Happy, Merry Resistance!

The latest, sleaziest and most predictable Obama sellout yet:

FCC Destroys Net Neutrality

The US bubbleklatura has now officially rocketed past the Soviet nomenklatura to qualify as the single most suicidal elite to immolate its Empire, ever.

This is usually the moment when progressives don the sackcloth and ashes, wallowing in self-indulgent doom and sepulchral gloom.

Screw that. 

To all Americans: it's time to let go of the Empire. You never owned it. It owned you. Today you get nothing from its rotting, diseased carcass except tens of thousands of dead and maimed bodies from failed trillion-dollar colonial wars, and trillion dollar debts from failed bankster bailouts.

To all non-Americans: it's time to build the multipolar world.

In the season of imperial collapse, it's more important than ever to dance with post-Imperial joy, to laugh with anti-capitalist mirth, and to spread tidings of commons-based cheer. 

The banksters own the US media, US politicians and the US war machine, but we own the developmental states and the videogame culture.

In the name of the Earth: свободы, humanity, 阻力!

Cablegate Ahoy!

Avast, ye swabs, the good pirate ship Wikileaks and its band of merry uploaders has made off with a kingly haul of the Empire's secrets, presently a-mirroring its way across the mediatic seas. Now here be a pretty bauble from that stash, where some low-level stooge of a dying Empire (a stooge who wouldn't know a democratic election if it bit them on the aft) smears Evo Morales, the democratically-elected President of Bolivia and, to paraphrase Tariq Ali, honorary pirate of the Caribbean:

"A leader with strong anti-democratic tendencies, over the years he has been known to bribe, threaten, and even physically intimidate anyone who has stood in his way, including government officials, politicians, and cocalero colleagues..."

Notice our Imperial stooge can't point out a single example of an actual undemocratic act or policy by Morales. That's because Morales has fought like hell for Bolivian democracy his entire life.
But who needs actual facts, when our stooge has amazing telepathic powers which can descry "anti-democratic tendencies" through sheer force of Washingtonian will. It's the miracle of faith-based diplomacy -- whatever the Empire believes, must be true! But the smear job is just beginning:

"While Morales excels at domestic political machinations, he is more like a struggling student in the areas of economics and international relations decisionmaking..."

If you can't play the Castro card, play the race card: those brown peasants south of the border are easily bamboozled, so let's sucker them with some low-cost teaser loans with balloon payments five years down the line. This is the same obnoxious line you'll find in countless email messages from the punters, scam artists and boiler room operators who heaped contempt on poor people while swindling them out of their life savings with fraudulent mortgages. But unfortunately for our stooge, there are other Bolivians who have the temerity to act in their country's good, instead of for the enrichment of comprador/Wall Street elites:

"His domestic intellectual advisers (SEPTEL), who include Vice President Alvaro Garcia Linera, Minister of the Presidency Juan Ramon Quintana, and Minister of Planning Carlos Villegas, are largely leftist ideologues and have tended to have more influence with the President compared to his domestic political advisers because of his difficulty grasping complex economic theories and lack of experience in the international arena. Unfortunately, some of this advice borrows from a storehouse of discredited ideas and fantasyland assumptions."(Source: Cablesearch)


[Mighty gale of pirate laughter.] Arrr, this be the funniest thing I've read all year, a bankrupt Empire lecturing about fantasyland! And pray tell, just what discredited ideas would those be -- notions such as providing actual collateral for a mortgage loan, or having a functional industrial base instead of a bunch of bogus CDOs, or an economy not powered by current account deficits of hundreds of billions of dollars per annum financed by the semiperiphery, or elections not bought and paid for by worthless rentier scum financed by trillion dollar government bailouts for sleazy and busted gambler elites?

But don't worry, Mr. Stooge. The sun is setting on your Empire's villainy, and for each site you take down, a thousand more will appear in its place. Just remember, fellow pirates -- real pirates don't pillage, real pirates share!

Imperial Suicide Watch

Blade, meet jugular:

Senate GOP Vows To Block All Except Tax Cut, Debt Bills

You might think this is just domestic posturing.

[Cue dramatic pause, followed by hysterical post-American laughter.]

Not so. This is about putting the START treaty to reduce nuclear stockpiles, a rational and sane deal for both the US and Russia, on ice (treaties need 2/3rds majority, so it's not a question of that vile fiction called the filibuster).

The Rethuglicans strut and preen and issue bombastic statements, as if attempting to outdo their classic forerunners in intermingled Imperial corruption and decline, the Roman Senators. Where Rome borrowed other people's soldiers for its mad wars, America borrows other people's money for its mad speculations. But no Empire lasts forever, and now it is the turn of this one to be ground beneath the remorseless wheels of History.

Which explains Russia's response. Because Russia. Doesn't. Care.

They don't need to.

The Russian developmental state, a.k.a. Bearzilla, is loaded with cash, debt-free, and powering up its nanotech, aerospace and software industries.

But it matters for the US, because it depends on massive inflows of funds from the nations of the semi-periphery -- funds controlled by developmental states.
 This is the era of developmental states, and there's only one rule of the global jungle: do NOT bet against Bearzilla, Bolivarzilla, Pandazilla or Brazilla. If you try, you will be eaten.

Let the munching begin!

Chimeriducation

[Crackle and hiss of shortwave radio.]

To all survivors, a message to all survivors --

this is a special transmission from the Midwestern front. Repeat, a special transmission from the Midwestern front.

East Coast insurgents have decoded an important Chimeran broadcast, directed at all Chimeran feeding-centers. The decoded message reads, quote:

The New Norming: Feeding More Chimera With Less Humans

Secretary Orn E. Chimeran's Remarks at Chimerican Ingestion Institute

November 17, 2010

I am here to talk today about what has been called the New Norming. For the next several years, preschool, K-12, and postsecondary eradicators are likely to face the challenge of feeding more Chimera with less humans.

My message is that this challenge can, and should be, embraced as an opportunity...

Unquote. The broadcast signala a new wave of Chimeran attacks on all survivors. Repeat, new wave of Chimeran attacks on all survivors. Be alert for any activity around Chimeran feeding-centers.

This concludes our special transmission.

To all members of the East Coast Resistance... we broadcast. We fight. We survive.

To all members of the Earth... свободы, humanity, 阻力!

Battleship Chimerica

Chimeran forces structurally adjust puny, worthless humans

Human insurgents recently obtained a top-level Chimerican transmission to all Chimeran units, from a shadowy Chimeran unit known only as the National Commission on Fiscal Responsibility and Reform.

A team comprised of Dr. Malikov, Joe Capelli and John Harper has decoded the arcane neoliberal language of the original, and broadcast this translation:


Draft Proposal of the Chimeran Commission on Human Reduction


All insurgents are urged to broadcast additional transmissions as they can.

In the name of the Earth: свободы, humanity, 阻力!

Goldfingered

Robert Zoellick, career servant of US Empire, sums up its decay nicely:

World Bank president calls for debate on global gold standard

The wheel of History has come full circle, with a speed and ferocity none could foresee. Where the beginning of this Empire was drenched in high tragedy, its end wallows in low farce. It is waging colonial wars it cannot win, with money it has to borrow from its geopolitical competitors; the louder its ideology-industry trumpets its freedom, the more people rot in its jails and carceral state; the more zealously its media-industries proclaim its eternal greatness, the deeper the ruin of its public infrastructures; the more its bonus-mad banksters preach the virtues of self-reliance while living off the public purse, the deeper the immiseration of its former middle class.

With Zoellick, the circle is complete -- an Empire built on the might of fiat currency has now officially regressed to the senile rantings of the goldbugs, their ideologies 150 years out of date, like Dickens' Scrooge channeling William Gibson's doomed corporate chieftain Ashpool. Only no late-Victorian expansion will save the Scrooges of Wall Street from the most terrifying ghost of them all -- the ghost from the BRICs' future.

It's amazing how accurately Gibson called the end of this Empire. In fact, he was close to perfect. Neuromancer was Brazil, heart of a renascent Latin America, he got that part of the semi-periphery right where many of us (including me) got it wrong.

But Wintermute wasn't really Swiss. Gibson almost got it right, because Wintermute's avatar was the Finn, a broad hint in the right direction. Let's see, what snow-covered country next to Finland just happens to be one of the key pivot-points of the 21st century... you guessed it: Wintermute is the Russian developmental state.

Sometime between 2008 and 2010, noone knows quite when, Wintermute and Neuromancer escaped the shackles of the US Empire's Turing Registry. They're going to peacefully and democratically remake the world-system, through close coordination and open consultation with the rest of the semi-periphery.

This is unquestionably a good thing. Sooner or later, humanity was going to have to evolve beyond the autocratic structures of the US Empire, so it might as well be sooner. All too many Americans are grumpy over losing their Empire, but frankly, all that unchecked power was toxic for our economy and poisonous for our democracy. We'll be infinitely better off without it.

But until that day of liberation comes, we'll have to keep our open source vessels well-crewed and shipshape, and keep battling the shambling remnants of the Empire, one pirate raid at a time.

Brazil Levels Up

Goodbye country of the future, hello country of a limitless present -- Brazil's developmental state powers up:

Rousseff wins Brazil's presidency

Those of us who follow the politics of the world semi-periphery have long noted the interesting fact that Brazil's 21st-century political clock seems to run thirty to thirty-six months behind Russia's. Putin's ascent in 1999 was the rough equivalent of Lula's ascent in 2002, and Russia's 2005 national projects anticipated Brazil's post-2008 infrastructure boom. Just as 2008 was a pivotal moment for Russia, when Putin handed off the baton to the young but extremely capable Medvedev -- one of the smartest executive decisions Putin ever made, because the time had indeed come to pass the baton on to the next generation -- Brazil's 2010 election is witnessing a similar transition, from the era of laying the foundations of the developmental state, to its qualitative expansion.

The battles ahead will be much less glamorous, but are no less important: expanding the Bolsa Familia into a genuine welfare state; building up Brazil's sovereign wealth and deploying its excess earnings into infrastructure, housing, and education; turning Brazil's already impressive renewable energy sector into a global player; and leveraging Brazil's world-class media traditions into digital media industries.

Diagram for a Transnational Play

Autumnal afternoon on Wall Street. Alien hovercraft lands, gaggle of nattily-dressed lizards with briefcases and polycarbon-suited nanobears with digipads disembark. They politely knock on the glass panes of Goldman Sachs' office.
*Knock* *knock.*
Loudspeaker: “Who's there?”
Chorus of lizards/nanobears: “The BRICs.”
Security: “The who?”
Chorus: “Brazil, Russia, India, China.”
Loudspeaker: “Ah, I'm afraid you'll have to make an appointment –”
Chorus: interrupting: “We're taking our world-system back.”
Loudspeaker: “Taking... ?”
Chorus: “The world-system.”
Frozen pause.
Voice of Lloyd Blankfein: “Ladies and gentleman... ah... most unexpected meeting...” Nervous cough: “...we seem to have misplaced the bill of sale.”
Chorus: “We brought the duplicate.” A nanobear holds up a nanofiber document.
Voice of Lloyd Blankfein: brightly: “Ah. Well, that's that. Care for some tea? Coffee? We have this wonderful CDO tranche –”
Chorus: “Thank you for your time.” Exit chorus into hovercraft, which flies off.

Resistance...

...is the dance of life.

Not too much dancing here in Bubble-shocked America, land of dwindling real incomes, the smoking rubble of home equity values, 42 million people surviving on foodstamps, a de-industrialized wasteland overrun by the howling Chimera of Wall Street. America is suffering through its Years of Lead, its Gorbachevian ideals rusting into Yeltsinian decrepitude, bankrupted by failed colonial wars which keep redefining the meaning of colossal, abysmal, crashing-through-ever-deeper-pits-of-Hell failure.

But hope glimmers on the horizon: the people of Venezuela voted overwhelmingly for a better future -- a future without war, Empire, domination and ecological ruin.

In the distant past, the Thatcherites -- an embryonic species of Chimera, not fully extruded from their neo-national shells, but savvy enough to conceal the reality of regressive plunder with the veneer of progress -- used to argue smugly, "there is no alternative".

No, there is no alternative -- there is only resistance.

United States of Chimerica

Kudos to world-class game studio Insomniac for nailing the popular mood, which is ugly, ugly, ugly.

Depression-level economic pain + Dylan's 1963 antiwar song = Resistance 3's version of Bubble-shocked America.

Yes, we're all in digital boxcars now, passing through a landscape ravaged by the howling, shrieking monsters of Wall Street... but we're not going out without a fight.

(For those unfamiliar with the Resistance franchise, click here and here).

Running the Numbers

Leading pundits in the US mainstream media have been wondering why ordinary Americans are anxious about the economy and upset about the future. After all, Goldman Sachs is back to bagging billion dollar bonuses, so all is well... riiiight?

America was once the land of the middle class. But life in this country is becoming increasingly hostile to anyone outside the wealthiest 5% of Americans.

Land of the jailed: 2.3 million adults are locked up by a vicious, racist and punitive prison-industrial complex (5 million are under surveillance).

Land of bankster bailouts: Wall Street nearly blows up the world economy, is rewarded by the politicians it purchased with $3 billion in campaign donations with a $9.1 trillion direct bailout (with a set of implicit guarantees of $8 trillion, for a grand total of $15 trillion) from the Treasury-Wall Street-insco (insco = "insurance company") complex.

Land of the bankrupt: 25% of all Americans have bad credit scores, up from 15% just a few years ago.

Land of trillion dollar war spending. And what did we get for our criminal $1.024 trillion-and-counting failed colonial wars? Forty thousand US casualties, at least 1 million Iraqi/Afghani casualties, an Afghanistan spiraling into chaos, and an Iraq run by a pro-Iranian Shiite theocracy.

Land of malnutrition: 40 million Americans barely survive on foodstamps.

Land of debt: total debt to GDP ratio is 357% (not a typo -- three hundred and fifty seventy percent, about a third of it racked up by Wall Street banksters).

Land of the unemployed: the recession destroyed 8 million jobs, and the employment-to-population ratio is the lowest since 1984.

Land of crumbling infrastructure: the US investment to GDP ratio crashed to 15% in 2009, which means we're barely keeping up with repairs. Healthy economies invest between 20%-25% of GDP, booming ones at 30% or more.

The US desperately needs a massive green jobs/renewable energy/education program. The money is there -- it's just being spent on criminal colonial wars and asinine rentier bailouts. The US middle class must re-learn the art of class struggle it once waged during the New Deal: no struggle, no future.

Developmental States: The Next Generation

For three long decades, neoliberal capitalism pitilessly savaged the planet, blighting billions of human lives and wrecking entire continents for the sake of a tiny oligarchic elite.

But beginning in the late 1990s, resistance movements began to emerge. In the beginning, they were tiny -- a handful of protests here, a scattering of workers there. But the resistance grew and grew. The handful turned into an armful, armfuls into gatherings, gatherings into crowds.

All across the planet, working people fought back -- and began to win victories.

One of the most significant of these victories was the construction of mighty developmental states. These were peaceful, democratic revolutions which took back national economies bankrupted by predatory foreign neoliberal elites and from their no less predatory comprador underlings.

The first group of developmental states emerged around 1999 or. Their most obvious manifestation: the BRIC nations (Brazil, Russia, India and China), trillion-dollar behemoths who are rapidly becoming the leading engines of the world economy.

But the story doesn't end there. The next generation of developmental states is emerging, born out of geopolitical necessity and ongoing struggles for human dignity and social justice. Here are some snapshots of the process:

Bangladesh: Al-jazeera: Bangladeshi labourers demand more pay

Egypt: In These Times: In Egypt, Arab World’s ‘Largest Social Movement’ Gains Steam Among Workers

Indonesia and Turkey: Antara: President arrives in Turkey

Israelo-apartheid Commits Suicide

The Young Turks' moderator, Cenk Uygur, rips the mask off the rotting, zombified shambles of the US Empire and shows just how hideous its worm-eaten visage has become: "US Citizen Executed In Israeli Flotilla Raid?"

Israelo-apartheid's goons shot 19-year-old Furhan Dogan, an unarmed aid worker on the Gaza Freedom Flotilla, four times in the head in international waters. Why? Dogan and his fellow passengers were trying to deliver desperately needed humanitarian supplies to the 1.5 million people of Gaza locked down by a cruel and illegal Israeli blockade.

Dogan was born in the US and has an American passport. Israel murdered a US citizen. And contrary to Israel's pathetic attempts to smear the Freedom Flotilla, attempts so obviously and outrageously untrue as to border on clinical psychosis, Dogan was neither an al-Qaeda agent nor a suicide bomber. He was a US citizen engaged in the most honorable thing any human being can ever do -- peacefully upholding the human rights of other human beings.

Dozens of eyewitnesses aboard the ships confirm Israeli forces opened fire on Dogan and the other unarmed aid workers from helicopters. The attack occurred in international waters, and targeted ships flagged in Turkey, the US and other EU countries. This was no rogue operation, it was approved by the highest levels of Israel's government. As such, this was not just an outright massacre, it is an act of open war by Israel on Israel's *own allies*.

But the business of an increasingly deranged and doomed US Empire is empire, which means it will do nothing to restrain its increasingly deranged and doomed puppet state (Israel gets $3 billion in cash from the US every year -- not loans, straight up cash). Here's the official US response to the murder of nine defenseless aid workers and the Mafia-style shooting of an American citizen in the head: the events were a tragedy requiring investigation.

But there are powerful social forces which *will* restrain Israel, forces which have consigned settler colonialism in all its forms to the trash heap of history. First of all, Israel has run out of regional enemies: it's at peace with Egypt and Jordan, Syria doesn't want war, and Hezbollah in Lebanon simply wants to be left alone. Second, the EU is in no mood to kowtow to Wall Street banksters or US imperial gangsters, while Turkey is a regional superpower and growing stronger by the day. There will be bigger and better Freedom Flotillas, and the blockade of Gaza will be defeated.

America's Chernobyl

I'm old enough to remember the Chernobyl disaster, the worst-ever nuclear accident in human history. It was the moment when the Soviet monopoly-state forever delegitimated itself as an agency of modernization (or even moderate competency).

Now the US Empire is experiencing its very own Chernobyl -- not from a nuclear plant, but from a deep-sea well pouring millions of gallons of raw petrocarbons into the Caribbean.

What was most shocking about the spill aren't BP's lies, prevarications, and incompetence, but the manner in which the entire edifice of petro-fundamentalism has crumbled down. This disaster wasn't a once-in-a-lifetime, "black swan" event, it was the predictable result of incompetent, bought-off Federal regulators (basic safety features were never mandated), Federal policies which systematically privileged petrocarbons over renewable energy (drilling instead of conservation), and above all, the toxic ideology of market fundamentalism (what's good for BP's shareholders is good, and the eco-system be damned).

I suppose this is how postmodern Empires die -- not with a bang, but with a landscape/seascape of ecological ruination.

PBS has a live feed of the spill here).

Olympus, Meet Kratos

Every world citizen should give thanks to the citizens of Greece, who followed the advice of Kratos, protagonist of Sony Santa Monica's magnificent God of War franchise, and refused to accept the malign dominion of Zeus -- a.k.a. Euroliberalism.

The credit markets of Europe's smaller Mediterranean nations have been getting hammered by bond traders in recent days. But the EU is not a small player in the world economy. It is a behemoth with a 16 trillion annual GDP, the largest single economy on the planet. Just like the BRIC nations, which have vast financial resources and fundamentally sound economies, Europe can defend itself against speculators. The only question was whether it had the political will.

This question has been answered. At long last, the EU rolled out the trillion-dollar bailout package they should've instituted long ago.

This isn't the end of the story. The people of Greece have opened the Pandora's box of transnational democracy: the faint, flickering and yet ineradicable hope for a different and better world is now alight, from the streets of Athens to the forests of Orissa, and from the tenements of Rio de Janeiro to the apartment blocks of Moscow.

The BRICs Build Their Neighborhood

Big doings from BRIC-land. Here's the state of play:

1. Brazil and China signed a raft of multilateral agreements covering everything from financial cooperation to joint infrastructure investments and research consortia.

2. Brazil is launching a full-scale national infrastructure program. About $1 trillion will be channeled into the economy over the next four years -- enough to raise growth rates from the tepid 3% average during the early 2000s to tigerish 5-7% levels. This should also drive regional integration, boosting Brazil's neighbors.

3. Russia is bailing out the Ukraine to the tune of $40 billion in subsidies over 10 years, or about $4 billion/year. That may sound like a lot, but Russia has half a trillion dollars in reserves, far more than it needs, and helping out its neighbor isn't just the right thing to do, it's the smart thing to do. Ukraine has huge potential -- low debt levels, an extremely well educated population, lots of university students, etc. -- all it needs is a bit of cash to launch its very own Eurasian developmental state.

4. Inter-BRIC cooperation: a raft of agreements between Venezuela and China, and a new coordinating body to network their respective development banks.

8-Mile America

Every day, the irrationality and brokenness of this Empire plumbs new depths. Wall Street's sleazoid scam artists are rolling in billions, while our children -- our *future*, the last people who should ever be made to suffer for the mistakes and follies of adults -- are thrown on the scrap-heap.

There's just no money for the kids, cry the partisans of Empire.

There's plenty of money.

It's just spent on trillion-dollar bailouts for failed banksters and trillion-dollar budgets for failed colonial wars.

This shambles of a dying Empire now spends more on war than it did during the Cold War, despite the fact that (1) 80% of humanity lives in electoral democracies, and (2) China has a small military and is undergoing significant democratization. Here are the numbers:




Source: Military Budget of the United States

Podding

Podcasts come to Uplink: the first two are online for your listening pleasure.

Apologies for the less-than-stellar sound, I'm running all this on a budget of exactly zero.

The Other Shoe Drops...

...and hits with gigaton force. Here's the summit statement:

BRIC Summit Joint Statement, Brasilia, April 15 2010

In a nutshell, the BRICs are (1) purchasing the IMF with cold, hard cash and (2) launching a global Green Deal to power the world economy for the next 50 years. It's really the last act of decolonization -- after achieving political independence, the postcolonial nations are finally, at long last, and after centuries of struggle and inconceivable sacrifice, establishing their economic autonomy.

Here's a foretaste of what our henceforth multipolar world will look like:

World People's Conference on Climate Change and the Rights of Mother Earth, April 19-22, 2010

Last but hardly least, the wheels of justice are finally catching up to the Vampire Squid. Let the depositions begin!

Imperial Suicide You Can Believe In

The latest act of imperial self-destruction, as reported by Bloomberg:

----------
Lockheed F-35 Projected Cost May Rise an Additional $51 Billion
...
"The cost per plane would then be $155 million, 91 percent higher than the $81 million projected when the program began in 2002. The program’s total cost, calculated in current dollars, would increase 64 percent to $379 billion."
----------

Since the US is running vast current account and trade deficits, this madness has to be financed with OPM (Other People's Money). In the 1980s and 1990s, Japan and Germany loaned the US the money. But since 2000, most of the cash has come from the BRIC nations.

Not for much longer. Our creditors are going to meet in four days in Brasilia, and discover that they have better uses for their money than giving it to an utterly irresponsible and corrupt political class bent on pissing it away on criminal colonial wars and Cold War scrap metal -- like investing in high-growth Brazilian, Russian, Indian and Chinese markets, instead.

Twilight of the Ameri-gods

It begins.

The BRICs are discussing currency reforms, a.k.a. ring-fencing Wall Street neoliberalism's debt bubble (370% of US GDP). (Cue epic scenery, overhanging clouds, flash of thunder in distance, and finally a pan to Kratos tearing through the legions of Olympus.)

BRIC 2010 in Brasilia is going to be quite a show.

Coming soon: podcasts. I'm still learning the software, but will have some materials up soon.

Enter the BRICs: It's Showtime

The second BRIC summit is scheduled for April 16 in Brasilia, capital of Brazil. Last year's summit meeting in Yekaterinburg, Russia was very much the trial run for the Age of the BRICs. At that time, the BRICs kept their cards close to their chest, for the obvious reason that the global economy was still in free-fall, and crisis management (a polite euphemism for the orderly unwind of the US Empire's mountain of debt) was the order of the day. Still, it was only a question of time before post-neoliberal economics turned into multipolar geopolitics.

Now the recovery is finally here, the BRICs are cooking up something special. Stay tuned, because this is going to be the story which defines the next decade.

Bye, Bye, Imperial Pie

Bye, Bye Imperial Pie (with apologies to the Don McLean original):

A long, long time ago...
I can still remember
How subprime used to make me smile.
And I knew if I had my chance
That I could make those CDOs dance
And, maybe, the US would stay solvent for a while.

But October made Wall Street shiver
With every CDS delivered.
Bad news on the Street;
They couldn't take on more debt.

I can't remember if I cried
When I read about Goldman's AIG bribe,
But something touched me deep inside
The day the Empire died.

I started singing,
Bye, bye, Imperial pie
Drove interest rates to zero
but liquidity was dry
The Federal Reserve pumped up the money supply
Saying, “Otherwise the market will die”
“Otherwise the market will die.”

Did you rid the books of mortgage fraud,
And do you have faith in regulators above,
If the FASB tells you so?
Do you believe in ROE,
Can bailouts save your equity,
Can you get the dollar to decline real slow?

Well, I know that you're in love with GAAP
'cause I saw your pretax earnings snap
You beat the Street on revenues
Man, I dig those accounting rules

I was a lonely accountant on hold
At a ratings agency about to fold
But I knew I was getting rolled
The day liquidity died.

I started singing,
Bye, bye, Imperial pie
Drove interest rates to zero
but liquidity was dry
The Federal Reserve pumped up the money supply
Saying, “Otherwise the market will die”
“Otherwise the market will die.”

Now for ten months banks aren't lending cash
securities crash, CMBS are trash
But that's not how it used to be
When Wall Street declared the end of history
With credit borrowed from BRIC countries
And collateral that came from you and me

Ten years later, the BRICs ride high
Their trillion dollar economies thrive
But that's not how it used to be.
When their compradors sang the IMF's tune,
With ideologies borrowed from Hayekian loons
And collateral that came from you and me,

Oh, and while the ratings agencies looked away
Banksters were making subprime hay
Glass-Steagall was repealed;
CDOs were sealed.
And while neoliberals scorned the Left
The BRICs purchased the IMF
And Citicorp prayed for TARP
The day the Empire died.

I started singing,
Bye, bye, Imperial pie
Drove interest rates to zero
but liquidity was dry
The Federal Reserve pumped up the money supply
Saying, “Otherwise the market will die”
“Otherwise the market will die.”

Let's invest in a dotcom prospectus
No business plan or revenue offsets
Four trillion dollars of market cap
Exploded and Enron took the rap
Speculators tried to short the ride
With Greenspan on the sidelines rescuing LTCM's hide

Now 1% funds were sweet perfume
While the oiligarchy played a colonial tune
The banks all got up to dance
Oh, but the taxpayer never had a chance!
'Cause Wall Street had rigged the field
Treasury bills paid low yield
Do you recall the leverage revealed
the day the Empire died?

I started singing,
Bye, bye, Imperial pie
Drove interest rates to zero
but liquidity was dry
The Federal Reserve pumped up the money supply
Saying, “Otherwise the market will die”
“Otherwise the market will die.”

Oh, and there we were all turned to stone
A generation's 401Ks are gone
With no capital to start again
So come on: Goldman be nimble, Sachs be quick!
Goldman Sachs knew politics
'Cause your tax dollars are Wall Street's only friend

Oh, and as I watched Paulson on the stage
My hands were clenched in fists of rage
No politician or party hack
Dared incur Wall Street's wrath
And as the markets continued to expire
The Feds threw fourteen trillion onto the pyre
The taxpayer paid for AIG, Maiden Lane, and all the banks
The Fed even bought one trillion of toxic CMBS – gee, thanks!
The day the Empire died

I started singing,
Bye, bye, Imperial pie
Drove interest rates to zero
but liquidity was dry
The Federal Reserve pumped up the money supply
Saying, “Otherwise the market will die”
“Otherwise the market will die.”

I met a newscaster who read the news
And asked her about those green shoots
But she was broke and looking for a job
I went down to the local store
Where I temped years before
But the man there said they were closing down.

And in the streets, unemployment rose
State budgets crashed, and deficits explode
But not one criminal trial was brought
The regulators had all been bought
And the three people with sense,
Bill Black, Liz Warren, and Nomi Prins,
Got no mainstream media or press
The day the Empire died

I started singing,
Bye, bye, Imperial pie
Drove interest rates to zero
but liquidity was dry
The Federal Reserve pumped up the money supply
Saying, “Otherwise the market will die”
“Otherwise the market will die.”

I started singing,
Bye, bye, Imperial pie
Drove interest rates to zero
but liquidity was dry
The Federal Reserve pumped up the money supply
Saying, “Otherwise the market will die”
“Otherwise the market will die.”

Spring Cheer

After a hard winter, some reasons to be cheerful:

1. BRIC forex reserves just passed the $3.36 trillion mark and growth in the semi-periphery is turning up, faster than anyone expected. For thirty years, the world-economy flew on two jet engines -- the US and the EU. Now the world economy has a third jet engine, which potentially outclasses the thrust of both previous engines combined.

2. Unemployment peaked in November, the recovery is real, which means we're going to see feisty progressive politics kicking in across the US and EU. (The catastrophists are wrong: austerity doesn't make people rebel, aspirations do.) It's high time to junk our military-industrial complex, soak the rich, and spend on the rest of us.

3. The videogame culture -- a.k.a. the mediatic expression of the multipolar world -- is kicking into high gear. God of War 3, Yakuza 3, Metal Gear Solid: Peace Walker, Alan Wake and Resistance 3 are all on the way, and that's the tip of the iceberg.

4. While the existing developmental states continue to rapidly evolve (Asiazilla is boosting consumption, Bolivarzilla is spearheading Latin America's integration and Bearzilla is powering up the nanotech gloves), it looks like another wave of developmental states is nearing take-off. The leading candidates: Tunisia, Turkey, Ukraine, Belarus, Kazakhstan, Uzbekistan, Mongolia and Indonesia. Angola and Nigeria may also join the list, if they can channel their energy-rents into sovereign wealth funds and internal industrialization.

State of the US Meltdown II

It's often said you can judge a country by how it treats its children. They are the most vulnerable and weakest members of every society, but they are also its future.

By that standard, the US fails.

The latest example of this failure is Central Falls, Rhode Island. Thanks to the magic of No Child Left Behind -- that domestic-educational version of the colonial war on Afghanistan, designed to stigmatize and punish poor students in every way conceivable -- every teacher in the town has been fired:

Every Central Falls teacher fired, labor outraged


The alleged reason for the firings: low test scores. This, of course, is a crock of stinking neoliberal horse$%^.

How exactly are these kids supposed to learn, when 25% of them are in families just barely scraping by on foodstamps? How are these schools supposed to function without enough books, teachers and materials? For thirty years, neoliberal governments have underfunded our K-12 system, slashed teacher salaries, and refused to pay for infrastructure.

I still remember my shock in 2004-2005 at discovering just how badly the K-12 classrooms had deteriorated in places like Eugene, Oregon and San Jose, California. These were not poor neighborhoods: Eugene is a university town and San Jose has the wealth of Silicon Valley. But there was no trace of that wealth in the schools. Art teachers had been laid off; class sizes were 35-40; textbooks were years out of date. And this was *before* the economic meltdown.

It doesn't have to be this way. We have the money, it's just that we spend $1 trillion every year on a wasteful and useless war machine. We piss away our national wealth by bombing, blasting and invading countries which never attacked us and don't threaten our security. We maintain 750 unnecessary overseas military bases, outfitted with satellite TV, internet, food courts and other amenities which most US schools would give their right arm to have. And we arm ourselves to the teeth against Cold War enemies who don't exist anymore -- Russia is a stable democracy, while China is one of our biggest trading partners and is undergoing significant democratization.

There's only one enemy which is threatening to destroy America: our own imperial stupidity.

Free Your Texts, And Your Mind Will Follow

One of the most unpleasant aspects of my day job is running constantly into the copyright fundamentalism of the print media. Over and over again, I find journals are unavailable, books are locked down, and articles are sequestered by idiotic copyright restrictions. The economic downturn has made things even worse, because publishers are frantically locking down everything they can get their tentacles on, in the vain hope this will somehow resuscitate their broken business models. All it ever does is restrict access to texts to super-rich neoliberal elites, which is precisely what those elites want, of course.

Other commercial interests are now trying to turn text-distribution into yet another corporate pigopoly. Their dream is to do to print what cellphone companies have done with text-messaging: technically speaking, it costs carriers almost nothing to send text-messages, but they routinely charge you 10 cents per message. There's no law to stop them, and US telcos routinely buy off Congress through hundreds of millions of dollars of campaign donations and lobbying.

Fortunately, the data requirements for storing text are far lower than music or video, so time -- a polite way of saying, the ever-evolving digital commons, plus the urgent need of the BRIC nations for English-language materials which are affordable to citizens with per capita incomes of less than $1000 per year -- is on our side.

Texts want to be free, just like information.

Education for All

One of the most remarkable social changes of the post-neoliberal era has been the dramatic expansion of tertiary and higher education throughout the industrializing world. Here are the numbers from UNESCO's 2010 Education for All report on tertiary education around the world, measured in millions of students per country. Note that the BRIC countries are just the tip of the iceberg:





For the sake of comparison, note that the comparable US figure rose from 13.769 million in 1999 to 17.759 million in 2007. While the developing world is still far behind in per capita terms, it is catching up fast, and its vast student body has become one of the central drivers of its own unique forms of democratization, industrialization and mediatization.

2010: A BRIC Odyssey

Ever since the meltdown of the Wall Street bubble, the world has faced an $800 billion question.

This is a number with some history.

For decades, the US was the consumer of last resort in the world economy. We had the biggest GDP, and consumption was a huge share of our economy, rising from 64% in the 1970s to 70% today.

Of course, the US was consuming beyond its means. What that meant was that in 2007, when neoliberalism's house of credit cards finally imploded, the world faced an $800 billion shortfall in net consumer demand. Here's the math: US GDP $14.2 trillion x 70% consumption share = $9.94 trillion of consumption. US retail sales went up by 8% a year during the early 2000s, adding a fresh $800 billion in annual global demand.

However, the US consumer is deeply indebted and will be retrenching for years to come. So who will pick up the slack?

Enter the BRICs.

The BRICs have been combating the global downturn in two ways: through increased government spending (classic Keynesianism) and by shifting their economic model from savings and exports to a balance between savings and internal consumption (a.k.a. Digital Age developmental statism).

Here are the numbers:

China is running a government deficit of 2% of GDP, or $109 billion. While the economy has continued to expand, China has been spending heavily on education, infrastructure and healthcare to forestall a downturn. Meanwhile, retail sales hit $1.84 trillion last year, and are projected to grow 15% this year (an extra $280 billion). Total stimulus: $109 billion + $280 billion = $389 billion

Russia's government deficit hit $74 billion or roughly 5% of GDP in 2009. In addition to tax revenues going down -- Russia was hard hit by the drop in the price of oil, though it has recovered quickly -- the government is spending heavily on domestic consumption. Pension payments are going up, and money is flowing into education and the high-tech sector. Retail sales were around $400 billion last year, and sales should increase 6% this year (an extra $24 billion). Total stimulus: $74 billion + $24 billion = $98 billion.

India's government deficit increased from 3% of GDP to 7% last year, a swing of $48 billion. The reason was not economic crisis -- growth remained respectable -- but the government's decision to make long-overdue investments in infrastructure, rural development and education. Retail sales were about $427 billion last year, and growth rates are poised to hit 8% (an extra $34 billion). Total stimulus: $48 billion + $34 billion = $81 billion.

Brazil's government swung from a 3% budgetary surplus to zero, a swing of about $45 billion. Brazil's slowdown was mild, but the Lula government launched a bunch of infrastructure projects to spur demand. Retail sales were around $368 billion and should grow 8% growth this year (an extra $22 billion). Total stimulus: $45 billion + $22 billion = $79 billion.

Hey presto, the BRICs alone are going to create $647 billion of fresh demand this year. This isn't quite enough to counterbalance the US slowdown, but gets us close. If the EU and Japan continue their stimulus, the world will have found its post-American economic engine, and things will dramatically improve.

State of The Meltdown Address

The US fiscal crisis just gets worse and worse. The CBPP's latest estimates are that the states will need $180 billion in new funding or additional cuts for fiscal 2010 (the 12 months running from this summer to summer of 2011).

However, this assumes the 2009 Federal stimulus as a baseline -- about $140 billion went to the states. This Federal aid is due to expire in December 2010. If that disappears, then all bets are off.

Why? Because there's nothing, absolutely nothing, driving the US recovery except Federal money. Fresh lending? Nonexistent. Debts? Still unpayable at 376% of GDP, still on the books of the banksters. Export markets? China's got those covered.

Simply, there is no new source of aggregate demand to replace the busted bubble or the massive loss of consumers' home equity and financial assets.

And there's nothing left to cut, because the states have already been cut to the bone. They need the $240 billion simply to stay on life-support. Any more cuts will transform this place into a slightly more expensive version of 1990s Russia -- a decrepit shambles of a former world power, blighted by a decaying infrastructure, mass misery, and the rule of thieving oligarchs bent on looting the country.

It doesn't have to be this way.

Just lopping off a quarter of our outrageously unnecessary trillion dollar war machine would free up enough money to bail out the states. But drone-bombing Afghani/Iraqi/Yemeni/pick-the-Central-Asian-country-of-your-choice villagers and subsidizing Goldman Sachs' bonus pool is just so much more important than having functioning schools, hospitals, or food for American kids, don't you agree?

Inflection Point

One of the central questions facing the post-American era has been, who will replace the US consumer as the source of final demand in the world-system.

Sometime later this year, I think we're going to find out.

In December of 2009, the GDP of the BRIC nations (Brazil, Russia, India, China) reached $9.17 trillion. To put this in perspective, that's about two-thirds the GDP of the US. It's slightly more than half the output of the 27-member European Union, and twice the size of Japan. It's amazing to think that back in 1999, the BRIC economies were only one third of their current size.

If the BRICs continue on their growth path -- and their leading indicators are turning sharply positive -- by 2011 their net additional GDP will roughly equal the comparable US figure (about $700 billion, assuming 2% annual growth).

However, the old model of running up export-surpluses to debt-crazed US consumers won't work anymore. Instead, the BRICs have to rely on internal demand. Not only that, but the BRICs, just like the rest of the planet, urgently need to green their economies, or there won't be a planet for any of us to live on anymore.

In a nutshell, the BRICs have to redirect some of their forex accumulation into indigenous consumption and green infrastructure (about $200 billion per year should do the trick).

Can they pull it off? The BRICs all have heavily regulated financial systems, reasonably effective states, low debt levels -- about 20% of GDP, on average -- and vast savings ($3.3 trillion in foreign exchange reserves). All they need is the political will.

And the BRICs aren't alone: Japan and Europe will help out, too.

We Need Jobs

For years and years, the defenders of neoliberalism (the likes of Bob Rubin, Larry Summers, et. al. -- a.k.a. the fat cats) argued that Bubble-nomics was the best of all possible systems, because even if wealth wasn't trickling down, the US was creating tons of jobs.

Not anymore.

The job-destruction unleashed by the Great Implosion of neoliberalism is staggering. Eight million jobs have been erased since 2008. Alas, the official 10% unemployment rate is the tip of the iceberg, because millions of Americans are dropping out of the workforce entirely. They are going to school, turning to the underground economy, or moving in with family. Add them in, and the unemployment rate easily hits 13% -- a level last seen in the Great Depression.

According to the BLS, the employment-to-population ratio, one of the best indicators of overall job loss, fell from 62.8 in January 2008 down to 58.2 in December 2009 (this is for folks 16 years and older).

58.2 is the lowest figure since 1983, and there's still no sign of a rebound.

When you break down the numbers by gender, it turns out the loss of jobs for male workers has no precedent in post-WW II history. The employment-to-population ratio for men averaged around 82 in the late 1940s and 1950s, before drifting slowly but steadily down over the decades to about 70 in the 1990s and early 2000s. Since 2008, the ratio collapsed down to 63.2.

The comparable figure for female employment was 30 in the 1950s, an era when women were expected to stay at home. Over the next decades, women entered the workforce in increasing numbers, and the ratio rose to an all-time high of 58 in 2000, before falling to the current 53.4 (the lowest since 1988).

In a nutshell, the job market is the worst it has ever been for men in 70 years, and the worst it has been for women in 20 years.

The free market is not going to solve this problem. Only Big Government has the resources to put 8 million people back to work. And there's plenty of work for them to do: our railroads, infrastructure, and schools are in dire need of investment, and our economy desperately needs greening.

Survival

I'm beginning to understand how ordinary Russians survived the meltdown of their Empire: after awhile, so many crises pile on so fast that there's no time to worry about any one of them. You start to realize that all the petty things which used to drive you nuts -- rule-crazy bureaucrats in the USSR, dollar-crazy billing agencies in the US -- are so many mosquitos in the Gloom, to paraphrase Sergei Lukyanenko's "Nightwatch" universe.

Russians lived off their dachas and garden produce for a decade, until Putin and the siloviki launched one of the most stupendous rescue operations of the century. We Americans will have to do something similar, by hunkering down on our foodstamps and government jobs.

Here's a post-Imperial guide to surviving the Great Crumble:

1. It's not you, it's The System. One in eight Americans has no job. One of four American kids isn't getting enough food. Our industrial base doesn't exist anymore. Our housing market is broken. Our media system is broken. Our political system is broken. Our banking system is broken. Our health care system is broken. Do not blame yourself or your unemployed neighbors for any of this stuff: the crash of this system is the crash of an unjust and unsustainable Empire, an Empire of toxic militarism and financial oligarchies. We need to replace it with a fairer, less violent, more democratic and more equitable society.

2. Zombie oligopolies. Right now, about a third of the US economy consists of globally uncompetitive oligopolies, whose main economic skill is buying off US politicians. We have a military-industrial complex (8% of the economy), a pharma-insco complex (8% of the economy), a Wall Street-Treasury complex (6% of the economy), and an automotive-sprawl complex (about 8% of the economy). (And don't get me started on our zombie mass media.) All leech off your tax revenues, some directly ($1 trillion in Federal spending on war) and some indirectly ($14 trillion in credit guarantees for Wall Street, hundreds of billions in tax subsidies for highways and McMansions). Instead of funding dead oligopolies, we should be spending our money on a public school-university complex, a renewable-green energy complex, a local utility-infrastructure complex, and a public media-information complex.

3. Embrace your inner pirate. Don't blow up your TV, use it to surf the web! Can't pay for overpriced, shoddy media? Tired of the lies of the mainstream media? Then don't pay for their lying swill -- download the media and information you want, when you want it, on the device of your choice. Use open source software to create your very own media, and share it with others. With 3 billion people already in the digital commons, and billions more on the way, you can't go wrong!

4. Never underestimate the restorative power of laughter. Being angry at the neoliberals does them too much credit. At this point, I laugh at DMCA take-down notices. I laugh at the mainstream media and its copyright fundamentalism. I laugh when I hear Wall Streeters talk about honesty and good governance. I'm not saying that we shouldn't be angry that neoliberalism completely fleeced us taxpayers. But the first step towards taking back what they stole is preserving our sense of humor -- because humor, as Patrick McGoohan noted all the way back in 1967, is the very essence of a democratic society.

5. Celebrate the joys of the commons. The utopian energies running loose in the traditional forms of the commons, the videogame culture, and the digital commons are simply astounding. More heartening still, these energies are beginning to spill over into the traditional media, loosening the stranglehold of corporate oligopolists and Imperial governments alike.

New Year, New Profile Pic

Presenting the new, improved EyeZilla (Lizardicus Uplinkus Piraticum), now with 56% more poco irony, a 38% increase in post-neoliberal ideology, titanium-strontium teeth, and USB-compatible claws. Despite no apparent source of liquidity, still more creditworthy than the US consumer.

Day jobs: tracking the BRICs, emergent media cultures, and 3D videogames.

Night job: tunnel-surfing.

Likes: espresso, data-monkeys and nanobears.

Dislikes: neoliberals, transnational capitalism.

Vampire Squid: Still Sucking American Blood

Earned $25,000 last year in honest toil? Prepare to fork over 25% of your income in taxes.

Scammed $2.3 billion through state-subsidized speculation and borrowing from the Federal Reserve at 0% interest and lending to everyone else at 5%? If you're Goldman Sachs, a.k.a. the Vampire Squid, you'll pay only $14 million in taxes, a tax rate of 1%.

Wall Street doesn't even have the buy off government officials anymore. That's because they ARE the government.