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21st Century Revolution
A collection of essays regarding the current global economic and ecological crisis and potential options for major political change.
Winner of 2012 Global Ebook Award and 2012 Readers' Favorites Award
The inspiraction for 21st Century Revolution was the undreamed of upheaval in the Arab world in 2011 - and implications this holds for genuine political reform in the US. The first section is about Occupy Wall Street and the new light the Occupy movement has shed on major deficiencies in our global financial and monetary systems. The other five sections look at growing evidence that global capitalism is in deep crisis and some of the major obstacles that make genuine political change difficult.
My book is intended for readers of all ages who are fed up with the corporate bias in the mainstream media.
Fairy Tale Economics
(November 24, 2011)
This is the first of three articles debunking the myths we are fed about the global economic crisis.
Unpacking the Lies About the Global Economic Crisis
The only way I know to make sense of the global economic crisis is to assume, until proven otherwise, that everything Obama, Wall Street and the corporate media tell us is a lie. The economy Obama, US Treasury Secretary Tim Geithner and Federal Reserve Chairman Ben Bernanke talk about is a fairy tale economy that bears no relation whatsoever to the real world. Obama, like most western leaders, makes out that the only way to "solve" the debt crisis is to tighten our belts and destroy the middle class via wage, benefit and social service cuts. Thanks to Occupy Wall Street, a new narrative about the global economic crisis is beginning to emerge. And guess what? Once people get a clear view of what's really happening, they come up with some fairly straightforward and painless solutions.
Debunking the Fairy Tale:
1. When is a recession not a recession?
When it's really a deflationary spiral.
Obama, Geithner and Bernanke keep telling us the current economic crisis is a recession. It's not. It's really a deflationary spiral. Deflation occurs when the economy shrinks. The US economy is clearly shrinking, just as Japan's economy has been doing for the last two decades. The US economy lost 10-20% of its real wealth in 2008 and has been slowly shrinking ever since. Consumer buying power continues to decrease, as Americans deplete their savings and experience wage and benefit cuts. Because people have less money to purchase goods and services, many businesses have quit producing them. This, in turn, causes more workers to be laid off.
2. The $15 trillion debt taxpayers owe Goldman Sachs represents money that never existed.
Contrary to popular misconception, the government doesn't issue money. Nearly all new money is created by private banks when they generate new loans. On average, most banks have only 7% of a new loan on deposit. The rest is generated out of thin air. This system started in 1694 when the Bank of England was created.
The federal government came by most of the $15 trillion debt by assuming -- through bailouts and other means - the toxic debts of Goldman and other major investment banks that were technically bankrupt. They were bankrupt either because they created trillions of dollars of toxic debt (out of thin air) for subprime mortgages for over-valued real estate that could never be repaid or because they bought this toxic debt from other banks.
The other thing Obama doesn't tell us is that there are still billions of dollars of toxic debt (again created out of thin air) that have yet to be "written down" (i.e. "written off" and subtracted from banks' balance sheets).
In 2008, trillions of dollars of toxic debt that wasn't transferred to government balance sheets was hidden by transferring it from weak banks to strong ones.
Any business other than a bank would be required to deduct these bad debts from their earnings in their annual report, when they declare their profits, dividends and CEO bonuses. Yet to protect the stock prices of bank prices, Obama colludes with Wall Street to keep this information secret.
3. The true unemployment figure.
Obama et al tell us the US unemployment rate is 9%. It's not. According to the Department of Labor's own numbers, it's really about 16% - or one out of every six Americans.
4. The US economy is in recovery -- NOT!
For more than a year Obama and the corporate media assured us we were in recovery. They seem to have backed away from that claim in the last few months. There has been no improvement whatsoever in the unemployment numbers, and bankruptcies and foreclosures continue to increase.
5. The difference between $700 billion and $12.5 trillion.
The figure we were giving for bank and corporate bail-outs was $700 billion. The true number, as Senator Bernie Saunders exposed last December, was $12.5 trillion. The Federal Reserve (using taxpayer money from the US Treasury) also issued billions of dollars in bail-out loans to foreign banks and car makers and individuals (including my New Zealand bank Westpac -- thanks for that). All this was done unconstitutionally without Congressional knowledge or approval. In fact, the Obama administration filed suit in federal court to prevent the release of these records and lost.
6. The US economy is shrinking, rather than growing.
Obama et al tell us that the US economy has started growing again, by a little under 1% per year. It hasn't. According to John Williams (at http://www.shadowstats.com) it actually shrank by 1% in 2010
7. It will be easy to repay global debt once growth returns to pre-2007 levels. Yeah right.
Repaying the $100 trillion debt (total of all government, household, bank and business debt) when total global wealth is $60 trillion is mathematically impossible, even with global growth levels of 3%.
Global growth (even with the help of China and India) will never return to pre-2007 levels because of fossil fuel scarcity and the skyrocketing cost of energy. The availability of cheap fossil fuels has allowed mankind a century of undreamed of scientific and technological innovation. All the cheap oil and natural gas is gone now. It's clear from Obama's energy policy, which promotes and supports risky high cost extraction techniques (deep sea oil drilling, fracking and tar sand extraction), that the President knows this. He just chooses not to share this information with the American public.
8. Guess who's printing money?
Obama et al tell us that "monetization," in which the federal government prints new money to generate new jobs and infrastructure programs, is out of the question because all "monetization" does is create hyperinflation. This is actually two lies rolled into one. Not only does "monetization" not create hyperinflation, but the Federal Reserve has been secretly "monetizing" the US debt since 2009. As of last week the Federal Reserve (using newly created US Treasury dollars), not China, is the largest holder of US debt. See http://cnsnews.com/news/article/fed-now-largest-owner-us-gov-t-debt-surpassing-china