South Korea.

And as far as how many oligarchs have deposits there, even the New York Times, in a story framed around a lawyer who sets up shell companies for Russian investors, mentions in passing at the end:

Any dirty money flowing through Cyprus, however, is dwarfed by funds generated by legitimate businesses looking for easy and legal ways to avoid taxes. There are so many Russian companies registered in Cyprus for tax reasons that the tiny country now ranks as Russia’s biggest source of direct foreign investment, most of it from Russian nationals through vehicles registered in Cyprus.

And the oligarchs with meaningful involvement in Cyprus? The New York Times did find one, but he seems to be the exception rather than the rule. From Cyprus Mail:

“You must be out of your mind!” snapped tycoon Igor Zyuzin, main owner of New York-listed coal-to-steel group Mechel , as he dismissed a suggestion this week that the financial meltdown in Cyprus posed a risk to his interests.

His response is typical across the oligarch class of major corporations and super-rich individuals, reflecting the assessment of officials and bankers on the Mediterranean island who say the bulk of the billions of euros of Russian money in Cyprus comes from smaller firms and middle-class savers…

Sources in the wealth management, advisory and banking industry in Nicosia say Russia depositors are typically smaller savers and entrepreneurs. Fiona Mullen, a British economist in Cyprus, said Russians she encounters tend to be buying 300,000-euro homes, not the palaces favoured by oligarchs in London.

Now notice how much space I’ve devoted to showing that major parts of the conventional narrative about Cyprus are not all that they are cracked up to be. But see another implicit part of the story: that Russia’s oligarchs and “dirty money” are a distinctive national creation. Do you ever hear Carlos Slim or Rupert Murdoch or the Koch Brothers described as oligarchs? To dial the clock back a bit, how about Harold Geneen of ITT, which was widely known to conduct assassinations in Latin America if it couldn’t get its way by less thuggish means? (This is not mere rumor, I’ve had it confirmed by a former ITT executive).

The one way in which the Russians top rich do occupy a distinctive place is in the role that violence often played in their ascent. But violence is also a common feature in what reader Scott called the Land of the Dash Cam. Nevertheless, one of my colleagues who opened the Moscow office for Dun & Bradstreet and got it profitable in a year and a half bragged that she was probably the only person who sued a Russian oil company, won the case, collected the judgment, and lived to tell the tale, She also had an ex KGB officer as driver who filled her in on the finer points of murder, Russian style (for instance, to really cover your tracks, you need three people: A kills the person you want dead, B kills A, and C kills B. Type A is pretty cheap to hire, but finding the person for the B role is the expensive item, since he has to be skilled enough to kill a low level killer. Of course, C is not cheap either).

Nevertheless, Simon Johnson clearly described in his important 2009 Atlantic article, The Quiet Coup, that American was in the hands of oligarchs:

Every crisis is different, of course….But I must tell you, to IMF officials, all of these crises looked depressingly similar….Typically, these countries are in a desperate economic situation for one simple reason—the powerful elites within them overreached in good times and took too many risks. Emerging-market governments and their private-sector allies commonly form a tight-knit—and, most of the time, genteel—oligarchy, running the country rather like a profit-seeking company in which they are the controlling shareholders. When a country like Indonesia or South Korea or Russia grows, so do the ambitions of its captains of industry. As masters of their mini-universe, these people make some investments that clearly benefit the broader economy, but they also start making bigger and riskier bets. They reckon—correctly, in most cases—that their political connections will allow them to push onto the government any substantial problems that arise…

In its depth and suddenness, the U.S. economic and financial crisis is shockingly reminiscent of moments we have recently seen in emerging markets (and only in emerging markets): South Korea (1997), Malaysia (1998), Russia and Argentina (time and again)….But there’s a deeper and more disturbing similarity: elite business interests—financiers, in the case of the U.S.—played a central role in creating the crisis, making ever-larger gambles, with the implicit backing of the government, until the inevitable collapse. More alarming, they are now using their influence to prevent precisely the sorts of reforms that are needed, and fast, to pull the economy out of its nosedive. The government seems helpless, or unwilling, to act against them.

Now Johnson carefully laid the bread crumbs, but so as not to violate the rules of power player discourse, pointedly switched from the banana republic term “oligarch” to the more genteel and encompassing label “elites” when talking about the US (“elites” goes beyond the controlling interests themselves to include their operatives as well as any independent opinion influencers). Yet despite his depiction of extensive parallels between the role played by oligarchs in emerging economies and the overwhelming influence of the financial elite in the US, there’s been a peculiar sanctimonious reluctance to apply the word oligarch to the members of America’s ruling class. Some of that is that we Americans idolize our rich, and the richer the better. No one looks too hard at the fact many of our billionaires started out with a leg up, parlaying a moderate family fortune (for instance, in the case of Donald Trump) into a bigger one, or having one’s success depend on other forms of family help (Bill Gates’ mother having the connection to an IBM executive that enabled Gates to license MS-DOS to them).

But the fact that some people have advantages and are able to make the most of them, isn’t the reason to pin the “o” word on America’s top wealthy. It’s that, like Simon’s prototypical emerging market magnates, they increasingly dominate our society and are running it strictly for own self interest and devil take the rest of us. And the results on important metrics are worse than in Russia. The Gini coefficient is a widely-used measure of income inequality. The Gini coefficient is worse (higher) for the US than for Russia. Even though its rich have gotten richer and have pulled away from their lessers, the rest of the population has also done better:

In dollar terms, Russia’s GDP increased 7.5-fold over the last decade from around $200bn to $1.5 trillion; at the same time, nominal average wages increased 14-fold over the same period from $50 to around $700 a month.

And the latest statistics on the Gini coefficients (at least readily findable on the Web) are a few years stale. As we’ve written, the income gains in the US from 2009 to 2011 went entirely to the top 1%, which saw a 121% increase; the rest of the population suffered a small decline. That would increase the US Gini coefficient even further.

And on top of that, the cash hoarding habits of both poor and rich Russians, and the comparative difficulty that low and moderate Americans have in escaping the strong grip of the IRS may mean the Russian wealth inequality is lower than official figures indicate. The Telegraph again:

“The proportion of mattress-stuffed money among Russia’s poor is much higher than among America’s poor, as the US tax net is so much tighter,” says Liam Halligan, chief economist at Prosperity Capital Management. “That suggests US inequality is even worse relative to Russia than the numbers suggest.”

Now many readers may still recoil at the oligarch label being applied to America’s top wealthy, or Russians being much better at trickle-down economics that the plutocrats here who keep selling it despite overwhelming evidence that it isn’t operative here. But what about the celebrated John Paulson, who became a billionaire by not simply betting agains the housing market, but as we described in ECONNED, using CDOs that had the effect of pumping the bubble up bigger? Or the principals of Magnetar, whose CDO strategy played an even more direct role in extending the toxic phase of subprime lending beyond its sell by date? How about the Walton family, whose company is a welfare queen, with employees who depend on Medicare and emergency rooms for health care?

Some of the oligarch image is blunted here by the fact that the most visible members of the 1% and 0.1% are CEOs, who are increasingly chosen for their credibility with media. Their polished veneer and (in almost all cases) conventional credentials would seem to set them apart from the prototypical bad American plutocrat, the robber baron. After all, these are Peter Druckerized pinnacles of the managerial class, there by virtue of merit.

Anyone who has been inside Corporate America will tell you that merit is at most only one component in who gets ahead. As we pointed out in 2007:

Moreover, performance appraisal systems, which are the foundation for bonuses and other merit based pay, are hopelessly and intrinsically flawed. Carnegie Mellon professors Patrick D. Larkey and Jonathan P. Caulkins’ 1992 paper “All Above Average and Other Unintended Consequences of Performance Evaluation Systems,” discuss how, despite 100 years of effort, performance appraisal systems fail to achieve their intended results due to romanticized notions about how organizations work and difficulties in making comparative rankings of workers engaged in different tasks. For example, the article discussed the many ways a boss’s motivations and quirks could lead to misleading ratings.

Caulkins and Larkey’s analysis showed that the idea that organizations are or can be meritocracies is a myth. Yet people have a powerful need to believe that society and the institutions they belong to are fair. These factors explain not only why increasing income

Top executives have operated in a manner that is less obviously thuggish than the violent ways of some of Russia’s richest, but the hollowing out of labor and shortened job tenures have come with high costs across broad swathes of society. And the oligarchs that Johnson singled out, the elite that control the biggest financial firms, have become singularly, systematically predatory. We discussed long from in ECONNED the scale and nature of the looting that produced the global financial crisis.

And let us not forget that people are dying thanks to bank-related abuses, even though it’s not as direct or obvious as by assassinations. On the mortgage front alone, we’ve discussed for three years how many foreclosures are simply unwarranted, some created by servicers for their own profit, many of the others unjustified because it would have been better for everyone, the borrower, the mortgage investors, the broader community, for the borrower to get a modification, but the servicer put its own bottom line first and foreclosed. There have been cases of suicides on the eve of foreclosures, and even a courtroom death that was attributed to the stress of fighting a dubious foreclosure. But in addition to these clear cases of death by bank, there are many more cases where the financial distress of a foreclosure leads to a later suicide, or the curtailment of spending on health measures that shorten lifespans. The major servicers have blood on their hands as much, likely much more, than the demonized Russian oligarchs, but everyone here is too polite to say so out loud.

Confucius said that the beginning of wisdom was learning to call things by their proper names. The time is long past to kid ourselves about the nature of the ruling class in America and start describing it accurately, as an oligarchy.

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  1. vlade

    “You’ll notice that all the countries ranked as worse than Cyprus have secrecy scores more unfavorable than it”. UK has quite secrecy opacity score (45 vs. Cyprus’ 58)

    1. Yves Smith Post author

      aiee, I was racing to get this completed by the 7:00 email cutoff (had about a 2 hour Internet outage overnight, which really screwed things up) and clearly managed to read past that #. Have corrected the post. Thanks for the catch.

  2. Skeptic

    Thanks very much for the item on Oligarchs and Language.

    “Confucius said that the beginning of wisdom was learning to call things by their proper names. The time is long past to kid ourselves about the nature of the ruling class in America and start describing it accurately, as an oligarchy.”

    I have great respect for you and many others in the Alternative/Contrarian Camp. But many there use the Language of the Elite when they should “call things by their proper names.”.

    Victor Klemperer was a Professor of Philology under the NAZIS and survived them. He wrote diaries of the experience which he had to hide at great risk to himself. These diaries describe how the NAZIS used and controlled Language and the public discourse.

    There are many glaring contemporary examples of this use of Elite Script rather then Real Script.

    For example, it is the War Racket not the Defense Department. So described by Marine Corps General Smedley Butler who won two Congressional Medals of Honor. He wrote a book about it.

    Another stark example is Food. Most of what America eats is not food but rearranged Industrial Molecules. Just like the TBTF Banks have destroyed an honest, reliable Financial System, the major players in AGRIBIZ have destroyed real food and replaced it with processed matter. So, please, let’s not call Kraft Dinner, Tostitos, MacCrap, etc. food.
    And Food Stamps are really AGRIBIZ Subsidies.

    It’s not Healthcare either but something else.

    You cannot speak Truth To Power unless you have a truthful language.

      1. Bev

        Yes. Further, instead of “conspiracy theorist” being the accepted pejorative to dismiss people who are trying to understand/relay truth, the phrase must be redirected back at the people using this technique by saying that if proven true, then they are holding up their end (by shutting down inquiry, investigation) to be complicit in a “criminal conspiracy.” They say “conspiracy theorist”; you say “accomplice in a criminal conspiracy.”

        See examples:


        AA Exposes Bush’s ‘Big Lie’: Flight 11 DID NOT FLY on 911!
        by Len Hart, The Existentialist Cowboy

        American Airlines is the source for information that AA Flights 11 (North Tower) and 77 (Pentagon) did not fly on 911. If neither flew on 911, the Bush ‘theory’ is a lie. If the Bush ‘theory’ is a lie, there remains only one explanation and that is: 911 was an inside job given a green-light by Bush himself.



        RFK children don’t believe that Oswald acted alone

        RFK children speak about assassination in Dallas

        updated 1/12/2013 1:57:58 AM ET

        DALLAS — Robert F. Kennedy Jr. is convinced that a lone gunman wasn’t solely responsible for the assassination of his uncle, President John F. Kennedy, and said his father believed the Warren Commission report was a “shoddy piece of craftsmanship.”

        Kennedy and his sister, Rory, spoke about their family Friday night while being interviewed in front of an audience by Charlie Rose at the Winspear Opera House in Dallas. The event comes as a year of observances begins for the 50th anniversary of the president’s death.

        Their uncle was killed on Nov. 22, 1963, while riding in a motorcade through Dallas. Five years later, their father was assassinated in a Los Angeles hotel while celebrating his win in the California Democratic presidential primary.

        Read more.



        January 04, 2013

        Magic Bullet, My Ass!

        by Len Hart, the Existentialist Cowboy

        I once spent several hours with a famous witness to the murder of JFK —Rosemary Willis, often called the little girl in the red dress. She is easy to spot in the Zapruder films, running along the south side of Elm street just ahead of her father, Phil Willis. Phil Willis was taking 35mm slide films of the motorcade. Rosemary is seen running ahead and, suddenly, stopping! Rosemary showed me her father’s slides and a double-page center-spread from one of the Willis photos depicting the Grassy Knoll.

        Her father’s photos had appeared in Look Magazine. One of the photos became a double-page spread. Rosemary and I placed the spread on a light table beside the original photo which had only recently been released by the FBI. Interestingly, those photos were seized AFTER Look had published.

        “Do you notice anything unusual’, she asked me.

        I looked again! It hit me like a brick! In the original slide there was NO train visible between the columns of the pergola.

        But the train was CLEARLY visible in the Look magazine spread. Why? Rosemary explained that AFTER Look had published its piece the FBI came calling. They SEIZED all of Willis’ original photos. When she showed those photos to me, they had only recently been released, having been in FBI possession for years. The FBI –playing the role of ‘Big Bro’ –did not want people to verify that there had, indeed, been a train on the tracks at the very time that the fatal bullets were being fired.

        But why?

        Then I recalled the ‘tramps’ who had been rousted earlier while hanging out in box cars behind the Grassy Knoll. Those tramps, as you recall, included Frank Sturgis and, the man whom I believe lead a team of assassins –E. Howard Hunt. As a result of my time spent discussing this with Rosemary, I became increasingly convinced that a team of shooters had targeted JFK; the box cars, the area behind the picket fence became a secured staging area.


        Incidentally, just prior to the shooting George H.W. Bush was photographed with his hands in his pocket ‘hanging around’ the front entrance of the TSBD.

    1. taunger

      Ah, ah, ah, be careful. Food stamps can be a wonderful tool for the oppressed to get AWAY from agribiz. Depends on the who/what/where, etc. Perhaps the same is even true of the War Racket, though I haven’t the first hand experience to argue so.

      1. diptherio

        Food stamps do a lot of good for a lot of people, to be sure…BUT, imho they also serve to conceal the true level of poverty in this country. In the thirties we had lots of folks standing in soup lines, today we have lots of folks on food stamps. One major difference is that people shopping with food stamps don’t make for any heart-rending photo ops. Today’s widespread poverty isn’t as in-your-face as yesteryear’s was, but sometimes I think that’s a mixed blessing.

  3. LAS

    Most people feel there is injustice. They just don’t understand how it works. Our culture covers it over.

    1. Brindle

      My liberal PBS NewsHour watching friends know things are generally stagnating or getting worse.
      They just unconvincingly say “those crazy Republicans” and sorta throw up their hands.
      They can’t come to terms that the Dems and Obama are simply corrupt.

      1. Banger

        If change comes it won’t come from the left. Whether you are talking liberals, pwogressives and real progressives or even the Chomsky or socialist left it is all without juice. The action can only come from the libertarian right.

        1. rob

          Is that sarcasm?
          The libertarians,like the cato institute and their koch bros agenda…. not too bloody likely.How about a “flat tax”, where the rich pay nothing,and every slob with a w-2 gets screwed….

          1. sufferinsuccotash, moocher

            The libertarian right is equivalent to the non-slaveholding shitkickers who rallied behind the Confederacy when the slaveowning oligarchy told them their “way of life” was being threatened. It’s conceivable that they could start something, but it’s doubtful that they could finish it.

      2. JamesW

        Yup, they think it is just a coincidence that everyone in the Obama Administration (just like the Clinton Administration) is a neocon.

        The latest example: Obama’s deputy nat’l security advisor and speechwriter, Benjamin Rhodes, who worked on Rudy Giuliani’s re-election campaign, worked on the draft of the Iraq Study Group for the Bush Administration, worked on the 9/11 Commission Report for the Bush Administration, and who’s brother was a favorite of Roger Ailes when he (David Rhodes) worked at Fox, and today is president of CBS.


        Or why neither so-called dems, nor of course r-cons, can answer the question Sen. Elizabeth Warren asked the other day:

        “In your opinion, how many billions of dollars do you have to launder for drug lords, before somebody says, we’re shutting you down?”


  4. roots

    I was with friends on Saturday, not good friends, but causal friends. During the course of our conversation, we touched briefly upon the financial troubles in Cyprus and I was mildly surprised when two of them casually expressed negative opinions about “Russian money laundering and tax avoidance” in Cyprus. I was surprised because these two are well educated professionals who hold important positions locally in their respective fields.

    All I could think was that the propaganda we’re exposed to is effective.

    1. from Mexico

      roots says:

      All I could think was that the propaganda we’re exposed to is effective.


      And when Yves says “Top executives have operated in a manner that is less obviously thuggish than the violent ways of some of Russia’s richest,” I would agree with that statement only insofar as the only difference between the Russian oligarchs and the US oligarchs is that the US oligarchs have better propaganda.

      During and after the WWII era, Scott Noble pieces together the absolute brutality and ruthlessness with which the American oligarchs, working hand-in-glove with the fascists and the Marxists, crushed the popular decentralized, local, self-rule movements that sprung up across Greece, Spain and Italy. (Those silly Greeks, Spanish and Italians, thinking the US was going to let them have anything close to popular democracy.) The sordid history begins here and lasts about 30 minutes:


      1. Thor's Hammer

        Does anyone remember the candidate for the “R” team in our recent national circus–er election?

        Pity that Bill Bain wouldn’t let him screw his existing customers when he started the private equity firm that became the foundation of his fortune. But where there is a will there is a way. Mitt’s solution was to raise 60% of the necessary seed money from Salvadorian oligarchs who financed the CIA backed death squads in Central America.

        But of course that didn’t make Mitt an oligarch, just a successful businessman. Facilitating mass murder didn’t even merit mention in the national news when the story surfaced a couple of months before the election circus.

        1. Grumpy

          “Death Squads” is a very similar meme to the topic of the article. Compare and contrast:
          A. Small countries in a death match killing enemies in raids, where the sweaty squad members could get hurt.
          B. World’s most powerful country killing enemies with drones, from air conditioned offices on the other side of the world.
          Big differences: better propaganda and TV zombified population.

      2. Chris Engel

        Yves even called a self-labelled Russian oligarch “well-behaved”…because he went to HBS and paid his bills on time! (cue the laughtrack)

        Truth be told, we’re all enslaved by the propaganda.

        We don’t all have a diverse set of primary sources where we can objectively figure out what stinks and what’s legit. We trust journalists to provide somewhat of a filter and to provide some kind of proper context.

        The problem is, and Yves has touched on this before, a lot of our journalists don’t have a proper historical/rhetorical/philosophical/literary grounding in the classics. So they either don’t recognize the games the powerful play, or they are just willing participants in the game.

        The key is to eventually come around and see where one has themselves made the mistake of eating up the Western propaganda rhetoric.

        Speaking of which, is anyone else just damn tired of hearing about the f’ing Pope’s daily activities?

        1. Yves Smith Post author


          I happen to know his background. You don’t. Easy for you to revert to stereotypes.

          He picked up industrial assets that no one was scrapping over. The big money and heavily connected KGB types were fighting over oil and other obvious stuff. He went after assets in the hinterlands where the value was not well understood. Everything was going for nothing, and he went after value plays that weren’t obvious to people who didn’t do homework or weren’t willing to inconvenience themselves by going to remote places. Thus no major thuggery necessary.

          1. Chris Engel

            I’ve heard more believable background stories from “political dissidents” released to Florida in the Cuban crime wave:


            He may have charmed you, but the truth came from your own words when you referenced him as an oligarch, rather than a legitimate businessman (unless you’re admitting guilt to labelling any Russian businessman as an oligarch).

            Obviously I don’t know the circumstances of this individual and particularly your relationship to him. And this article is good for pointing out the obvious rhetorical propaganda that has been foisted upon us against the Russian people in general, so I don’t want to distract from the positive message of this post. The central point is: American über-wealthy are acting more blatantly in an oligarchical fashion than the Russian elites, and the way the Western press has completely distorted the perception with a simple choice of what word to use to describe a disgustingly wealthy character is purposeful and sourced in the controlled narrative of our corporate press.

            But anyone can romanticize a road to building wealth. Hell, it’s impossible to find any wealthy person who doesn’t have some stump speech they give people about how it all came to be.

          2. Nathanael

            Chris, it is worth distinguishing between the clever and useful greedheads — the “value added” greedheads, you might call them — versus the brutally stupid greedheads.

            Veblen actually talks about that in his industrialist/financier distinction which I keep banging on about. Industrialists are generally grasping greedheads, but they have useful side effects. Financiers rarely have the useful side effects.

          3. Yves Smith Post author

            I don’t romanticize wealth, nor have ever thought the plutocratic land grab was good for Russia. In fact, in the initial years after the USSR collapsed, life expectance of men fell a remarkable 4 years, mainly due to the rise in alcoholism.

            I’m merely saying if you tiptoed around the edges of the fracas and picked your spots, you didn’t have to engage in the hit jobs that were not uncommon in the land rush to get energy and other prime assets.

      3. Susan the other

        Thanks Mexico; good vid and also went to “the crisis of civilization” vid – also good. We need to frame the question now. My takeaways boil down to the basics: WTF. Money is not economy. It certainly is not survival. And don’t kid yourself – you are not a survivor dude – maybe, with a top hat, you’ll survive for the last half-hour.

    2. gepay

      If you are moderately well off in the US, mostly you will believe the mainstream media and have their take on world events. The “official conspiracy theory” is too stupid to belive, there must be better one (some German said that) but talk to your sterotypical NPR listening liberal who voted for Obama and Like my sister said to me – “you’re not one of those conspiracy wackos, are you?
      There are layers and layers of elites…oligarchs… plutocrats… whetever you want to call them, the powers that be. Start with some of what’s left of the Royal Families of Europe – is not Queen Elizabeth one of the richest women in the world. Is not (is she former now?) Queen Beatrix the largest stockholder in Royal Dutch Shell?

      It goes on from there – The largest German conglomerate? Krupp-Thyssen- do you imagine the progeny of the namesakes are wealthy? BARON HANS HEINRICH THYSSEN BORNEMISZA DE KASZON, who died in Spain aged 81,2002, was one of the richest men in Europe. And the Germans lost both world wars.

      Or the Agnellis in Italy or Rockefellers in the US.

      1% of the world’s population is now around 70 million people so there is no space for all the names of the global elites. .1% is still 7 million which is closer to the number of people who run the world. They fight among themselves which is how “we” learn about them. Big Oil has different interests than say Bill Gates.

      mostly they are families as that is the best way for wealth to stay controlled for generations.

      1. jake chase

        This popular anger directed at the “one percent” is part of the propaganda problem. A great majority of those making up that one percent are merely lucky, either by birth or opportunity or connections resulting from education, or even, darest I say it, enterprise. They control nothing; they are controlled by market fluctuations, fleeced by taxes which are nothing but a nuisance to the uber rich, chiseled by banks and brokers and insurance companies, conned by investment advisers and lawyers. Their only real advantage lies is not needing to borrow money, or to bet the farm in order to live decently. What they are is the last remnant of an American middle class.

        In America, our larger problem is a toadying class of executives, academics, journalists and politicians that supports the claims and the tenure of the truly rich. Unsurprisingly, they do it for the money which trickles down to them. I wonder when somebody will start writing about this?

  5. Larry

    The elite classes are seeking rent in every aspect of public life, this seems like a big switch to me. The corporatization of public education is the prime example that comes to my mind. Everything behind education reform is done to undermine labor (bust teachers unions) and make it easier for companies to profit from universal standards. I could be wrong, but it seems in the past that oligarchs stayed largely out of these fields. Now they completely bend them to serve their needs for capital return.

    1. John

      If you listened to CPAC this year you will know they are just getting started. The Right sees privatizing education (they call it “choice”) as their next Holy Grail.

      1. Carla

        To wit, “News Corp Spends Big on LA School Board Race, Sets Sights on Public Education “Market” by Brendan Fischer — March 11, 2013.

        Rupert Murdoch invested $250,000 in the LA School Board race.”Murdoch has called the for-profit K-12 education industry “a $500 billion sector in the US alone that is waiting desperately to be transformed.” He’s just doing God’s work, dontcha know.


      2. Eureka Springs

        If you listen to Dems you will quickly realize they agree. Only the buzz words differ… not the goal.

    2. Banger

      The American oligarchs are systemized and have become intricately and holistically involved in all aspects of society with the intent to conquer it completely. We have cadres of psychotic ally ambitious executives at all level who, like ants, search out any possibility to present credible plans to their superiors and they are as utterly ruthless as any cadre of elites that has ever lived. In a way that makes analyzing the American political economy stunningly easy. I have, for example, been surprised by nothing in the past decade other than the breathtaking speed public anger at the financial crisis was, in the blink of an eye, disappeared into the ethers. That took even me, a student of Machiavelli, by surprise.

      1. larry

        US oligarchs are from from being psychotic – they do not confuse fantasy with reality. I think the term you are looking for is psychopathic. For an informed and detailed discussion of this, see Joel Bakan’s The Corporation.

        1. Banger

          You are right in a sense–but it is a question of perspective. Psychotics are often quite orderly in thei conceptual frameworks but they don’t jibe with reality. To me the people I speak of are at least functionally psychotic. In my experience they often believe their own bizarre narratives and from the point of view of society and Mother Earth they are psychotic because thei actions are clearly an unambiguously destructive while they themselves believe they are just fine. I have found elites in other societies are often more mindful and honest about their own thieving hearts and they I classify as psychopathic.

    3. Michael Fiorillo

      Larry, you are absolutely right, but it’s even worse than that: the misleadership of the teacher unions themselves are enabling the hostile takeover of public education.

      AFT President Randi Weingarten is on the advisory board of InBloom, Inc., a Bill Gates front that is in the process of amassing confidential student information, and which will be supplying it to for-profit vendors.

      Additionally, the AFT/UFT (the NYC local that is the tail that wags the national union dog) have signed on to mayoral control of the schools, Obama’s Race to the Top, and test-based teacher evaluations that result in closing public schools, expanding privatization and neutralizing the union.

      Rahm Emanuel recently announced plans to close almost 10% of Chicago’s public schools; almost 40% of DC students now attend charters; emergency managers in Michigan are tearing up collective bargaining agreements and shuttering public schools; the imposition of Common Core Standards and the explosion of high stakes tests in all subjects are to be used as weapons to close schools and disenfranchise parents in suburban districts that heretofore have been relatively unaffected by so-called education reform.

      The endgame for public education is in sight, leaving only Social Security as a viable public for the 99%, and as readers of this blog well know, Obama is the Trojan Horse hired to begin its destruction.

      1. Ms G

        inBloom is not just a Bill and Melinda Gates (charitable)front whose obvious main purpose is to use the New York City student population as a field of data to be sold to the highest “third party vendor.”

        inBloom in fact involves a JV of several other (non-Russian) oligarchs.

        First there is Murdoch, who owns Wireless Generation, the lead “subcontractor” on the inBloom development.

        Then there is Joel Klein, Bloomberg’s former Schools Director who left DOE (after giving the inBloom contract to Wireless Generation) to go to Wireless Generation and be the chief there.

        Then there is Michael Bloomberg, who authorized the New York City RFPs for this monstrosity and — when Wireless Generation was dumped from its no-bid contract following the Murdoch privacy scandals — figured out a way to put Murdoch-Klein-Wireless back in through the backdoor of allowing Wireless to become the “subcontractor” of the (also) Oligarchic “Boston Consulting Group.”

        And the name of this “thing” is “inBloom” — come on!

        This is an exquisitely planned mass attack by our very own Oligarchs.

        1. taunger

          Well, I guess the Seattle connection was just too much . . .


          First line is “Sell the kids for food . . . .” It’s too bad, I think Cobain has something great to say, but couldn’t find the right medium. If he were here today with the digital music landscape it could be very exciting.

          1. Chris Engel

            Cobain admitted that most of his lyrics didn’t have any hidden meaning, they were just things that sounded poetic and good that he threw together:


            “I was using just garbage…stuff that would spew out of me. A lot of the times I write lyrics in the last second, because I’m lazy, and then I find myself having to come up with explanations.”

            Whether you want to call it an ironic admission or you want to find the prophecy in his self-admitted meaningless lyrics, doesn’t make a difference. But “digital music landscape”? please, most of it garbage and weird hypnotic meaningless repetitive crap with barely tolerable beats. and i’m in my 20’s so it’s not because I didn’t get the exposure or it’s ahead of my time..

    4. harry

      Very true. They are running out of economic activities to extract rent from. Hence the interest in greenfield areas like Chicago public schools.

      This is likely to get very nasty. It will look to all the world like the rent strippers are winning cos they have the ear of the government and they are the elite. But they are starting to mess with a very large proportion of the populations ability to make a living. There will be some comeback from this and they may be surprised at the ferocity of the fightback.

      As all muggers know, careful who you rob. I think the elites will regret Rahm Emmanuel’s education rent grab

      1. Ms G

        For the Looter Oligarchs Detroit right now is what the gold rush valleys in California were back in the late 1800s. Except now they’re not “just” extracting ore from the ground — they’re setting up human slave structures financed with public money.

    5. JamesW

      I could be wrong, but it seems in the past that oligarchs stayed largely out of these fields. Now they completely bend them to serve their needs for capital return.

      Negative, historically they always did the OPM (or “other people’s money”) routine, simply earlier there were countervailing forces, whereas today America is a completely fraud-based country/society where both parties are completely owned and controlled by Wall Street (sure, there are some exceptions, as there always are: Sen. Warren, Rep. Defazio, and before they were manipulated out of congress, Reps. Kucinich and Cynthia McKinney).

      Cross-stock ownership is illegal, and has been for quite some time, but that’s how they did it when Louis Brandeis wrote his, Other People’s Money and How the Bankers Use It, and today it is the way the super-rich own everything, without any American knowing who those owners actually are.

      And no, it is not the “shareholders” or “us” (through our pensions and IRAs and 401s, etc., who “own” them.

      In France, the citizenry is aware of the owners of their French-based oil multinational, Total, but does any American have the vaguest idea of who owns ExxonMobil, JPMorgan Chase, Morgan Stanley, Citigroup, Bank of America or even Bank of New York Mellon?

      Of course not. . . .

  6. Chris Engel

    This is something I’ve commented about in the past.

    It’s absurd to call the crooks who have robbed or attempted to rob the Russian people of their wealth “oligarchs”, but then to turn around and call the cut-throat corporate vultures of Wall Street elite stewards of capitalism or “philanthropists” or merely “wealthy”.

    The Western press has masterfully perpetuated this hypocritical view of the wealth accumulated in the West vs. Russia and vs. China as well. Notice that the press doesn’t dare call the Chinese billionaires in the communist party “oligarchs”.

    It’s interesting how these terms get latched on to certain nations and cultures in pop-foreign-affairs discussions. It’s entirely originated by Western journalists pushing a corporate narrative of Americana that excludes the harsh reality of both the inequality and injustice of our modern system.

    1. Chris Engel

      I’ll add that oligarchy as a term and a topic of political discussion goes back to Aristotle and the Greek philosophers.

      “You can’t sustain a democracy in an oligarchic state. The writers on Athenian democracy understood that 2000 years ago,”

      – Chris Hedges, “The World As It Is: Dispatches on the Myth of Human Progress”

      The rich in the US are controlling policy. Since the 80’s they’ve been rigging the tax and regulatory framework to redistribute wealth upward.

      “The reality is that conservatives have been quite actively using the power of the government to shape market outcomes in ways that redistribute income upward. However, conservatives have been clever enough to not own up to their role in this process, pretending all along that everything is just the natural working of the market. And, progressives have been foolish enough to go along with this view.”

      – Dean Baker, “The Conservative Nanny State”

      It started with Reagan, got worse in Clinton, and was maintained and finalized with the W. Bush tax cuts and benign neglect which Obama has continued (the exception are cases like Enron and Madoff, where rich people got hurt).

      Oligarchy in its most basic definition is one where the ruling class protect and grow their wealth in their rule of a nation or society. Is there any doubt that, given the trends since the 80’s in both market deregulation, tax expenditures for the wealthy, and the growth in inequality and destruction of the middle class, that we have been in an oligarchal rule under the bankster corporate overlords and the military industrial complex, which includes all the moguls of Wall Street in energies, insurance, and banking.

      It’s worth noting that Simon Johnson, someone who has demonstrated his competence in academia and policy at the IMF, and who has also tirelessly attempted to inform the public of the misdeeds of the powerful money changers, has focused specifically on the American oligarchs in the finance industry, as early as 2009:


      In times of crisis, if the government doesn’t stand up for the people and use taxation and spending to fix the gross inequality that comes about from forms of unfettered capitalism, then the result is a massive wealth grab.

      The writing has certainly been on the wall for decades, but this last crisis really has been the last straw. The despair will outweigh the pride of this new generation at some point, and the people will stand up in traditional American populist sense and demand true change (not Obama-brand).

      1. Colin K

        Oh, come off the bemoaning of the Bush tax cuts as some sort of devious coup of grand importance.

        Sure, those tax cuts were/are another leg up for the ruling class, but it’s like complaining about Citizens United—at this point, it’s just a drop in the bucket of influence and consequently a point of false pride for anyone, anyone at all, to act so offended by the power of corporations.

        Overturning CU as a rallying cry misses the forest of state-granted corporate personhood from the trees of campaign finance reform. In typical leftist fashion, natch. (Of course, CU has resulted in some folks questioning the idea of corporate personhood itself. They’re just about 150 years too late. And they aren’t really serious about addressing the problem of state-granted legal fictions vis-a-vis corporations because seriously addressing that problem necessarily entails undoing the entire structure of their society.)

        On topic: most federal income tax revenue pays for empire-sustaining war and empire-sustaining interest on the national debt. Lower tax rates indirectly function as an effective veneer cum story for some dismantling of social programs, but that’s almost literally it.The only arguable direct function of raising income tax rates is to claw back some of the ruling class’ ill-gotten gains. But, you know, haha on that.

    2. Up the Ante

      You used to read that most of the hackings originated in Russia and were routed thru China. You don’t hear such mention anymore.

      [please view our offerings as ‘high-level’ hacks, is it ?]

    3. JamesW

      Exactly, and well articulated!

      How many American (consumers) know how the Morgan fortune originated? (Taking mustkets market as defective by the Yankee quartermasters, re-labeling them as good, then bribing quartermasters and re-selling them to the US government, where an estimate one out of five Union soldiers died from exploding Morgan muskets.)

      Or that Andrew Carnegie (Carnegie and his protege, Schwab, sold the subs to Germany which they would later use to sink the Luisitania) made his primary fortune while superintendent of military railways and telegraphs during the Civil War (his inside information allowed him to make a killing in stock and share investments, then later used his position to get government contracts in iron and steel projects).

      1. Ms G

        It is so refreshing to have your focus on historical facts at the origin of the American Oligarchs. Thank you and thank you (one for Morgan and one for Carnegie).

        Do you have any information about what else old man Kennedy was up to besides bootlegging? They were chumps in comparison to the big baron oligatchs, though — I think.

        1. Nathanael

          There was a period when the powerful crooks made a point of doing something useful along with their theft. I’m not talking about charity — I’m talking about the fact that Carnegie caused steel mills to be built and steel to be manufactured and used.

          Veblen discusses this in Theory of the Leisure Class. He distinguishes between the industrialist phase and the financier phase.

          Both are anti-social, nasty, grasping people, but the industrialists have useful side effects. The financiers don’t. They don’t even understand where their wealth comes from — they don’t know how the factories work or anything.

          Jay Gould was perhaps the most famous of the 19th century financiers, having made his money by NOT operating railroads, but merely by manipulating paper.

          We have gone beyond the financier phase now. Now our elites don’t even understand how the legal and financial side of their operations work. You can see this in the Senate testimony of the JP Morgan execs about the London Whale. The “explanation” they were given as to what the London Whale office was doing was simply nonsense — words strung together without meaning. THEY DIDN’T NOTICE, because they don’t actually know a damn thing about their business.

          This is what I call the “upper-class twit” phase of capitalism. It is the end stage. It is *absolutely guaranteed* that the upper class twits will be thrown out of power, because they are too incompetent and useless to remain in power.

          The question is *who will replace them*. If we do not manage to organize a pro-democracy movement to replace them, one likely outcome is neofeudalism; but these clowns like Blankfein and Dimon will NOT be the feudal lords.

          No, Brin and Page and Gates and Bezos and Buffett will be the feudal lords. The way it will work is: pledge your allegiance to Google (, Microsoft, Amazon, Berkshire Hathaway) and the feudal lord will take care of you, a valuable service when the government and existing elites are making a huge mess.

          Google’s already started this trend, what with providing practically everything for its employees: food, shelter, transportation, recreation — clothing will be next.

        2. jake chase

          I understood Kennedy was a pool operator on the NY Stock Exchange. Pool operators were fronts who operated on undisclosed big money to move stocks up or down, extracting profits from gullible ‘investors’, who gambled on thin margins during the Twenties. Basically, they took candy from babies. This was nothing more or less than market manipulation, but that term hadn’t been invented.

          I believe he also owned or controlled a movie studio, possibly RKO.

  7. Stephen Gardner

    “Why Does No One Speak of America’s Oligarchs?”

    Primarily because our oligarchs wouldn’t like it and they own the media and thus control what gets talked about.

        1. Bill Smith

          Well, the White House is in the Zoo Group.

          Actually, NPF describes themselves as a charity collecting money for the US park system. We haven’t sold our parks off yet. But maybe the Easter eggs are tax deductible…

          1. Valissa

            Historically speaking it was wealthy elites who pushed for the National Park System, and who started most of the various environmental awareness/rescue organizations (and who primarily sit on the baords of these). Nothing wrong with this, it’s rather like the way the elites fund the arts, and such philanthropy is basically a good thing for society as a whole. But because of this connection I do not expect to see the National Parks privatized.

    1. JamesW

      Well, according to Simon Johnson, former stooge of the IMF, the Rockefellers gave away all their fortune (the Rockefeller family was worth an estimated $30 billion in 1960, the Mellon family was the third richest in the world in 1970, etc.) and didn’t really shift it over to foundations, trusts, unregistered trusts, offshore trusts and offshore finance centers, etc., to hide their ownership and wealth.

      So, do ya really believe the Rockefellers are only worth $2 billion today? Or that the du Ponts are struggling? Or that the Mellon family is middling and lacking in power?

      Is the Guggenheim family really just middle-class?

      Those Koch brothers are rich, but they are down at the bottom of the top 20 families in America (and no, I’m not talking Gates OR Buffett)!

  8. Banger

    On balance, Americans prefer fantasy to what most of us posting here would call reality. “Americanism” or the bizarre cult of American Exceptionalism are critical parts of our public identity–there are deep cultural reasons why this ideology is necessary but, nevertheless, it dominates public discourse at all levels. Sadly this ideology also dominates American intellectual discourse. In a sense the U.S. is a one party state–if you do not accept the fundamental ideology of the USA you are relegated to obscure corners of the internet not because there is some Central Committee making decrees but because most people ardently do not want their world disturbed in public. Privately many Americans know the score they just don’t want to be reminded of it. That’s why as many as 70 per cent of the American people believe JFK was assassinated by a conspiracy yet the subject, despite hundreds of books and endless reams of evidence cannot be discussed–we Americans are a dysfunctional family who knows that daddy is fucking sister but we all have to get up every morning to go to work and get on with life–confronting the issue is just too disrupting.

    In this way any ideas that American elections can be stolen, political leaders killed, any of us taken out behind the garage and shot at any time for any reason if the President so decrees or that we live, in fact, in a society dominated by oligarchs is just to painful to contemplate in a country where you really cannot completely rely on anyone where part of the reigning ideology is that we are each on our own and should we fall the net may or may not be there. Believing we are the greatest and most fair county in the world–a beacon of hope to an ungrateful world is deeply comforting.

  9. Klassy!

    “Now Johnson carefully laid the bread crumbs, but so as not to violate the rules of power player discourse, pointedly switched from the banana republic term “oligarch” to the more genteel and encompassing label “elites””.

    Honestly, the term “elites” has become so thoroughly debased that it makes little difference to me if he uses the term elites or oligarchs.

    1. Alejandro

      Excellent point. OWS gave us the 1%-same people but with quantitative emphasis. When I first heard it, the question I could not shake was “How can so few, dominate and control so many without our implicit or expicit, consent and cooperation?”

    2. John

      People do not even understand the word oligarch.

      So it is useless to expose them and their crimes using the word.

      As to word elites being debased, all I can say is no matter who I say CRIMINAL ELITES to they shake their heads yes in understanding.

  10. Paul W

    Thank you for the piece Yves. Media Lens in Britain is also great at showing the hypocrisy of media coverage.

    I’m afraid our criminal elites have won and all that is left to do is see what exactly their neo-feudal society will look like.

    Two things going against us: the first is normalcy bias. Most people don’t want to know what’s going on and even when they do hear anything they refuse to believe it, or at least, refuse to believe it will change anything in their lives. Meanwhile the frog continues to slowly boil.

    The second is that we’ve become such a non-violent society we are no longer capable of fighting back. If Merkel is as bad as I read then where are the Baader-Meinhofs? 80 million Germans and they can’t find a dozen to try and take down the government. Where are the Red Brigades in Italy kidnapping technocrats? How about the FLQ in Quebec(I recently heard Canada referred to as the subtle Police State). Even in Ireland, the Real IRA are too busy in the north working on their latest drug deals, while Sinn Fein certainly has no Michael Collins in its ranks any longer.

    Perhaps I’m just being nostalgic for the 70’s and 80’s. There were wolves in our society back then. Today we’re all domesticated dogs. Someone call the Humane Society!


      The wolves of the 70’s & 80’s are now old enough to be willing to die for the future. Never fear violence.

    2. Banger

      Great comment. People are less violent an less passionate particularly on the left. This is a complex subject but let me bring in a few thoughts here. We are all dealing with information overload– we spend a lot of energy just digesting thing such than conceptual frameworks become weak and overly ambiguous. The effectiveness of propaganda and mind-control techniques have become much better and has extended more completely in the realm of popular entertainments. Popular entertainments have multiplied greatly and are now tailored to individual demographics. The raw power of large corporation and industries has solidified and the international oligarchy has become more robust than at any time since Rome. And finally, despite inequities and a criminally minded elite, most people are content with what their betters are giving them and are gladly marching to a neo-feudal future.

      I had predicted this 25 years ago an it is coming to pass. The key was the utterly supine position taken by the American population after the financial crisis when the true rulers of the U.S. visibly took control and, in my view, seized the state lock, stock, and barrel. Now, all we can do is watch. I have tied hard to suggest ways for the left to organize that would actually build something but the left in the U.S. at least has no interest in effective strategies (Occupy was just chaotic complaining). I have given up on the left they are morally an intellectually bankrupt and politically dead as a movement. I’ve been very reluctant to accept Morris Berman’s evaluation of American society but he makes more sense with each passing year. I have some hope that something may come from a combination of the libertarian right and fragments of the left as I see young people moving in that direction.

      1. Nathanael

        Be more optimistic. Anti-foreclosure house occupations are starting to become more common. This is the first sign.

    3. NotTimothyGeithner

      Historically, violent reactions or ones with the threat of violence don’t come from gradual decays. The French, American, and Russian (even the dissolution of the USSR) revolutions don’t follow a period of neglect from the elite despite popular fiction. 1783 was much worse than 1789 in France. 1908 was much worse than 1917 in Russia. Relations between the colonies and Parliament was much worse in 1768/1773 than 1775. The situation in Germany in the early 20’s was arguably worse than 1933. In one situation, Hitler was tossed in prison, and in the other, the people rolled over to be ruled by the same center right assholes.

      All of those revolutions and changes had been preceded by period genuine liberalization and rising economic tides. What I think people really revolt against is undoing past success. Even in Egypt (obviously there is a slight pan-Arab thing), there were widespread protests and revolts in 2008 after spikes in food prices. Promises were made to make everyone go home. When food prices went up, everyone said, “promises weren’t kept” and, “its time for change.” Its not a story of social media or twitter. Every revolt plays out the same way. If things are just good enough people put their heads into the ground.

      Even the Civil Rights movement in the U.S., which was partially broken up by World War II, had its genesis not in the brutality of white Southerners against Southern blacks, but it came about when African-Americans who found better jobs during World War I in the North or cities like Birmingham/Atlanta started to lose those jobs. There is a similar situation with World War II and African Americans. Except African-Americans remembered the post World War I situation and didn’t want to go backwards again. People who didn’t join one of the various civil rights outfits, Garvey, Booker Washington, and the NAACP started to change. This time they said, “Garvey is out (I think he was dead) because I’m not going back to Africa or whatever island he wants,” “Washington wants a black aristocracy with a solid second class citizenship status,” and “the NAACP wants equality.”

      The Northern, white reaction to the South doesn’t come from the death of a random Southern black, but it came after the death of Emmett Till, a kid from Chicago. At some level, the death of Emmett Till represented a return to Dred Scott. Northern whites and blacks knew about Jim Crow, but there was a sea change after the death of a CITIZEN about how the South should be treated. White Southerners forgot they lost. Part of the issue is who would be next while white Southerners hid behind Southern, local governments.

      Many people have to learn a hard lesson or at least be exposed to one. Some sociopaths (they aren’t just elites) will never get it, and they need to be exposed no matter how nice they are.

      1. Nathanael

        This is a good summary. It’s worth considering under what circumstances people can lose things they were accustomed to, and yet not revolt: the answer from history is “extremely slowly”. The decline from the Roman Empire into the Dark Ages was a several-hundred-year enterprise, long enough for generational loss of memory.

        Our kleptocrats are, therefore, moving too fast. There are too many people who remember what it was like in the 1950s, and too many who grew up hearing what it was like in the 1910s and 1920s.

    4. Myshkin

      I’m not sure our so called representative government is any worse now than it was thirty, sixty or seventy years ago. That is not to say anything laudatory about our current affairs. Looking at the devastation in the world and how humans are the principal participants, one can only conclude that we are, in fact, as Bill Burroughs suggested, killer rock apes and though we may be improving it is too little and too late to save us from our own stew.

      As for your nostalgia for the Red Brigade, Baader Meinhoff, IRA and violent opposition, having watched that period and how it all worked out, I believe your enthusiasm is misplaced, after all we have arrived at where we are by having passed through those times.

      1. Paul W

        The nostalgic comment was written with my tongue firmly in cheek. I’m not supporting these groups. After all, the RAF in West Germany were a bunch of misguided thugs who set off bombs at army bases and robbed banks because they couldn’t figure out what else to do with their lives. Ulrike Meinhof trying to send her children to a Palestinian refugee camp. These people did not have their heads screwed on tight!

        Rather I was simply asking why is society so different today that there is no violent reaction at all? Matters are far graver at present, yet the reaction is muted. Maybe the internet – with all its ranting and raving – serves as society’s pacifier.

        I’ve always said that one Charlotte Corday might curb much of our elites excesses. If there was a consequence to starting wars or raping countries economically then our elites might think twice before acting. Instead, the only reaction they know they’ll face will be nice, controlled, peaceful demonstrations. The only thing missing is Leni Riefenstahl filming them. Assassinate just one politician or banker and the narrative could change dramatically.

        We shouldn’t really complain. So long as they keep the global pyramid scheme going there’s loads of material stuff to make the majority quite happy. We do still lead lives that royalty from a hundred years ago would envy. If the material stuff does run out then we’ll see if Che Guevarra comes out of the closet.

        1. DANNYBOY

          And you, Paul W, I hope are being sarcastic about your sarcasm: “We shouldn’t really complain. So long as they keep the global pyramid scheme going there’s loads of material stuff to make the majority quite happy. We do still lead lives that royalty from a hundred years ago would envy. If the material stuff does run out then we’ll see if Che Guevarra comes out of the closet.”

          The ‘material stuff’ has run out for your countrymen. And do you really believe that that is what’s wrong with our situation, that perhaps there won’t be enough stuff?

          Get out more

          1. Paul W

            I was reasoning why the majority do not protest, do not support protesters and are certain the status quo they’ve known all their lives will continue. We are 100 times better off then any people in any society in human history. That’s why people are sticking their heads in the sand. As bad as things may have become they are still pretty good, relative to the rest of history. The problem, which we realise here, is that the current path is unsustainable. Unfortunately it will have to fall apart before enough people realise it. then it will be too late.

          2. DANNYBOY


            Then I repeat: “The ‘material stuff’ has run out for your countrymen. And do you really believe that that is what’s wrong with our situation, that perhaps there won’t be enough stuff?

            Get out more”

            Perhaps I should explain by example. One close at hand. I have as much wealth as I need. Pretty simple so far, right. I do, however, contrary to Paul’s recorded observations, protest, support protestors, and do not stick my head in the sand. My reasons are of course that I am miserable about 6,000,000 people’s prospects, including my own children. I hate what I see. I hate those who prey upon EVERYBODY.

            Now Paul, do you think that I am unique is some special way? I dare say not. 6,000,000 others hate what they see and their own treatment. So why is it, then, that they aren’t fighting (yet)? THEY ARE F_KING FRIGHTENED. They are so F_ing vulnerable that they dare not.

            That’s why.

          3. Nathanael

            Danny: people will tolerate a lot before they revolt.

            One thing they won’t tolerate is a food shortage.

            Another thing they’re unlikely to tolerate for long is theft of their houses, though that tends to cause a slower-burning revolt.

        2. Myshkin

          “Why is society so different today that there is no violent reaction at all?”

          -There is violent reaction today; there are those with assault rifles and their own private arsenals who believe that at some point they are going to rise up. Generally they are people who are confused and don’t understand whose pulling the strings on the puppets that so enrage them. They can be forgiven somewhat their rage and their confusion, there is a vast industry of misinformation and entertainment to obfuscate.

          The militia movements suggest to me that only pain will result, and mostly upon the wrong people, if there is an armed insurrection. Peaceful protests, civil disobedience, informed voters can be effective but there have to be many more and they have to be far better attended.

        3. Nathanael

          “Rather I was simply asking why is society so different today that there is no violent reaction at all? Matters are far graver at present, yet the reaction is muted.”

          That’s what they said in 1780s France.

          Rulers! Beware the muted reaction: it consists of people who are not going to go off half-cocked. It does not mean that there is no movement happening. It means that there is a movement happening which you cannot see and cannot suppress.

      2. DANNYBOY

        Myshkin, your resignation is only one of the paths ahead. And your qualifying Resistance as futile both because it is a little too late and because previous efforts brought us here. Perhaps you are misinterpreting this brief part of history, as without resistance, things would today be a lot worse. And that is true for the future. So buck up.

  11. Brindle

    Is there a single talking head, news anchor, cable news show host on the major networks who has publicly stated they believe JFK was killed as a result of the actions of more than one person?
    The acceptance of the conclusion of the Warren Commission appears to be a pre-requisite in able to have a job in major media in the USA.

    1. Banger

      There is a virtual central committee that has a clear and well-worked out propaganda line that is rigidly adhered to by the media. I was amused when Chris Hayes made some negative remarks on air about the U.S. military and was forced to walk them back. You cannot criticize the military in the U.S. anymore. Hayes had no choice–he’s still young and has clearly been promised the Moon by the execs so he had to stay within the boundaries or never work in the industry again. His story has been repeated ad infinitude.

      1. neo-realist

        Along those lines, criticism of the police state apparatus has been pretty much silenced: In the early days of police state brutality against the occupy movement, I recall Rachel Maddow and Lawrence O’Donnell being very vocal about police brutality against the demonstrators on their shows, then all of a sudden they clammed up! Did the suits get to them? Homeland Security? The Justice Department?

        1. banger

          I don’t know–all those figures are careerists above all so it was probably the suits and the bean-counters who probably told them that police people are held in high regard by most Americans, even on the “left” so STFU. And it’s true–generations of positive cop show showing cops to be honest people who care about others who actually mainly have a conscience who usually fall on the side of justice is hard to overcome. Americans don’t like facts about cops–and don’t want to know the depth of corruption and sadism of many PDs.

    2. Bev

      Did not see your question before posting:


      You will be very pleased with long-time professional, brave reporter Len Hart and NYU professor Mark Crispin Miller:


      RFK children don’t believe that Oswald acted alone

      RFK children speak about assassination in Dallas

      updated 1/12/2013 1:57:58 AM ET

      DALLAS — Robert F. Kennedy Jr. is convinced that a lone gunman wasn’t solely responsible for the assassination of his uncle, President John F. Kennedy, and said his father believed the Warren Commission report was a “shoddy piece of craftsmanship.”

      Kennedy and his sister, Rory, spoke about their family Friday night while being interviewed in front of an audience by Charlie Rose at the Winspear Opera House in Dallas. The event comes as a year of observances begins for the 50th anniversary of the president’s death.

      Their uncle was killed on Nov. 22, 1963, while riding in a motorcade through Dallas. Five years later, their father was assassinated in a Los Angeles hotel while celebrating his win in the California Democratic presidential primary.

      Read more.



      January 04, 2013

      Magic Bullet, My Ass!

      by Len Hart, the Existentialist Cowboy

      I once spent several hours with a famous witness to the murder of JFK —Rosemary Willis, often called the little girl in the red dress. She is easy to spot in the Zapruder films, running along the south side of Elm street just ahead of her father, Phil Willis. Phil Willis was taking 35mm slide films of the motorcade. Rosemary is seen running ahead and, suddenly, stopping! Rosemary showed me her father’s slides and a double-page center-spread from one of the Willis photos depicting the Grassy Knoll.

      Her father’s photos had appeared in Look Magazine. One of the photos became a double-page spread. Rosemary and I placed the spread on a light table beside the original photo which had only recently been released by the FBI. Interestingly, those photos were seized AFTER Look had published.

      “Do you notice anything unusual’, she asked me.

      I looked again! It hit me like a brick! In the original slide there was NO train visible between the columns of the pergola.

      But the train was CLEARLY visible in the Look magazine spread. Why? Rosemary explained that AFTER Look had published its piece the FBI came calling. They SEIZED all of Willis’ original photos. When she showed those photos to me, they had only recently been released, having been in FBI possession for years. The FBI –playing the role of ‘Big Bro’ –did not want people to verify that there had, indeed, been a train on the tracks at the very time that the fatal bullets were being fired.

      But why?

      Then I recalled the ‘tramps’ who had been rousted earlier while hanging out in box cars behind the Grassy Knoll. Those tramps, as you recall, included Frank Sturgis and, the man whom I believe lead a team of assassins –E. Howard Hunt. As a result of my time spent discussing this with Rosemary, I became increasingly convinced that a team of shooters had targeted JFK; the box cars, the area behind the picket fence became a secured staging area.


      Incidentally, just prior to the shooting George H.W. Bush was photographed with his hands in his pocket ‘hanging around’ the front entrance of the TSBD.

      Read more at http://www.nakedcapitalism.com/2013/03/why-does-no-one-speak-of-americas-oligarchs.html#24OevtwuMe6kXGI5.99

      1. Nathanael

        I have a personal pet conspiracy theory: I think that all of the suspicious behavior surrounding the JFK assassination is a subtle propaganda campaign to distract people from the *far* more suspicious assassination of RFK.

        Bluntly, the assassination of JFK did not serve right-wing goals. In fact, the accession of Johnson to the Presidency with the nation mourning for JFK got a bunch of left-wing policies implemented which would have been very hard to pass otherwise.

        The assassination of RFK *did* serve right-wing goals. Derren Brown has proved by experiment that Sirhan Sirhan’s story of brainwashing and hypnotism is completely possible. There’s never been a plausible motive for him other than that. The physical evidence was completely contaminated almost immediately after the RFK assassination.

        It serves the interests of the people who had RFK assassinated to distract everyone with JFK conspiracy theories.

  12. Cletus

    We are the equivalents of the post-Civil War residents of the great southern plantations. We still live, mentally, the false dream of the great cultural lie that we had a free society that was strong, self-suffcient, morally correct, and a shining beacon to every other nation (and all others were/are inferior), on earth.

    We prefer to live the dream. It is a very low-maintenence existence.

    In effect: “We were great, once, and not so long ago. Our present state is a bump in the road that we will recover from in due course, by our very nature, and without personal or cultural effort.”

    “We are Americans. We are exceptional.”

    The truth is, we have been robbed, and we enabled our own victimization.

  13. Jesse

    What I tend to find discouraging is that the ‘liberal class’ so quickly bows to the oligarchy, such is the shallowness of their commitment to reform and genuine change.

    Krugman, the drum major for the liberal economists, falls into the meme of the oligarchy so easily, along with so many others, even while proudly prancing his liberalism.

    Truly discouraging times if one views them from a certain perspective.

    1. Wat Tyler

      The manner in which Krugman has utterly ridiculed Paul Ryan as a fraud and shill disputes your accusation. Cut him some slack why don’t you – at least he is trying to counter the lies with facts and reason and has a large enough audience to make a difference. Krugman is one of the good guys IMO from this blogs point of perspective.


      1. NotTimothyGeithner

        Exposing Paul Ryan is like dropping dynamite into a barrel of fish and then claiming credit for inventing fishing.

        I bet pointing out Sarah Palin is an idiot means someone is a super genius.

  14. OMF

    They’re not “elites”; “elites” imply that these people are actually competent at doing their jobs.

    The correct term, is “ascendancy”.

  15. Paul E. Boy

    Fred Hiatt has jumped the shark™


    Fred Hiatt
    Editorial Page Editor
    Fiscal stalemate needs Obama’s leadership
    Published March 24, 2013

    “What could shake them out of their own devices? One possibility, a fiscal hawk in the Obama administration told me almost wistfully, would be a “minor market event.” A stock market plunge, an interest rate spike, a race to the exits by America’s foreign lenders — just enough to spook Congress.”

    How influential is the alleged editorial page at that erstwhile newspaper? He’s carrying water in a leaky bucket for charlatans and spilling all over himself. I hope we’ll have a handy record for millenia of the preposterousness™ that is the wapo editorial page. Mind-boggling are the sleight-of-hand (distortions), simplifications (distortions), lies (distortions), or whatever the kids are calling it all these days, being practiced over on 15th and L.

    1. NotTimothyGeithner

      If this wasn’t how the Obama Administration behaved, this might seem odd.

      The fiscal cliff was designed to scare Democrats into cutting Social Security. The cuts target blue districts despite abundance of government spending in red states. Obama had a deal with Boehner, but Obama wanted SS “reform” which the GOP is too scared to do anymore because of their dependence on seniors and boomers. They learned their lesson, and most Democrats won’t touch something which opposes the Dems signature selling point so soon after the GOP made a public push.

      This is an Obama Administration which has:

      -ignored financial fraud
      -ignored war crimes
      -created their own insane wars (doubling down and expecting to win in Afghanistan is the by-product of deranged and stupid minds; they did expect to win. Obama is that arrogant)
      -the first Administration since the Budget Act of 1924 to just not comply with the law by not sending a budget to Congress. Bill Clinton sent budgets when he was being investigated for what Democrats would consider to be sexual harassment if Bill wasn’t a Democratic President. Even the Newt government shut down was an argument over changes to Bill’s proposed budget, not some 90’s version of the Ryan plan.

      The Administration is a hodgepodge of the lazy, sociopaths, idiots, and people with their heads so far up Obama’s ass they can’t get oxygen to their brains anymore.

  16. NYPD pigs

    “less obviously thuggish,” I dunno, considering Dimon and Blankfein bought the 90 IQ animals of the NYPD pretty cheap and got to crush occupiers with cruel, inhuman and degrading treatment that Egyptian police would admire: sexual assault, torture with restraints, arbitrary use of pain compliance. Our banking kleptocrats are inseparably tied into an institutional hierarchy with the Gun Fighters, the Footprinters and other gangs (yes gangs – think Hell’s Angels with complete criminal impunity and steroids instead of meth. Scum of the earth, hired as capos.)

  17. SCyankee

    Apparently we are all more than aware of the FACT that our entire political, economic and social systems are utterly corrupted by oligarchs and plutocrats. It’s also more than apparent that they aren’t even breaking stride in furthering their plundering and are utterly unafraid of we, the people.

    1. Nathanael

      And therein lies their weak point. Those who are unafraid will fail to make the adjustments necessary to stay in power.

      (Unfortunately, the power vacuum will most likely be seized by significantly smarter oligarchs. I can live with that, but I’d rather have a functioning social democracy.)

  18. F. Beard

    “But in addition to these clear cases of death by bank …” Yves Smith

    There is World War II, a (the?) major cause of which was the Great Depression which in turn was caused by the banking cartel, which killed 50-86 million human beings.

    “Confucius said that the beginning of wisdom was learning to call things by their proper names.” Yves Smith

    Such as calling the banks a “government-backed usury for stolen purchasing power cartel”? Which they are?

    And there’s no excuse for tolerating such a thieving (not to mention dangerously unstable) endogenous money creation system since common stock is an ETHICAL form of endogenous money invented around the same time as central banking.

    1. Klassy!

      I looked that up not being familiar with John Harington. He invented the flush toilet too!

    1. from Mexico

      Hobbes was right about what?

      He was a royalist and a monarchist and was a loyal employee and apologist for this class his entire life.

      He was a materialist whose Calvinist notion of absolute predestination informed a determinism which left no room for human will or freedom.

      He billed himself as an empiricist, but his anthropology and political science is based upon a notion of man as a self-interested, radical and absolute individual which has almost no basis in experience. Quite the contrary, we are all members of families, tribes, villages, or cities and most remain part of communities. We have children, parents, friends, and loved ones whom we trust not merely with our wealth but with our lives. Moreover, there are many for whom we would sacrifice our fortunes and even our lives to save or to assist them in significant ways.

      Hobbes notion of man as the brutish savage locked in a war of all against all has about as much basis in reality as the Garden of Eden, and it would be difficult to find a worse — or more authoritarian — dead end than this.

      1. Myshkin

        “Hobbes notion of man as the brutish savage locked in a war of all against all has about as much basis in reality as the Garden of Eden, and it would be difficult to find a worse — or more authoritarian — dead end than this.”

        Really, it sounds disturbingly familiar. Where is he wrong?

        And by the way, I’ve noticed that the members of tribes, families and villages are as often as not at one anothers throats as they are co-operating.

        Still, nice hear a fervent note of optimism from Mexico

        1. Foppe

          He is wrong in that he suggests that egotistical motivations are the primary (and only) motivators; if you start from the admission that different people are motivated by different motives at different times, your whole story about there being a need for a sovereign (because if there isn’t such a thing, society will come undone in a matter of minutes) become a lot more problematic.
          As such, try to be a little less condescending when you next encounter “optimistic notes from Mexico“…

          1. Myshkin

            I read a Leviathan long ago and though I don’t remember much, elements of it rang true about how humans handle their affairs and the relation between the state and the individual.

            Hobbes’ view of human nature can not be simply summed up as being comprised of, “Egotistical motivations …” His admonition to, “Know thyself,” is not a bad starting point and not an easy one. It suggests Hobbes believed that evaluating human motivation to be a tricky affair.

            His political philsophy was of its time and therefore limited but its turn toward science was not entirely wrong and the ongoing debate about the rights of man followed from his investigation of the validity of state authority over the individual.

            As for being condescending, I wouldn’t presume to be but an out of hand dismisal of Hobbes is ridiculous and unexpected from Mexico. The sentiment about altruism and the brotherhood of man caught me by surprise, not something I associate with the occassional posting of his (or hers)that I run across on this blog.

            My observation is that humans are capable of extraordinary actions that range from selfish and savage to generous and loving but watching events unfold around the world over the years has led me to be less hopeful as from Mexico about the better angels of our nature.

          2. Foppe

            The problem is that while Hobbes had read his Plato (“know thyself”), his main inspiration was Thucydides. Consequently, while I’m sure he had stuff to say about other motivations, he did suggest/assert ‘fear of violent death’ to be the primary motivator (rather than to call it the primary motivator in situations in which one was reasonably feeling threatened) underlying all our considerations, especially those on the political front. If you accept this view, it means that you accept that a., the primary function of the state is to fight “threats” to the continued health of the state (this should be the population, but as should be obvious, existential threats to an entire “people” are few and far between); and b., that “the state” has the right/power to identify threats to its continued survival, without anyone really having the ability to contradict it.
            Whatever else you may think of Hobbes, that’s a frightfully limited view of the role of the state, as well as a frighteningly reactionary one, which leaves little to no room for working together constructively on shared projects within it.

          3. from Mexico

            Myshkin says:

            His political philsophy was of its time and therefore limited but its turn toward science was not entirely wrong…

            Phew! You have really drank the Modernist Kool Aid.

            Hobbes attacked Descartes arguing that Descartes had established his science upon a faulty foundation by positing the I as fundamental. The I and the whole subjective realm in this view are merely permuations of matter. Humans are therefore no more than mere bodies of matter in motion. Consequently, there is no free will. Human beings, like all other beings, are governed by the laws of matter. The supposedly free will is in reality only the last impulse before motion.

            Hobbes’ absolute materialism thus reduces the human condition and human existence to a complete monism, always being secular and horizontal in its references, and eliminates any possiblity of a vertical, spiritual, moral or ethical self.

            Descartes, even though the role of the subjective is not denied in his science or his anthropology as it is in Hobbes’, nevertheless limits the appropriateness of scientific inquiry to the physical sciences. Descartes’ system of science thus included only an abbreviated anthropology (The Passions of the Soul) and did not include social or political science. Hobbes, on the other hand, extended his sweeping and all-emcompassing system of science to include anthropology, social, and political science. Thus there is a deep connection between theology, politics, and science in Hobbes’ thought.

            Hobbes came to the conclusion that through our sense perceptions and experiences we can achieve a veridical knowledge of and “know” the external world.

            We know now that this was a rather fantastic and totally unrealistic expectation. The way empiricism works in reality, in all but a very few number of instances, is as follows: The human mind comes to affectively-valenced intuitive judgments in miliseconds by means and mechanisms which we have amost no understanding of, and then goes out and searches for evidence that confirms these judgments. So essentially, what Hobbes “science” boils down to, and this is espesially true when it comes to his anthropology, political and social sciences, is making up post-hoc explanations for whatever was decided earlier for subconscious reasons.

          4. from Mexico

            Myshkin says:

            …the ongoing debate about the rights of man followed from his investigation of the validity of state authority over the individual.

            Now you’re putting your authoritarianism on display. There are not many political theories more authoritarian than Hobbes’ when it comes to justifying the legitimacy of the authority of the state over the individual. According to his anthropology and his political science, man sacrifices his individual rights in order to avoid the “war of all against all,” as wiki explains:

            The first modern philosopher to articulate a detailed contract theory was Thomas Hobbes (1588–1679). According to Hobbes, the lives of individuals in the state of nature were “solitary, poor, nasty, brutish and short”, a state in which self-interest and the absence of rights and contracts prevented the ‘social’, or society. Life was ‘anarchic’ (without leadership/ the concept of sovereignty). Individuals in the state of nature were apolitical and asocial. This state of nature is followed by the social contract.

            The social contract was an ‘occurrence’ during which individuals came together and ceded some of their individual rights so that others would cede theirs (e.g. person A gives up his/her right to kill person B if person B does the same). This resulted in the establishment of the state, a sovereign entity like the individuals now under its rule used to be, which would create laws to regulate social interactions. Human life was thus no longer “a war of all against all”.

            Again, like I said above, it’s obvious to all but the most doctrinaire of authoritarians that human beings are hyper-social animals. But nevertheless, the fictions created out of whole cloth by Hobbes remain part of our ruling mythology because they serve the interests of monarchs and oligarchs.

      2. Jim

        An alternative interpretation of Hobbes was that he was an aristocrat who made an aristocratic case (through the application of his own privileged rational faculties) for the limitations of reason.

        If the passions are viewed as being subordinate to reason then one has created a foundation for validating a hierarchical inegalitarian ordering of human beings. However, instead of the passions being subordinate to reason—Hobbes conceived or reason as being subordinate to the passions.

        With this argument Hobbes, seems to implicitly embraces a vision of radical human equality since reason is a set of capabilities that is differentially distribute among human beings whereas the passions usually refer to a common set of vulnerabilities, such as our capacities to experience pleasure and pain.

        If what makes us authentically human is our mutual capacity to feel (such things as joy and suffering) rather than our differentially distributed capacity to think—then Hobbes has helped to develop a focus for justifying greater and greater equalization of human societies.

        Ironically, the aristocratic Hobbes offered us a perspective which found expression in successive waves of equalization that characterized emerging liberal societies—until our modern knowledge professionals consolidated their own powers in our modern State through an alliance with predatory Capital.

        1. from Mexico

          On the rationality vs. empiricism divide, Hobbes most definitely fell on the empiricism side, and so he attacked rationality. But I’ve never run across anything that indicated that “Hobbes conceived of reason as being subordinate to the passions.” Quite the opposite, his entire political science was built upon universalizing and legitimizing our one passion that overrode all other passions –the fear of violent death — and promoting the use of reason to minimize or eliminate it. Hunger, lust, thirst, and wonder all disappear in the moment we are confronted with a threat to our lives. This is the meaning of Hobbes’ claim that the wellspring of human action is the fear of violent death.

          Some Hobbes scholars see a disjunction between his natural science and his political science. Leo Strauss, for instance, argues that Hobbes developed a mechanistic science on a radically new foundation but that he was unable to explain human beings and political life mechanistically and fell back on a vitalistic account more characteristic of humanism. Strauss sees Machiavelli lurking behind Hobbes’ political science, but he sees this disguised by the scientific veneer. Quentin Skinner argues that Hobbes in the Leviathan resorted to rhethoric. Noel Malcom says that Hobbes in his political science abandoned analysis and adopted construction. But I’m not sure these are widely accepted views. Most scholars more than likely accept Hobbes’ claim that his political science follows from his natural science.

          Are you sure you are not confusing Hobbes with Hume? Hume, in A treatise of human nature, wrote “Reason is, and ought only to be the slave of the passions, and can never pretend to any other office than to serve and obey them.”

          Human beings in Hobbes’ view are basically equal because they are equally mortal. No one is so strong that he cannot be killed. No one is immune and therefore exempt from this fear. Agreeing to the Leviathan, like Machiavelli’s prince, is the only way to keep oneself safe from being killed.

          1. different clue

            How would Hobbes have accounted for people who feared being humiliated more than they feared the violent death needed to make very sure they were preventing their own humiliation?

          2. Jim

            In Part I Chapter 8 of the Leviathan Hobbes states:

            “For the thoughts are to desires as scouts and spies to range abroad and find the way to the things desired.”

            Both Hobbes and Hume agreed that the reasons generated by reason are largely concerned with clarifying the ends to which are passions are driving us.

          3. JTfaraday

            “people who feared being humiliated more than they feared the violent death”

            No one who fears humiliation more than death itself is going to rush to jump on this thread, LOL.

            Here are two recent entries in the Meaning of Hobbes (and the future of civilization) p*ssing contest from the past several years, just off the top of my head:



            You’ve got to get up really early in the morning to beat this one.

  19. Klassy!

    I guess it is the same reason that no one speaks of America’s Criminals.
    America’s criminals are all of the blue collar variety. There is no qualifier needed. They’re just criminals.
    When “white collar” modifies “criminal” you are supposed to believe “they themselves didn’t actually hurt anyone.” In reality, it is more like the Russian style murder as described above– except with a lot more letters in the chain, and a lot more victims.
    Of course, even the delicate term “white collar criminal” is not often used. And when it is, it is most often applied much further down the food chain– certainly not to our elites.

  20. Anonymity_Agent

    Still very curious as to how banks and their “regulators”, no wait, lets just call them for what they are. Federal embezzlers and larcenists can legally excuse the receipt of billions of dollars of bailouts that covered the loans, followed by the securitization of the loans that reaped billions more from honest investors, then foreclosure on many borrowers, and resale for billions more.

    Where is all the money?
    Its in Jamie Dimon “portfolio.”
    Its being burnt on private jet engine joyrides to g-7 summits to discuss amongst other things, how to try to screw over millions of other honest people using bought slaves in the regulatory puppet show that is the Occ and Fed.

    And hwo does the Dept of Justice call themselves an institution upholding the law while this happens, repeatedly?
    Occasionally, justice is served.
    Lets see if any of these regulators and lawmen are anything more than impotent tools who cant stand up against a petty street thug like the snakes from the global exchange cabal.

  21. Jim

    “The time is long past to kid ourselves about the nature of the ruling class in America and start describing it accurately, as an oligarchy.”

    Is modern U.S. State power any longer a defender of popular class interests against private predatory oligarchic capital?

    Is modern U.S. State power now as predatory as the power of Big Capital and Big Finance?

    Is modern U.S. State power increasingly run by predatory professional technocrats who use their cultural capital (knowledge) to secure a privileged position within public bureaucracies of various sorts and then go on to align themselves with the predatory private sector oligarchies and their predatory professional allies in the private sector?

    1. Nathanael

      Frankly, the CEO class kleptocrats deliberately push to get specific careerists (the agents of the kleptocrats) into the bureacracy and running things.

      The best description is that the CEO class has corrupted the government.

  22. Ken Ward

    I don’t recall that Johnson defined ‘oligarch’ in either his Atlantic Monthly article or his and Kwak’s 13 Bankers. In the quotation from the former that appears in Yves Smith’s post, he confuses the issue by referring to various countries’ ‘captains of industry’. Are all captains of industry oligarchs? In short, Johnson’s discussion of oligarchy rests on a very insecure sociological basis. And what is Yves’s definition of ‘oligarch’ and ‘oligarchy’? How long has America been or had an oligarchy? Was it an oligarchy in the days of the Robber Barons and, if so, did it remain an oligarchy or cease to be one, only to become one again more recently?

    1. Hugh

      I can only assume you are an alien recently arrived on our planet and completely unfamiliar with the history of the last 35 years. So on behalf of all of us earthlings: Greetings!

      Oligarchs refers to people of exceptional wealth who use that wealth to subvert the political system in order to benefit their interests and increase both their wealth and power even more.

      I prefer the term kleptocrat because it brings in the ideas of criminality and looting. As I have written in the past, kleptocracy is both a system and a class phenomenon. In class terms, it is comprised of the ruling rich and a servant class made up of the elites. These will compete with and loot each other if they can but primarily predate on the rest of us in the 99%. In terms of a system, kleptocracy takes over control of all public institutions: Wall Street, the government (executive, legislature, judiciary, regulatory bodies, etc.), academia, and the media to defend, maintain, and expand looting.

      I have used the example before, but I once was present at a talk by a psychiatrist discussing the symptoms and diagnosis of various personality and emotional disorders. The audience became a little uncomfortable as they realized that many of the symptoms described could be applied to themselves or people they knew. One person finally asked about this, and the psychiatrist replied that while many have a trait, very few have the disease. From the inception of the country, we have had the traits for oligarchy and kleptocracy and at various points in our history these have been more pronounced than at others. But in the last 35 years, we contracted the disease.

      We have been through the history of the last 35 years many times here and I will not go through it again. But if you come here much, you will no doubt pick up the various bits and pieces of it in the discussions.

      1. Warren Celli

        Hugh said; “I have used the example before, but I once was present at a talk by a psychiatrist discussing the symptoms and diagnosis of various personality and emotional disorders. The audience became a little uncomfortable as they realized that many of the symptoms described could be applied to themselves or people they knew. One person finally asked about this, and the psychiatrist replied that while many have a trait, very few have the disease. From the inception of the country, we have had the traits for oligarchy and kleptocracy and at various points in our history these have been more pronounced than at others. But in the last 35 years, we contracted the disease.”

        Yes Hugh, it is a disease, a disease that affects one’s morality, and the disease has a name, a name that describes well those infected by it, and yes the disease is contagious. The disease is called Xtrevilism.


        As a descriptive term, for the less than one percent aberrant diseased psychopaths that now control our futures, it is far superior to; oligarch, elite, or even effing gangster, as it puts the focus not only on the criminality and looting involved but also on the aberrant depravity and evil. It also allows one to more gently point helpful fingers, not with name calling malice in mind, but rather with a more altruistic motive that will effect the same end — clawing back stolen wealth and institutionalization of the diseased sickos. To help them get well of course.

        And yes again, the characteristics and traits can be applied to many people. When you see them in yourself you SHOULD feel uncomfortable as you may very well be contracting the disease. If you see the traits in yourself but don’t feel uncomfortable than the odds are pretty good that you have already become infected.

        You can view the characteristics here…


        Deception is the strongest political force on the planet.

      2. Ken Ward

        Thanks for your greetings and the alluring prospect you hold out that this alien will pick up ‘bits and pieces’. I pointed out in my first post that neither authors I referred to had defined ‘oligarch’ or ‘oligarchy’. Your providing a definition doesn’t change this.

        1. patricia

          Ken, it took 15 seconds to pull this down from post:

          “Now Johnson carefully laid the bread crumbs, but so as not to violate the rules of power player discourse, pointedly switched from the banana republic term “oligarch” to the more genteel and encompassing label “elites” when talking about the US (“elites” goes beyond the controlling interests themselves to include their operatives as well as any independent opinion influencers).”

          We use dictionaries as a basis for definition of words. It took another 30 seconds to copy this one:

          ol·i·gar·chy n. pl. ol·i·gar·chies
          1. a. Government by a few, especially by a small faction of persons or families. b. Those making up such a government.
          2. A state governed by a few persons.

          Assuming that you’re a bewildered alien is more courteous than diagnosing you as deliberately obtuse.

    2. Chris Engel

      The base definitions of oligarchy have been set out by the Greeks.

      Essentially it’s rule by the rich few, promoting policies that maintain or grow the wealth of the oligarchs themselves, directly influencing and conducting policy.

      Are you unaware of the deregulation that has occurred since Reagan? Under Clinton?

      Are you unaware of the change in the tax system which has given an advantage to capital-owners and high-income earners?

      Are you unaware of the role of money in overtly influencing policy in the modern day? Or how it has been used indirectly as well in the past?

      Do you realize how special interests infest the legislative process, where banks, energy companies, gun manufacturers, insurance companies have re-written the laws that we the people implemented to extract more rents and perpetuate their growth in wealth?

      There’s a difference between an oligarch and a wealthy entrepreneur. I’d say guys like Buffett and Gates aren’t really oligarchs. Instead it’s people like the Koch brothers and those who manipulate state-level races or use so much influence in K Street to write regulations and force neo-liberal narratives down our throat which have only perpetuated inequality.

      It’s hard to really find a point where the modern societal structure is NOT resembling an oligarchy. The rich are running and influencing policy, and ignore the poor and the agenda is all about dismantling and privatizing public services. This is classic oligarchical conditioning.

      And you apparently have a poor grasp of American history as well.

      You mention the robber barons, but don’t seem to address the populism that arose from the Gilded Age. Of course we’ve had an oligarchy, and we’ve dealt with it. And it has arisen again. And we must deal with it again. They rigged the system, we need to unrig it, and take back our country. Because we’re not a business, we’re a nation.

      Instead of getting so caught up in the semantics maybe you should address the reality of how legislation is passed and how agendas are pushed in DC and why every single congressman is rich.

  23. VietnamVet

    Money has always talked; now it dictates.

    The following is our recent history that is not discussed by corporate media;

    1) The wage inflation of the 1970’s was broken by privatization, outsourcing and union busting. This continues in full force with President Obama about to sign the Sequestration Bill that will cut 13 to 22 days from federal employees pay between now and October.

    2) The USA fights wars to make money for the rich not to win.

    3) Banks and corporations now control the US government. Financial crimes are only prosecuted against those who steal from the Autocrats. Jon Corzine will never be indicted for stealing 1.2 billion dollars from American farmers.

    4) The Oligarchy has completely forgotten the Russian and French Revolutions. Also, people need jobs to create demand.

    5) The era of cheap energy ended at the beginning of the 21st century. The human population needs be cut in half in order to survive on the earth:

    The Euro crisis and 17% real unemployment in the USA are all a result of bouncing up against resource limitations and the “Get it while you can” ideology of the wealthy.

  24. Hugh

    Excellent post. Kleptocracy kills. Those who profit from it or serve it (the rich and elites) are murderers plain and simple. I like the idea of reclaiming our language so that it becomes an instrument of clarification and not obfuscation and distraction.

    Kleptocracy is a worldwide plague. Various regions and blocs may have their own particularities but overall the rich, be they Russian, Chinese, US, or European, are pretty much the same. They are all criminal and culpable for their theft and looting with all the death and misery these bring.

    This is what we have to understand: at some point we have to say enough is enough. Anymore is theft from the rest of us. You can choose your own figure, the one I use is $20 million. Can you think of anyone in this country whose contributions to our society come remotely close to this amount? I can’t. Yet by today’s standards this would be considered only a modest fortune. Our society’s resources are finite and so all the oversized, unwarranted fortunes far in excess of $20 million represent a taking from the rest of us. Not only that but they encourage criminal behavior, the corruption of the political system, and the destruction of the rule of law. In short, great wealth is unearned, undeserved, and harmful to us as a society. We see overwhelming evidence of this everyday. It will destroy us if we do not destroy it.

  25. ltr

    I have been showing around this post, and every person who reads it is impressed and surprised after all the stereotypical nonsense they have heard.

  26. john c. halasz

    Let’s not forget that those Ruskie robber barons were the result of the looting of the F.S.U. economy in the wake of the “shock therapy” imposed on the F.S.U. by the IMF and the U.S., one of the greatest economic catastrophes in modern history. So it’s a bit, er, rich, for neo-liberal authorities to be stigmatizing shady Russian business practices.

    1. Chris Engel

      The Western media almost idolize the American oligarchs, who talk about their numbered accounts in the Caymans or Switzerland, and evade taxes while gaming the system because they’re shrewd capitalists that we ought to strive to emulate. And these astute “outsourcers” who “innovated” globalization trends that cost American jobs…it’s all a silly image and populism is dead in the US. Especially when Obama is supposed to be the “change” candidate of the people, yea right. Even with a supermajority and all three branches controlled, the Dems and Obama “rammed through” a healthcare plan that was a carbon copy of the right-wing dream of a big government handover of $ to private insurance and other stakeholders in the medical industrial complex.

      But some Russian guy who wants to sock his savings away through a popular offshore banking center? Let’s label him an oligarch automatically. Because they’re Russkies, you can’t trust ’em, right? No such thing as an honest buck over in Soviet land…but a dollar earned is always done with great honor and virtue!

      1. DANNYBOY

        The Western media sucks. The end.

        Also, when my opinion of the US Predation started getting darkened, I was able to make sense of it all by conjuring up that image of the USSR that had been propagandized during the Cold War..and applying that image to the US.

        So, all that propaganda that I had resisted, did go to good use.

  27. JamesW

    I was amused when Chris Hayes made some negative remarks on air about the U.S. military and was forced to walk them back.

    Not me, buster, I haven’t been amused by Hayes ever since he wrote that fraudulent and phony piece proclaiming the “NAFTA Highway” to be so much “conspiracy theory.”

    (With the information derived from then-readily accesslbe web sites of the Council on Foreign Relations, the Indiana Chamber of Commerce, Illinois Chamber of Commer and the US Chamber of Commerce, Hayes was really blatantly dishonest in his piece, for which he was handsomely paid through an offshore account.)

    No, Hayes and his type are the bought-and-paid-for lackeys, and to suggest otherwise is to be a moronic consumer, instead of a courageous citizen!

    Read Lance deHaven-Smith’s Conspiracy Theory in America for a more enlightening take on how we arrived here.

  28. allcoppedout

    Oligarchs tend to rise in most economies beyond the relatively murderous and egalitarian primitive ones. They seem to enslave many in useless and pathetic projects like pyramid and terracotta army building. There are countless forms of this parasitism in biology and I doubt the rich are generally much use to the rest of us and probably a massive drain, certainly doing none of the real work Dork of Cork describes. Hobbes had no biology and I wonder why another would bother discussing what he meant ahead of what modern biology can tell us.
    I haven’t heard the term oligarch used about the rich in the UK or USA. Our media no doubt put over the idea they are damned fine chaps. I don’t think we understand how they come to ‘rule’ at all because we allow our thinking to be trapped in fairy tales on leadership. Allegedly leftish parties are doomed because they play the leadership game. We fail to look hard enough at the evidence – huge surveys show that investment funds that take bigger fees are the worst for investors, that the ‘alphas’ really make no alpha and so on. Frequency distribution does tell us there are some winners – the explanation is probably luck, insider trading (etc.) followed by passive investment of the wad. My guess is we should shoot all the oligarchs just to see what happens (I know just seeing them die would be enough for some). In animal experiments they are replaced soon enough (elephants are a notable exception). One suspects they are entirely replaceable and thus should come cheap, not expensive as they always claim. In animal experiments the new boss is just like the old boss – this does not have to be the same fr humans.


      Nice timing on the reference to Pyramid Building. I’ve been reflecting on that today (and you know why).

      Those early Predators were forced back by pestilence, locusts, death of first-born sons etc. Today I was thinking that these would be appropriate measures to be dealt Today’s Predators. But I don’t have the juice.

      But then wait, I read your words and what do they say: “we should shoot all the oligarchs just to see what happens (I know just seeing them die would be enough for some). In animal experiments they are replaced soon enough (elephants are a notable exception). One suspects they are entirely replaceable and thus should come cheap, not expensive as they always claim. In animal experiments the new boss is just like the old boss – this does not have to be the same fr humans.” Now here’s an idea that resonates with my (at least with my soft-side).

      So, how to proceed? Richest first?

      I’d love to see the look on the face of the second richest guy. I’ll bet he stops bragging about his wealth. I bet he even gets his bought-media to stop touting his superiorness.

      1. Nathanael

        Pyramid building was better than what our current kleptocrats do.

        It’s worth understanding the economics of ancient Egypt. 3/4 of the year, there was a massive amount of work to do in the fields, and a huge surplus of food. 1/4 of the year, there was no work and no food.

        The Pharoahs offered people *steady* employment. The pyramids were make-work projects for the 1/4 of the year when there was no food being produced. The Pharoah’s primary job was to produce a large enough surplus during the 3/4 of the year when food was being produced, to feed Egypt’s burgeoning population in the other 1/4 of the year. And to store that surplus. And protect it from the short-sighted. And store a large enough surplus to deal with bad harvest years.

        On the whole, when the Pharoahs actually succeeded at this, people were pretty happy with the system, whether they were doing make-work pyramid building or working in the fields: because their food was assured by the government. When the Pharoah failed at feeding everyone, he was overthrown.

        Our kleptocrats are NOT guaranteeing everyone a job and are NOT guaranteeing everyone food. Please note the critical difference. Our kleptocrats are *crazy*.

        1. DANNYBOY


          The Passover Haggadah we read last night tells the story differently. There seems to have been some strife between Pharaoh and his Jewish slaves.

          Your reference to: “The Pharoahs offered people *steady* employment.” and “people were pretty happy with the system, whether they were doing make-work pyramid building or working in the fields” doesn’t jive.

          But I’m open to any version of history you like to believe.

          1. Nathanael

            The Passover Haggadah is a myth with very little historical evidence behind it. One concocted by people a very long time and distance away from Egypt.

            I’ve been studying *actual* ancient Egypt. It’s very interesting. It was one of the most stable societies in history. This is because:

            (1) It had a huge agricultural surplus — three, sometimes four harvests a year!
            (2) The government was generally acutely aware that their job was to make sure everyone got fed. One year of food shortage and the government would get overthrown.

            The story of Joseph in the Bible (seven fat years and seven lean years) actually does relate to the sort of things the Egyptian governments obsessed about.

          2. Nathanael

            The stable Egyptian society started sinking when the Romans took over and started exporting the agricultural surplus to Rome (and Constantinople, and so on). The country never really recoverd.

          3. Nathanael

            For what it’s worth, the ancient Egyptians often didn’t treat people perceived as “foreigners” or “non-Egyptians” very well; the description I’ve given is really about how they treated *Egyptians*.

            Sadly this is true of most societies. Tribalism, racism, xenophobia run deep. I don’t think you can honestly say that the US has ever treated people perceived as “foreigners” well.

            So it’s quite possible that the stories of Egyptian abuse in the Bible related to that.

          4. Nathanael

            Anyway, my initial point is that pyramid building served a useful social purpose, akin to some of the less useful WPA projects: they kept people employed.

            It’s quite clear from the records that this was the primary reason for it. As a king, you don’t want a gigantic population of bored people with nothing to do. Keep ’em busy, and why not have them put up monuments to you while you’re at it? The work was designed to maintain the same organizational system as, and similar workloads to, the agricultural work done during the other 3/4 of the year.

            In contrast, our current kleptocrats are not making any effort to keep people employed. If they were, it would be kind of obvious.

  29. Claudius

    I have attempted to post a substantive comment for a couple of days now on the secrecy aspect of the financial centers – to no avail both on this post and on the “repeat after me..” post.

    Additionally so, today, on the ‘European growth’ post. To no avail. Highly frustrating as I have tried every suggestion in Lambert’s ‘General guide’ (see frustration comment on ‘repeat after me..” Any ideas?

    1. Chris Engel

      No suggestion to help except that Yves and Lambert should let regulars just post freely without going through a broken system.

      I know spam is a problem, but there has to be some solution.

      1. Claudius

        Odd that I can post short comments, but nothing over two paragraphs or so. Wonder how many potential comments are being lost to NC readers, and how many commentators just give up, abandon the ‘Submit Comment’ fight and vent their spleen elsewhere.

      2. Lambert Strether

        Chris, Claudias: See the current iteration of my standing comment on comments, including the first sentence.

        * * *

        “Let regulars post freely” (that is, without algorithmic intervention) amounts to a suggestion for a comment “white list.” Unfortunately, the comment white list plugin I’ve looked at hasn’t been maintained in two years. Also, it’s not clear to me how to maintain a list of “regulars” without constantly contending with demands to be put on the regulars list. I wouldn’t be that good at managing the velvet rope into the club, assuming there should be one, and it’s hard for me to see that Yves should be spending time on administrative chores instead of writing.

        1. Claudius

          Agree. No one, least of all Yves and your good self, should waste time on administration when you have something to write and say.

          But, I would adopt the same courtesy to commentator and contributors too who, also, want to waste least amount of time figuring out the incomprehensibility of not being able to, simply, cut-and-paste ‘txt’into the comment box.

          As you know, few things are more frustrating than not being able to say something ,when you have spent time and effort on something to say.

          1. Yves Smith Post author

            The problem is that the spam filter (which we did not set up, it is some sort of WP tool) has MORE comments in it, 50% more, than the comments that appear. So if we take THAT down the comments section rapidly becomes garbage.

            Yours was in the spam filter. This has NOTHING to do with rules Lambert or I control. I did approve them, which may help with future post attempts. Sorry because I do like your comments!

            Too many links are a spam flag, BTW. As are really long comments, which yours were. Your IP indicates a foreign address which makes you sus, and you use different (fake) email addresses every time. Fake is tolerated, different all the time probably adds spam points. Trying to post multiple times after your comment is caught in the filter will NOT work and also may increase your spammer points.

          2. Claudius

            Thanks for your comment Yves.
            Having read your (spams’) ‘ sus’ profile of me, I appreciate the concern.

            If it helps other frustrated commentators, I believe I’m typical of my age/generation (nothing nefarious) in that, for profile:

            • Weekdays, I typically comment using my Android phone only (during the/a commute).
            • I use an IP emulator and fake email generator and ID stripping ap’ for web forms – for both security, anti-spam (anti data warehouse) btw. Not just for NC.

            • Home I use a personal PC that has ‘no script’, IP emulator and fake email generator for web form for the same purpose.
            • I never use office PC for anything other than work (May as well shout from one’s office).

            However, if NC has/had a secure registered user subscription/membership, I’d be more than happy to use a dedicated e-mail and fixed IP.

  30. Ms G

    This post zeroes in close to the marrow, and there have been several incisive posts articulating the urgency of our circumstances.

    After clarity, comes action.

  31. Francis

    The oligarchs are so powerful that we can write about them all the time and nothing happen. It’s the Goebbel’s dream, the Orwell’s nightmare and we’re living it.

  32. skippy

    Oligarchical pleasure time out… the demands of station do take a toil… don’t ya know… HeartPlug tm


    Skippy… you are so beautiful my Baron…

    PS. everyone in the 99% should get the HeartPlug tm prosthesis… show your fidelity!… hell put a lanyard on it… next time the mob (simple minded morons) goes walkies in protest… and – insert you local oligarch – personal guard shows up… point out the ***Pull Here*** placard on the end of the lanyard… this display of fidelity in mortem… should tickle (pleasure) them so much… they won’t whack off the hole mob… just saying…

  33. rob

    This is a great topic.
    I think the term oligarch, ought to be used by anyone ,whenever we can.where ever we are.we all know the press,and the historians won’t.

    In my mind, oligarch;is the new kid on the block.These are people who have assumed control of something, and still have it.Meaning they are still alive.The first generation, or even the connected living generations,of a fortune/syndicate.These would be people like ruppert murdoch,john paulson,dimon,corzine,singer,bloomberg,gates etc.These people run hedge funds,pe firms,large monopolizing concerns.These are the “vultures” in what greg palast details in vultures picnic, or how to steal an election.They are people who still have their hands on the controls they have amassed.But, these people are just one group of those we must defeat.
    When people speak of bader meinhof, or other violent reactions;they leave out the part that these groups themselves become the pretext for the state to clamp down on the people even more.Cops, need criminals.The war racket dept, needs terrorist.the security state needs people willing to go along with their informants and commit acts of attempted or actual acts of violence.We have to be smarter than that.ghandi,king;they knew the ultimate power, while they were facing an adversary concerned with their public image.Obviously, If ghandi tried that shit with stalin, ghandi would have died.period.we are living in an absolutely corrupt world, wherein the inhabitants don’t know it,not really.If they ever wake up, and choose the right thing, oligarchs beware.But that ain’t about to happen either.
    we shouldn’t confuse the oligarchs , with their bagmen. These are the guys who run the corporations, and don’t really care how they get the numbers up.. their job is to get the numbers up.These are the strawmen, wisely placed before the mobs of villagers with their pitchforks infuriated about financial crimes,or global pollution, or resource depletion,or labor exploitation,or political manipulation,or media complicity,or whatever we ought be dammned mad at.But these bag men are a dime a dozen. and hanging them all might make many people feel better ,at first, then the real players will appoint new bag men with less restraint.
    But we must also realize we are the feed stock to the old parasites.These are the old families. the establishment.
    the fortunes of families like astor,whitney,vanderbuilt,morgan,rockefeller,bush,cecil,rothschild,roosevelt,harriman,brown,dupont,etc.These families are divested due to time.The originals have died, their families have split up, and now are communities of intrest.When the wall st journal was being sold, the bancrofts came out of the woodwork.what?20 or 30 of them, together showing they owned the paper.The rockefellers now are some 50 people, many keeping that nice round number in their banks,1.1 billion..or so.back when the rothschilds were developing their empire. the five banking houses in europe,each for one of the sons, from the first who was banker to the holy roman empire,thru many generations.The first few generations all married first cousins so as not to “dilute” the family power… but now they do.Look at the cecil family, 100 years ago, they were the english empire. balfour,vice roy of south africa,india,ireland,appointed positions in canada,austrailia,etc.Or the whitneys,when one was pan am in this country, his cousin was british airways, and head of british aviation. Or the bushes and walkers and browns…It was something to see the divorce papers of niel bush when his wife wanted half of everything and she laid out claims to @five and a half billion dollars of assets not disclosed, which were properties hidden by holding companies owned by lawyers of his,on paper, of real estate in china/hong kong and all of which shows the iceberg of who really owns what in this world.Is china our problem, or rich brats who own dummy companies in china, who are our problem?
    These families are deeply interwoven to the fabric of our culture.Look at their foundations,these are not for charitable works, they are for keeping fotunes intact and under control as the generations pass , without taxation.buffet gave his money away, and what does he get. someone he wants ,or the next in line who has control of that money in perpetuity.These monies fund academia, they fund policy directives.These act as a hand, for the use of the other hand when needed.This shit is old.There were 2 jp morgans.the company began as george peabody &co in 1738.corporations are immortal.They are the beast of frankensteins.The oligarchs are dr frankenstein.We must fight them both…
    So ,long story short..
    lets pass something like the HR2990 of the 112th congress, to give the gov’t of the people, for the people something to fight with.
    Right now, the top 400 wealthiest americans, own as much wealth as the bottom 160,000,000

  34. Paul Tioxon

    Comrades, of course there are oligarchs, just not in Harvard or Wharton biz schools. Well, late to the party, at least you found the party.

    From The Socialist Monthly Review, MR:

    “They Plunder, or We Run a New Commonwealth
    by Charles Andrews

    The sky has been overcast for decades. Since 1973 the income, working conditions, and life prospects of common people in the United States have been ground down. In 2008 the storm arrived. A huge recession poured down sheets of unemployment, took away health care from four million more people, and pushed the carrot of retirement comfort five or ten years into the future. There is a heavy anxiety that floods are gathering somewhere up the ravine.

    American history has entered a new era. For almost 200 years after the American Revolution of 1776, capitalism operated to develop our productive powers. Oligarchs of wealth took most of the gains from the beginning. That’s the way capitalism works. Still, whenever common people put up a fight, they won something back for their labor.

    The oligarchy of the rich is taking it all back.

    Social Security was won in 1935. Today, a Democratic President sets up a commission of Scrooges pressing hard to cut it to shreds and privatize it.

    The real hourly wage is no higher now than in 1973; it takes both partners working full time to maintain a family at the standard one working parent provided 40 years ago; and the inequality of income has widened to a historic extreme.

    Medicare for people over 65, won in 1965, should be extended to everyone, but the oligarchy passed a law dictating that we must buy private health insurance.

    The political front men for the oligarchy of wealth have nothing to offer. The liberal contingent proposes ever-weaker versions of incremental reform, but nothing comes through, or it turns sour like Obamacare. The reactionary demagogues simply demand unbridled power for corporations, insisting with vigor and sophistry that corporate economic dictatorship will bring the good life.

    Politics follows the economic trajectory. It is now about what we lose, not what we gain. The economic system has no more room for substantial reforms. There has not been a wave of major change since the 1970s.”


  35. Claudius

    I attempted to post this on a previous (Repeat After Me….”) post. But, as Yves reverences the ‘secrecy’ aspect, it might fit here too.
    What’s the difference between a Tax Haven and a Low Cost Jurisdictions? Clue: it’s a secret.

    During the financial crisis, the US in particular and the G20, generally, understood that the key to tracking tax evaders and tax havens was transparency of information (not tracking nominal tax rates jurisdictions). As Such, the G20 obligated (to a degree) tax havens to sign bilateral treaties providing an exchange of bank deposit information in an effort to end bank (or more specifically, depositor) secrecy. Though, (as reader ‘Swedish Lex’ references, above) research by Shaxson (and Christensen) concluded that this resulted in only a negligible benefit – what, typically, happens is that rather than repatriate funds, tax evaders moved deposits to havens not covered by a treaty with their home country. The result is a massive capital relocation of deposits to the least transparent/compliant tax havens (making it even more difficult to track); even though the nominal tax was higher (tagging an additional ‘secrecy’ premium on the intermediation rates).

    So, how to lift the veil of depositor secrecy (domestic banks are, or course, easy targets) especially on cross-boundary (tax haven) transactions? The first point of attack might well be a primary source such as the BIS banking statistics, which contain information on foreign bank deposits in 41 countries. And, there, clearly has to be a data (transaction) trail in the financial system (which we know is robust, because money gets to where it’s going quite efficiently). For example, the BIS publishes quarterly data aggregated at the country level, showing total deposits held by, for example, US residents in Swiss banks and total deposits held by Swiss residents in US banks.
    All significant financial centers (low tax jurisdictions, havens and non-havens) report to the BIS. Why do they have to report to the BIS? Because all the banks with cross-border positions in excess of a nominal threshold (say, $10 million) are required to report it; and, importantly, the BIS statistics are used widely in global economics and as a national/international balance of payments indicator (which gives an idea as to the size of capital flows) and are key as an econometric indicator.

    However, what the banks do not report data on individual customers’ to the BIS, only aggregate figures as they relate to immediate beneficiaries. So, it’s not possible to know, accurately, what proportion of deposits in tax havens belong to individuals evading taxes and what belongs to, say, multinationals. It’s a best guess (and for too many ‘wonkish’ reasons it’s not easy to model either). And this is where the degree of secrecy as to whom/what is an immediate beneficiary and whom/what is a ultimate beneficiary carries a premium. Almost a quarter of all deposits in tax havens are registered as belonging to other havens, reflecting the widespread use of shell corporations by clients of offshore banks. And, Jurisdictions such as Delaware and Panama stand out because both jurisdictions have very flexible incorporation’ laws that make it simple to create companies in a few minutes (as highlighted in the exchange by readers Jim Senter, Peter Pinguid Society and Ms G, ” Repeat After Me….” post).

    For example, Switzerland, the second largest offshore center in terms of “non-bank” deposits, the best guess is that 80-90% of the deposits seem to belong to individuals (easily recognized as ‘immediate’ beneficiaries), whereas, say, the Cayman’s has a higher proportion of multinational deposits (ultimate, ‘secret’, beneficiaries). This might explain why the US/OECD found it easier to go after Switzerland first place (rather the Cayman’s or Delaware); with its high ratio of immediate beneficiary deposits. And, to some degree explains the league table to which Yves refers; though t’s not the entire secrecy picture.

    Because while The Cayman’s too reports to the BIS “immediate” beneficiary deposit owners (it’s shell companies) it, like Switzerland, reports nothing about (real/ultimate) “beneficiary” deposit, ownership – such that, if a US citizen owns a Delaware deposit through a shell corporation with an address in Singapore, the BIS assigns the funds to Singapore, and Delaware remain invisible.
    Using a shell corporation as nominal account holder puts a “real” layer of secrecy between an account and its beneficial owner; essentially, accounts held through shell corporations are equivalent to a numbered account (which are now ‘verboten’ by OECD countries – Switzerland being oh so 2008 and, stereotypically, your classic go to “secret” account); but ask the Cayman’s and, though very reluctantly, they will tell you something (though because of the shell accounts, actually, they’ve told authorities nothing useful); thus placing them in a better position on the ‘secrecy’ league table. This might explain why Switzerland is high on the ‘Financial Secrecy Table -because they are really reluctant to tell BIS or anyone anything at all, and actually reveal (its higher proportion of) immediate beneficiaries. In many ways, Switzerland is actually the poor-rich man’s banker.

    An astute observer might point out that the various Treaties require banks, vis-à-vis the OECD’s Financial Action Task Force’s (FATF), anti-money laundering (AML) regulations, to know “at all times” who the immediate beneficial owner of the assets they manage are – and, under the respective treaty agreements they must provide this transaction information (unless you are HSBC) to any bilateral authority that request it. The catch though, is that, again, banks cannot identify the beneficial owners of the deposits held through shell corporations because the data they are mandated to record and report on is based on “immediate” beneficiary (which is indeed “beneficial” immediately to the vast majority of “ordinary’ depositors – and, great if the IRS wants to identify and shut down the local drug dealer or domestic “evildoer”) rather than ultimate beneficiary/owner (the “professional” tax evaders).

    Great, then change the ‘Know Your Customer’ (KYC) AML deposit data set (create a universal KYC/AML record) or create a ‘universal’ data set so as to better establish the real (ultimate) beneficial owner(s). If effective, and combined with the risk of prosecution then, in all likelihood, it would have an immediate effect; deposits in the most secretive tax havens would be repatriated almost overnight or flow to more transparent jurisdictions (because they have nowhere, “secret”, to go).

    However, citing prohibitive cost of implementation, jurisdictional issues, client confidentiality etc., etc. six OECD countries stand out as passive resistors (most recently ‘”condensing” 49 FAFT recommendations down to 40 and moving from a forensic KYC approach to a more ‘risk-based’ approach) to international implement of an AML minimum data set – a reporting requirement that would provide records on beneficial (ultimate) ownership of deposits:.

    Where in the world, it’s easiest to both create a shell company and most difficult to obtain general account information? In rank order (1-10), and in the opinion of the Tax Justice Network (as reported by Forbes), these are the 10 most significant secrecy tax havens in the world: U.S. (Delaware), Luxembourg, Switzerland, Cayman Islands, the U.K. (City of London), Ireland, Bermuda, Singapore, Belgium and Hong Kong.


    Indeed, so underwhelming is the UK’s (City of London) and the US’ commitment to global KYC/AML, that while being members in their own regional jurisdictions’ FAFT (and the US additionally in the Asia/Pacific Group on Money Laundering (APG, sic)), it’s, perhaps telling that the they are either not members or are only “observers” in their corresponding regional entities (http://www.fatf-gafi.org/countries/) of:
    Caribbean Financial Action Task Force (CFATF); Eurasian Group (EAG); Eastern and Southern Africa Anti-Money Laundering Group ESAAMLG); Financial Action Task Force on Money Laundering in South America (GAFISUD); Inter-Governmental Action Group against Money Laundering in West Africa (GIABA); Middle East and North Africa Financial Action Task Force (MENAFATF); and (remarkably, given HSBC’s history)Council of Europe Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL).

  36. Andrew Watts

    There exists a wide range of apologists who have tried to diminish in the public mind the extent of the influence that American oligarchs wield over ordinary life. Popular intellectuals ranging from such liberal figures as Adolph A. Berle to John Kenneth Galbraith come to mind. Both of whom contended that our massive corporations are not in fact controlled by majority holding stockholders with last names such as DuPont, Rockefeller, Whitney, Ford, McCormick, and/or Mellon. But by the corporate bureaucracies which run the day-to-day operations. Despite numerous historical examples to the contrary. Berle went even further than Galbraith and insisted that property exercised little to no power at all in the United States. This assertion coming from a New Dealer is hilarious for all the obvious reasons.

    Further inquiry into Galbraith’s alleged apologetic stance towards American oligarchy will demonstrate he thought that having the government and big business work together was a desirable outcome. He believed that they worked together for stability. Unfortunately for his ideas he did not suffer from the bitter experiences we have endured in the present. As for his other ideas regarding countervailing power; the growth of wealth inequality and steady erosion of worker’s purchasing power effectively refutes the idea that there was ever a countervailing force at work. While the present state of the middle and working classes should bury any notion that these classes have wielded any significant power. Previous eras of American history had an easier time fostering these illusions in the masses. Even while radical labor organizers realizing their precarious situation tried to extort their employers and organize the masses against them.

    Historians such as Charles A. Beard who insisted that the Constitution of 1787 was the result of self-interested men of property have long since fallen out of favor in that profession. While an intellectual like Ferdinand Lundberg being the last well known individual to devote his intellectual pursuits to the naming and shaming of America’s oligarchs has been purged from the public memory.

    There really hasn’t been a comprehensive study of the American oligarchy since Lundberg’s The Rich and the Super-Rich: A Study in the Power of Money Today.

    1. JTfaraday

      “Historians such as Charles A. Beard who insisted that the Constitution of 1787 was the result of self-interested men of property have long since fallen out of favor in that profession.”

      Never fear. He’s coming back alright.

  37. Multimedia

    Heya! I just wanted to ask if you ever have any trouble
    with hackers? My last blog (wordpress) was hacked and I ended up losing months
    of hard work due to no backup. Do you have any methods to
    prevent hackers?

  38. Mickey Marzick in Akron, Ohio

    Didn’t make it to this party yesterday. Read most of the comments… Don’t have much to add – as usual. But let me try.

    Oligarchs, power elite, ruling class…. the Man! Call it what you will in this parlor game of “double speak” as if it’s merely a question of correct nomenclature. Isn’t this obsession with definitions part of the problem – a distraction?

    Who cares? Why is “oligarchs” more preferable than the 1%? As if the 1% at the Founding were any different than the current 1%. Or is that what we’re really talking about – the scale or magnitude of the looting. This time it’s really different… as if stealing a continent from its original inhabitants or enslaving millions of human beings as property pales in comparison. But this time it’s OUR money, right?

    Let’s get empirical and administer the bar test. Visit your local tavern or watering hole this evening and see which term/definition resonates with the patrons. I’ll bet a beer or two, whatever you’re drinking, that there’s more mileage with 1% than with “oligarchs” because the patrons won’t know what oligarchs means, – oligarchs, say what? Huh? And this opens another can of worms – political illiteracy, if not illiteracy in general.

    And while at the bar administer the Sociology 101 Test: Ask the participants in the discussion to name the most powerful MINORITY in this country.

    Most Caucasians are likely to respond with racial epitaphs, women, Jews/bankers, or a combination thereof, etc. But 9 times out of 10 you will NOT hear ‘the rich” or the 1% or, even less likely, the OLIGARCHS! The very fact that most Americans don’t even think of any of the latter as a minority speaks volumes. Talk about the manufacturing of consent!

    But if and when you point this out, one of two things will likely happen: 1) you’ll be called a communist or worse obscenity and just might get your ass kicked, depending on how “patriotic” or tanked the discussants are that night; 2) or be met with that look/stare of resignation which signifies that that’s just the way it is with the “understanding” of what happens to those who challenge this arrangement. It’s the internalization of this “inner cop” in the land of free and home of the brave that WE all know/learn speaking to power has its limits.

    Then too, how many Americans want to be rich? And doesn’t the chance that this stairway to heaven is open to all, at least in theory, facilitate the masking of this 1% as a MINORITY? Yet 1% signifies the latter without much need for additional discourse.

    Whatever we call this MINORITY so long as most Americans want to be rich or don’t envision this group as the most powerful minority in this country, definitions are the least of our problems. This minority has been around since the founding of the republic. Just read Federalist #10 if you want the blueprint for domination.

    The primary difference between now and say, the period before 1975 is that our parents and/or grandparents had “COLLECTIVE LEVERAGE” in that they could stop production. We don’t! Stop worrying or fretting about how we define the current round of looting and its perpetrators and figure out how we can acquire the “collective leverage” to alter the relationship between “us” and “them”. That’s ALL that matters.

  39. grumpyguyCjames

    so… what do we do about it!!!!!

    thank you, Yves. Brilliant and illuminating. As usual.

  40. Julie B

    Great post.

    I’ll just add this: if America were truly a meritocracy, employees would be rating their bosses, not the other way around. If employee ratings on bosses were required – and were required to be acted upon if the boss was found to be abusive or incompetent – it would put American business into complete chaos – and the American elite would be outed for the complete posers that most of them are.

    The American workforce has been cut to the bone, and what’s left is a system of harsh competition between the workers, and cushy cronyism for those who lack a conscience and stomp their way to the top. So far, the system is staying afloat, supported by a stressed, exhausted skeleton workforce.

    But that can’t last. Things WILL fall apart, because the sociopaths who now run most American businesses are not competent. What they have are excellent skills of aggression and dominance, aided by a talent for mimicry and pretense. We will find out soon enough that narcissistic sociopathy and play-acting a part – the current role of most of the elite – is no substitute for real leadership and competence.

  41. James F Traynor

    Ah Yves, how I love thee … etc., etc., and so forth! The ladies certainly have had the balls in the economic sphere these last few years, speaking truth to power. A cliche but, as are many of them, apt.

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