How bailing out the rich created the Depression

Crooks and Liars

The other day, Krugman wrote that we’re in the beginning of a new Long Depression.

Forgive me, but he’s wrong: this isn’t the beginning, it’s been going on for about two years now.

During a Depression there are periods where GDP grows. There are periods where jobs grow. It’s just that the periods of job growth don’t last.

There were opportunities to end the Depression before it really dug in its heels. The last one was at the beginning of Obama’s term. Kicking out of the Depression required two things.

The first was an adequate stimulus. This didn’t just mean a large enough stimulus, though the one offered was not large enough, it meant one properly constructed. Tax cuts for ordinary Americans are not stimulative, because folks like banks who have pricing power (you must have a credit card, loans, etc…) will simply take that money away by raising rates and fees. And it doesn’t mean short term shovel-projects, it means making commitments which will last for years so that businesses, when making plans know that hiring is worth it because those employees will be needed for more than a year or so.

Likewise the US has some serious problems with the structure of the American economy. The cornerstone of the stimulus had to be reducing US dependence on oil because as long as the US economy is so dependent on oil, full fledged growth is simply not possible. The days of $20/barrel oil aren’t coming back, and every time the price of oil gets too high, it puts great pressure on the US economy (and every other modern nation.)

more here

Leo Tolstoy: The Law of Love and the Law of Violence

to be of use

[The Last Station, the wonderful film about Leo Tolstoy’s relationships with his wife and followers, and his last days, is now available on Netflix.]

At the end of his wistful last book, The Law of Love and the Law of Violence, Leo Tolstoy wrote:

Put the good of your life in the progressive liberation of your mind, freedom from all the illusions of the flesh, and in the perfecting of your love for your fellow man — which is in essence the same thing. As soon as you begin to live like this, you will feel a joyous sensation full of liberty and happiness. You will be surprised to find that the same external conditions which caused you such anxiety, and which were far from what you wanted, will not prevent your experiencing the greatest possible happiness.

And if you are unhappy — I know that you are — reflect upon what is proposed to you here, which is not the product of my imagination merely, but of the thoughts and feelings of the best minds and hearts. It provides the only way to deliver you from your unhappiness and give you the greatest good you can get in this life.

That is what I have wanted to say to you, my brothers. Before I died.

10 Easy Steps for Becoming a Radical Homemaker

YES! Magazine

When Shannon Hayes made a list of easy steps for becoming a radical homemaker, she didn’t realize just how revolutionary they were.

When I first released Radical Homemakers: Reclaiming Domesticity from a Consumer Culture, I was advised to make a list of “easy steps for becoming a radical homemaker” as part of my publicity outreach materials. My shoulders slumped at the very thought: Three years of research about the social, economic, and ecological significance of homemaking, and I had to reduce it to 10 easy tips? I didn’t see a to-do list as a viable route to a dramatic shift in thinking, beliefs, and behaviors. But since the objective of such a list was smoother discussion and communication of Radical Homemaking ideas with the public, I did it.

I came up with the simplest things I could imagine—like committing to hanging laundry out to dry, dedicating a portion of the lawn to a vegetable garden, making an effort to get to know neighbors to enable greater cooperation and reduce resource consumption. I would perfunctorily refer back to them when radio dialogues flagged, when interviews seemed to be getting off track, or to distract myself when an occasional wave of personal sarcasm (I do have them on occasion) threatened to jeopardize an otherwise polite discourse about the book. After about 40 media interviews, I was pretty good at rattling them off, and I began to see their power and significance beyond helping me to be polite.

Take hanging out the laundry as an example. At the outset, it is deceptively simple: It saves money and resources, and it’s easy. As I spoke about line-drying laundry more, however, the suggestion took on more meaning. Of course everyone would like to hang out the laundry. But many people don’t do it. They’re too busy.

Jim Houle: War going badly? Let’s just fire the General!

Redwood Valley

The abrupt dismissal of General Stanley McChrystal by President Obama confirms that the war in Afghanistan is going very badly indeed. The general would not have been fired for a few unguarded remarks to a 2nd tier magazine had the war been succeeding according to plan. It may well be that his only offense was to express in too blunt and undiplomatic a fashion the sentiments of broad sections of the US officer corps. Nevertheless, the COIN (counterinsurgency) strategy, that McChrystal himself designed and that his boss General Patraeus sold to Washington, is rapidly falling apart:

•The death toll for US and NATO troops rose to 85 so far in June, making this the worst month since the US invaded Afghanistan way back in October 2001.

•The US quartermasters who maintain the supply chain for war materiel hire various war lords to funnel these supplies from Pakistan ports and from Central Asian airports into our Afghani bases. A good portion of these transportation costs have now been exposed as flowing directly into the coffers of Taliban insurgents so as to convince them not to attack the trucks. Thus, the Pentagon is indirectly financing the insurgency to the tune of approximately $2 million a week.

•The failure of the US intervention in the southern town of Marjah this spring is now admitted (McChrystal calls it “a bleeding ulcer”). The Marjah campaign was intended to demonstrate how COIN would win local support (McChrystal jokingly called it ‘government in a box’). The major advance into Kandahar, Afghanistan’s second largest city, has had to be postponed at least until next fall.

•Amongst the Afghan people, President Hamid Karzai is widely reviled as a corrupt American puppet while his brother continues to operate a major opium entrepot. Opium remains the country’s major cash crop (right next to US handouts and bribes).

Thom Hartmann: There are now Bankster Sharks in the Water…


In his New York Times column, economist Paul Krugman is ringing the warning bell and saying we are in the early stages of a “third depression.” “This third depression,” he writes, “will be primarily a failure of policy” as the world’s leading governments focus “about inflation when the real threat is deflation, preaching the need for belt-tightening when the real problem is inadequate spending.”

It’s truly bizarre to watch country after country across Europe fail to learn the lessons of the past and hang tight to the economic policies of Herbert Hoover and Milton Friedman when both have been tried – and failed – repeatedly in countries all over the world over the past 80 years. The only reasonable rationale for why these national leaders are willing to destroy their social safety nets, throw their working people into serfdom, and drain the resources of their tattered middle classes to reduce their national debts is that – unlike other times in the past – there are now sharks in the water.

Those sharks are the banksters, liberated in 1998 and 2000 by Phil and Wendy Gramm and Bill Clinton, Larry Summers, and Robert Rubin. Now that the banksters have been deregulated and can run trillion dollar gambling casinos, one of their easiest targets are the countries that have a lot of debt – just like the corporate raiders and so-called “private equity” companies look for companies with lots of debt to take down, disassemble, fire all the workers, and ship the jobs to China. Because these bankster sharks are now fully empowered in the waters of international finance, the traditional tool used

Book Review: Nothing’s too small to make a difference


[…] But perhaps the most heartwarming thing I found in this remarkable little book is a short sentence in an essay by co-editor Wanda Urbanska as she writes about the Simple Living television series she hosted.

A mantra which threaded overtly and subliminally throughout the show’s 39 episodes … “Nothing’s too small to make a difference.” Picking up a trash-bound paperclip, repurposing your mother’s 1960s skirt into kitchen curtains, installing a water-saving, dual-flush commode; each of these action steps qualified.

“Nothing’s too small to make a difference.” In the short days since I’ve read that phrase, it has given me enormous peace of mind.

In the Transition movement I often immerse myself in the huge problems, the sweeping issues. How do we transform an entire society? How do we Transition a city the size of Los Angeles? How do we bring along the poor and the extremely poor, not just the upper-middle-class white faces? What events or programs will best get the attention of those upper-middle-class faces, entrenched as they are with teeth gritted in the final throes of the Industrial Growth Complex rat race?

So often I forget to value what I do have. “Nothing’s too small to make a difference” has given me enormous relief this week. An hour spent weeding the community garden. A meal which includes vegetables from my own backyard. Watching my kids sit in the cage with our new chickens. There is great joy in these little moments.

The journey to the post-petroleum future is going to be made up of a bazillion of these “too small” events. It is the cumulative energy that creates the Transition movement. Yet there is joy in the details. No, it doesn’t make U.S. dollar sense to raise city chickens, but it makes enormous difference to my kids and to my own heart. No, it doesn’t change the world if my dinner includes only a few homegrown ingredients. But it’s a start. And at this point on the timeline, we need to remember to value each of those little “too small” steps. We need to make space in our lives to appreciate and honor the “starts.”

Less is More and the Simplicity movement remind us that the inner goal is “knowing who you are, being clear about your values, understanding what brings true well-being.” In this context, each of the erstwhile “too small” steps has value. Each brings us that much closer to the mark …

of living the way we dream of living;
of living a life of deeper integrity;

Todd Walton: Solar School

Anderson Valley

Mendocino has a spanking new elementary/junior high school on Little Lake Road about a mile inland from the village, and I am happy to report that her shiny blue metal rooftops are being covered with photovoltaic cells to produce electricity. I was recently at the school shooting hoops on one of the three new outdoor basketball courts, fresh nets affixed to glossy orange rims, and as I huffed and puffed in humbling pursuit of my largely uncooperative basketball, valiant technicians were hard at work affixing the solar cells.

It was a sunny day, and in the absence of students or anyone else making use of the new school, I thrilled to imagine the school’s electric meters whirling in reverse as great currents of electricity flowed from the rooftops into the greater power grid. Such imagining made me happy in the face of the murderous gusher continuing to gush in the Gulf of Mexico. I am aware that solar power is not the ultimate answer to the woes of the world. I have read myriad articles by smart people explaining how electric cars are every bit as bad for the earth as gasoline powered cars. I have read even more articles by these same and other smart people explaining how renewable energy will never replace oil and that we are destined, rather soon, for a new Dark Age of lawlessness and mass starvation. But whenever I stopped to catch my breath from chasing my runaway basketball and saw those fellows affixing solar panels to the shiny blue roof, I felt twinges of hope.

When I was a young man I decided to try to make my living as a musician and a writer. I worked as a landscaper, a gardener, a janitor, a ditch digger, a farmhand, a day care worker, and at several other low-paying jobs. With whatever energy I had left at the end of each day, I practiced music and writing. And for ten years, every person I knew, including my best friends and many smart people, told me with absolute certainty, “You will never succeed as a writer or as a musician. Give it up.” And when I did succeed, these same absolutely certain people said, “I always knew you’d make it.”

Indeed, I have subsequently observed again and again that smart people are often very good at talking themselves and other people out of doing things by stating with absolute certainty that the thing in question cannot be achieved, and they know the thing cannot be achieved because they have the data to prove it. “Oh, so you put in a gray water system to water your garden and conserve water. Big deal. That won’t help. Corporations waste millions of gallons of water every minute. Your little gray water system won’t make a bit of difference.

Michael Laybourn: The Real Facts About Social Security


This letter from FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794 hit the internet a couple of years ago and I answered it. Maybe we need to do it again…

The letter starts:
Franklin Roosevelt, a Democrat, introduced the Social Security (FICA) Program.  He  promised:
1.) That participation in the Program would be completely voluntary,
2.) That the participants would only have to pay 1% of the first $1,400 of their annual incomes into the program,
3.) That the money the participants elected to put into the Program would be deductible from their income for tax purposes each year,
4.) That the money the participants put into the independent “Trust Fund” rather than into the general operating fund, and therefore, would only be used to fund the Social Security Retirement Program, and no other government program, and,
5.) That the annuity payments to the retirees would never be taxed as income.

ML A: Wrong. Originally, President Roosevelt called for “social insurance.” He envisioned a plan through which workers would contribute and provide for their own future economic security. He specifically disdained the idea of reliance upon welfare. The original SSA embraced the idea of Social Security being an insurance program under which a group of individuals were insured against identifiable risks: disability and old age. Workers paid for their own insurance.

The original 1935 statute paid retirement benefits only to the primary worker. Many types of people were excluded, mainly farm workers, the self-employed, and anyone employed by an employer of fewer than ten people. These limitations, intended to exclude those from whom it would be difficult to monitor compliance, covered approximately half of the civilian labor force in the United States.

This had to change of course: In 1939, the 1937 Federal Insurance Contributions Act (FICA) tax was amended in three important ways:
1. The widowed, nonworking spouse of a someone  entitled to an old-age benefit also became entitled to an old-age benefit.
2. Survivors (widows and orphans) became eligible for a benefit. This feature was very popular among the millions of elderly Americans hard hit

Bruce Patterson: The Anyhow Saloon

Anderson Valley

Old Henry never thought he’d ever get snake bit enough to have to endure forty-two days hunkered down inside his backwoods cabin under a near-on relentless barrage of rain, hail, sleet and snow. There was wet snow dropping from the sky like bullets; snow falling in downward spirals like mortally wounded bi-planes; snow howling sideways and, now and again, fat snowflakes gently floating through the redwoods to silent landings all shoulder-to-shoulder and butt-to-belly. Then the next morning them poor snowflakes would get themselves bushwhacked by a good old-fashioned, shutter-banging, tree-slapping, gully-washing rainstorm.

No Siree. If old Henry had’ve wanted to winter up in Alaska, he’d’ve moved to Alaska by golly. He hadn’t set down stakes in the redwoods just to have to sit and stare out his foggy window at them shivering half to death.

The other day a Great Blue Heron landed in Henry’s yard and got his big webbed feet stuck in the mud. Henry watched out his window as the poor fellah furiously flapped his wings trying to unstick himself, and then strained to lift up one foot and then the other. Having no luck either way, the heron finally got to just standing there perfectly still as if, reconciled to maybe having to stay put till spring, he decided he may as well get some hunting in.

Not willing to leave the poor fellah to his fate, and after deciding he couldn’t very well lasso him and yank him loose without hurting him, much less dig him out by hand without getting his eyes plucked out for his trouble, Henry chose to go outside to try’n scare the fellah free, herons being bashful of people and all. So Henry showed himself and, seeing this towering, ungainly biped waddling his way with its skinny wings flapping and him honking like a goose, the heron shriveled his webbed feet, gave his wings one powerful downward whoosh, jerked up his knees into his chest, got airborne and raced away on the wind like he’d wasted enough time already.

Now there was a break in the noon clouds, a spot of blue, and Henry got to scratching the bottoms of his itchy feet. If the trail was too slippery to saddle up his clumsy young gelding, Henry could damn sure walk down the mountain his own self. In need of human company, a stiff drink and a jug of moonshine to go, Henry gathered himself up