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Time for change's Journal
Posted by Time for change in General Discussion
Tue Oct 13th 2009, 09:00 PM
If the Congress goes down the road I see them going down, they will institutionalize the corporate state in a way that will be severely damaging to any possibility of restoring democracy -- William Greider, in an interview with Bill Moyers
I fear what they're doing… is setting the crown for a corporate state…. And by that I mean a rather small but very powerful circle of financial institutions… also some industrial corporations… Too big to fail… protected by (government)… The leading banks and corporations… will have the means to monopolize democracy.” – William Greider, discussing the Geithner plan to address our economic crisis, in an interview with Bill Moyers, March 27, 2009.

It’s now been a little over a year since Congress agreed to bailout our banks, despite substantial opposition from the American people. In March 2009 our new Secretary of the Treasury, Tim Geithner, revealed plans to continue the bank bailout, which largely went into effect shortly afterwards. So how has that gone?

That depends upon whom you ask. If you listen to the corporate media you’d think everything is just fine. Typical of their opinions on this is a TV talking head that I recently heard bubbling over with praise for our economy. She mainly talked about the recovery of the stock market, concluding that this has resulted in large gains for American “taxpayers”. Taxpayers? She didn’t voice the slightest awareness that there is not a one to one correspondence between investors and taxpayers.

Actually, the banks have done quite well. But what about the rest of us?


The effects on ordinary Americans

Home foreclosures
There were 106,007 home foreclosures during the second quarter of 2009 – up 17% from the first quarter of the year. When Geithner was asked why efforts to help home owners haven’t helped more of them, he responded that:

They are trying to do everything to expand mortgage help, but the problem defies a quick fix. "It is very unlikely that we will say that the housing market has got to the place in the next few months where it no longer needs help."

Well, maybe that’s because our government gave vast amounts of money to failing banks instead of giving it to those who need it most. And maybe it’s also because we have a plan where “Lenders are paid to lower a borrower's monthly payments”. Maybe the plan would have worked better if the money was given to the borrowers instead of the lenders.

Unemployment
The official unemployment rate for September 2009 showed unemployment in the United States reaching 9.8%. However, it is widely accepted that the actual unemployment rate is far higher than that, when people who have given up looking for work are taken into account, or when under-employed persons are taken into account.

This graph puts the official unemployment rate into historical perspective: It rose during the Bush 41 administration, to reach as high as 8.2% in early 1993 – an important reason why Bush lost the 1992 presidential election. When Bill Clinton took over the presidency in January 1993, the unemployment rate was at 8.0%. It then consistently declined during the Clinton administration, reaching 3.7% by December 2000. It then rose, declined, and then rose again during the George W. Bush administration, reaching 8.5% by January 2008. The current official unemployment rate of 9.5% represents a modern-time high.

Jared Bernstein, Vice President Biden’s Economic Policy Advisor, in his book “Crunch – Why Do I Feel So Squeezed”, discusses the apparent paradox of a financial situation where so many Americans are doing so poorly in the presence of healthy “economic indicators”. The following excerpt applies to the “jobless recovery” of the Bush/Cheney administration, but the same principle applies to any “jobless recovery”:

Over the course of this highly touted economic expansion, poverty is up, working families’ real incomes are down…. By 2007, 44% said they lacked the money they needed “to make ends meet”…

If you feel squeezed, chances are it’s because you are squeezed. Most of the indicators that matter most to us in our everyday lives… are coming in at stress inducing levels, but GDP… keeps on truckin’. Something’s wrong, something fundamental…

The name of the problem is economic inequality… It’s a sign that something important is broken: the set of economic mechanisms and forces that used to broadly and fairly distribute the benefits of growth… unions, minimum wages… full employment… quality jobs, safety nets, and social

Economic inequality
Speaking of economic inequality, Paul Krugman recently commented on the most recent income inequality statistics in the United States, saying that they “didn’t get much attention but they’re truly amazing”. The important points to observe in the graph that is contained in the link are:

Income inequality rose precipitously during the 1920s under three Republican presidents, reaching a high just prior to the Stock Market Crash of 1929, which led to the Great Depression. Numerous measures put in place during FDR’s New Deal led to declining income inequality, which reached record lows late in his presidency and remained at record lows for four decades, until they began to rise again shortly after Ronald Reagan became president. With the corporate friendly, deregulation policies of the “Reagan Revolution”, income inequality began a steady rise, interrupted by a decline during the late years of the Clinton administration, and then a precipitous rise during the George W. Bush administration, reaching an all-time high for 2007, preceding our current economic recession (or depression). With current levels of unemployment, it seems extremely unlikely that the situation has reversed since 2007. The lesson that many economists take away from this is:

Massive corporate deregulation and tax cuts for the wealthy ==> severe income inequality ==> financial collapse.


In summary, our current financial situation looks pretty good from the standpoint of corporate CEOs, but dismal for ordinary Americans.


What was the magnitude of our bank bailout?

One of the biggest problems with our bailout of the banks is the lack of transparency of the whole process. According to the Special Inspector General for the TARP program:

TARP largely remains a program in which taxpayers are not being told what most of the TARP recipients are doing with their money and will not be told the full details of how their money is being invested.

But that’s not the worst of it. According to Nomi Prins and Christopher Hayes, writing in The Nation:

TARP was but a small fraction (roughly 4 percent) of the full $17.5 trillion (No, that’s not a typo) bailout and subsidization of the financial sector. The details of this total bailout are complicated, but the basic mechanisms aren’t beyond the average citizen’s grasp. We’re going to walk you through it.

Actually, I am not going to walk you through it, because it is too complex for me to understand (You can look it up at the link). But I’ll give you the bottom line of their article:

Given the banks’ newfound publicly sponsored financial health, Washington has little incentive to rock the boat by proposing serious reforms….

Lack of accountability seems to be something of a theme. Despite conducting themselves recklessly, compulsively, almost sociopathically, (the banks) got a lot of money to help maintain their lifestyle and assets. But what happens when they take all that money and double down on the wrong bet? Will they be back for another helping? Why wouldn’t they be? Given everything our government has said and done so far, and the meager reform ideas on the table, it’s very likely there will be another bad bet coming from the entire industry – and with it, the vaporizing of much of the assistance doled out to avoid that very occurrence.


We were warned by non-corporatist economists

As the Obama administration was considering putting the Geithner plan into effect – which was largely a continuation of the Bush administration plan – several eminent non-corporate economists warned them and us of the consequences. They used different words, but the basic message was quite similar: a reverse Robin Hood scheme, conducted behind closed doors:

Paul Krugman
This is what Paul Krugman had to say about Geithner’s bank bailout plan:

The Geithner scheme would offer a one-way bet: if asset values go up, the investors profit, but if they go down, the investors can walk away from their debt… This isn't really about letting markets work. It's just an indirect, disguised way to subsidize purchases of bad assets.

In other words, this is a gift from the American taxpayers to the banks.

Krugman said that Geithner’s plan is very similar to Hank Paulson’s abandoned "cash for trash" plan, and that it won’t work. Well, that makes sense to me. How could the economic condition of the average American be improved by handing over trillions of dollars to banks? And worse yet, Krugman added:

If this plan fails – as it almost surely will – it's unlikely that he'll (Obama) be able to persuade Congress to come up with more funds to do what he should have done in the first place.

Joseph Stiglitz
What Joseph Stiglitz had to say about the Geithner bailout plan was very similar to what Krugman said. He uses different words than Krugman, but the basic principle is the same:

The U.S. government plan to rid banks of toxic assets will rob American taxpayers by exposing them to too much risk and is unlikely to work as long as the economy remains weak…. The U.S. government is basically using the taxpayer to guarantee against downside risk on the value of these assets, while giving the upside, or potential profits, to private investors… Quite frankly, this amounts to robbery of the American people. I don't think it's going to work…

James Galbraith
James Galbraith, the son of John Kenneth Galbraith didn’t mince words in castigating Geithner’s plan:

The plan is yet another massive, ineffective gift to banks and Wall Street. Taxpayers, of course, will take the hit… The banks don't want to take their share of those losses because doing so will wipe them out. So they, and Geithner, are doing everything they can to pawn the losses off on the taxpayer…. In Geithner's plan, this debt won't disappear. It will just be passed from banks to taxpayers, where it will sit until the government finally admits that a major portion of it will never be paid back.

Robert Reich
Robert Reich, the Clinton administration’s first Secretary of Labor, also saw much similarity in the Geithner and Paulson plans (though he does say that Geithner’s plan is better). He explained how, through the actions of the Federal Reserve, Geithner’s plan could stick it to the American taxpayer for trillions:

In truth, the plan assumes trillions more from the Fed, based on the Fed's seemingly infinite capacity to backstop almost anyone putting up almost any collateral. The idea is to lure private investors into buying up the banks' toxic assets, by having the Fed limit their downside risks. If private investors pay too much, the Fed picks up the tab….

If the trillions of dollars the Fed has already committed and the trillions more it's about to commit can't be recouped, the federal debt explodes and you and I and other taxpayers are left holding the bag….

Reich noted the very poor track record of Wall Street thus far, and complained about the lack of transparency in Geithner’s plan:

The Fed is subject to almost no political oversight… They hide much of the true costs and risks to taxpayers of repairing the banking system. Those risks and costs should be put on the people who made risky bets on the banks in the first place – namely bank shareholders and creditors. Shareholders of the most troubled banks should be wiped out entirely. Bank creditors – except depositors – should take major hits. And top executives who were responsible should be canned. But Geithner and Bernanke don't want to take these steps… They think it's safer to put the costs and risks on taxpayers – especially in ways they can't see.

Dean Baker
Dean Baker said this about the Geithner plan:

Treasury secretary Timothy Geithner's latest bank bailout plan is another Rube Goldberg contraption intended to funnel taxpayer dollars to bankrupt banks, without being overly transparent about the process. The main mechanism is a government guarantee that would allow investors to buy junk with a 12-to-1 leverage ratio, where they only risk the downside on their own investment, not the borrowed money.


William Greider warns that we’re on the path to a corporate state

William Greider is a political journalist who has warned us many times in the past about the dire consequences of government becoming too cozy with the corporatocracy:

This will sound extreme to some people, but I came to it reluctantly. I fear what they're doing… in their design is setting the crown for a corporate state…. And by that I mean a rather small but very powerful circle of financial institutions the old Wall Street banks, famous names. But also some industrial corporations… Too big to fail. Yes, watched closely by the Federal Reserve and others in government, but also protected by them… The leading banks and corporations are sort of at the trough, ahead of everybody else in Washington, they will have the means to monopolize democracy. And I mean that literally. Some of my friends would say, hey, that already happened…. The corporate state is here…. The fact is, if the Congress goes down the road I see them going down, they will institutionalize the corporate state in a way that will be severely damaging to any possibility of restoring democracy.

In a recent article on the subject, Greider emphasized our dysfunctional political system – especially the disproportionate role of money in politics – as a major cause of our current crisis, as well as our movement towards a corporate state. He said:

Surely the political system itself is a root cause of the financial crisis. The swollen influence of financial interests pushed Congress and presidents to repeal regulation and look the other way as reckless excesses developed….


Deepening suspicions over our current state of affairs

Greider sees hope in the rising suspicions of numerous improprieties as a major cause of our current financial crisis:

Some Wall Street players suspect that certain bailouts engineered by the Treasury and the Federal Reserve were motivated by a logic never revealed to the public. The suspicion goes like this: the strange and costly rescue of AIG, an insurance company facing bankruptcy, was really intended to save Goldman Sachs, the premier investment house. If AIG went down, it would threaten Goldman and other big holders of AIG’s collapsing derivative contracts….

Congress, and even former Federal Reserve Chairman Paul Volcker have expressed serious concerns about our current course:

The White House plan, which rearranges the boxes among regulatory agencies and puts the Fed in charge, is stalled by rising skepticism in Congress and doubts expressed by establishment figures like former Federal Reserve chairman Paul Volcker, who is particularly wary of making the “too big to fail” doctrine into a permanent assumption… Volcker asked, “Will not the pattern of protection for the largest banks and their holding companies tend to encourage greater risk-taking… especially when compensation practices so greatly reward short-term success?”


Congressional investigations into the problem

Most important, Greider sees some hope in two investigations that are currently being conducted, despite the lack of attention to the problem by our corporate media, the lack of serious reforms to date, and the apparent lack of interest by our government in addressing the problem. He discusses these investigations in his most recent article, “Memo to Investigators: Dig Deep”.

One investigation is being undertaken by the 10-member Congressional Financial Crisis Inquiry Commission, chaired by Phil Angelides. Angelides seemed optimist about the investigation in his interview with Greider. He said:

If we stick to the hard facts, we might turn up some perpetrators, but our job is to accomplish something more than that. If we pursue all the facts, we can give the American people a clear understanding of what occurred during the last twenty years or so. What forces lit the fire that led to this explosion? What exactly happened with those financial firms that failed? What happened in regulation or at the Federal Reserve? …

The other investigation is being conducted by the House Committee on Oversight and Government Reform, chaired by Edolphus Towns. Greider notes that that committee:

broke a hoary taboo this summer – unprecedented in modern times – by issuing two subpoenas to the Federal Reserve… The Fed tried to duck and dodge, but given its tarnished reputation, it complied rather than provoke a fight it was bound to lose.

Greider discusses a long series of questions that should be addressed by these committees:

Why, for instance, hasn’t the Treasury bought up rotten assets from the troubled banks after demanding Congress put up $700 billion for that purpose?...A far larger crime may lurk at the center of the crisis – wholesale securities fraud…. More important, however, is the role of financial models for creating opportunities for deliberate acts of securities fraud. That’s what investigators can examine. What did the Wall Street firms know about the reliability of these models when they sold the securities? And what did they tell the buyers?


Our current crisis in the perspective of history

History is replete with stories of the powerful attempting to maintain an iron grasp over society and its wealth and resources. In our own country we saw the effects in the Great Depression that followed the Stock Market Crash of 1929. At that time we were very fortunate to be led by one of the two greatest presidents of our history. FDR was quite aware of the effects of economic inequality and the greedy powers behind it. In his 1936 Democratic Convention speech he called them “Economic Royalists”:

Out of this modern civilization economic royalists carved new dynasties. New kingdoms were built upon concentration of control over material things. Through new uses of corporations, banks and securities, new machinery of industry and agriculture, of labor and capital … the whole structure of modern life was impressed into this royal service…

The privileged princes of these new economic dynasties, thirsting for power, reached out for control over Government itself. They created a new despotism and wrapped it in the robes of legal sanction. In its service new mercenaries sought to regiment the people, their labor, and their property. And as a result the average man once more confronts the problem that faced the Minute Man…

FDR responded with the “New Deal”, a program that provided relief to those who needed it, reversed the economic inequality that had risen to record levels during the 1920s, and made great progress towards lifting us out of the Great Depression. So successful were those policies that for several decades no successful challenge could be mounted against them. Our next Republican president, Dwight D. Eisenhower, recognized the popularity and worth of FDR’s policies in a letter that he wrote to his brother on the subject:

Should any political party attempt to abolish social security, unemployment insurance, and eliminate labor laws and farm programs, you would not hear of that party again in our political history. There is a tiny splinter group that believes you can do these things. Among them are… a few Texas oil millionaires… Their number is negligible and they are stupid.

But few people living today remember those times. Beginning in the 1980s with the Reagan presidency, the Economic Royalists ascended again and began the dismantling of the New Deal. Greider gives a brief history of the financial aspects of this process:

Driven by Friedmanite ideology, Fed governors tipped the normal balance in favor of capital over labor, the financial sector over the productive economy. The result was numerous disorders, including the triumph of the financiers and swelling income inequality. Monetary policy became unreliable as “bubbles” inflated, followed by recession…. Debt exploded, accumulating far faster than economic growth. Instead of candidly addressing the central bank’s weakness, though, Alan Greenspan led cheers for the new order – right up to the day it collapsed….

And lastly, Greider notes that a thorough investigation is a first step towards a cure:

The investigation can restart the debate on more honest terms. Asking deeper questions about the true sources of the calamity is a first step toward developing authentic answers to the nation’s predicament.

Discuss (62 comments) | Recommend (+114 votes)
U.S. Democracy in Crisis
Time for change


The Democratic Underground was born on one of the worst days in U.S history – The day that the worst President in U.S. history took office.

Now, here we are 8 years later, and we’ve managed to remove that cancer from our nation and replace it with something much better. Notwithstanding my many ambivalent feelings towards President Obama, I have no doubt that he will be infinitely better for our country than his predecessor.

Yet despite that, our country has been terribly scarred from the events of the past eight years, and it continues to suffer from all of the root problems that brought us the worst President in our history in 2000 and 2004. Therefore, it is worth taking a look at the root problems that brought us to this sorry state of affairs.


MAJOR IMPEDIMENTS TO DEMOCRACY IN THE UNITED STATES

One thing that we must keep in mind when considering our current problems is that they are not new. They were greatly exacerbated by eight years of Bush administration misrule, but they did not start with George W. Bush and Dick Cheney.


Money in politics

All but the most naïve of the American citizenry know that the wealthy and powerful in our country routinely influence our local and national elections through huge campaign contributions. And they also know that they are generally well rewarded for their “contributions”. And they also know that bribery is presumably against the law in our country. Yet, on the rare occasion that our politicians are actually accused of bribery, our news media makes a great big deal over it, as if bribery is actually a rare event in American politics.

The end result is that a great many of our politicians do everything they can to make their wealthiest constituents happy with them, at the expense of everyone else. They do that with the knowledge that the voters they lose in doing so will be more than compensated for by the disinformation that will be paid for by their wealthiest constituents. I discuss this situation in more detail here, here, and here.

There are a few dots to connect here, but any reasonable assessment of American politics tells us that bribery is routinely used to buy and sell elections in our country. So routine is it that it is actually built into our system and legalized. But that fact is never overtly spoken of. To do so would imply that our system of government is as much or more an aristocracy than it is a democracy.

Bill Moyers, in his book “Moyers on Democracy”, explains the situation bluntly:

We have lost the ability to call the most basic transaction by its right name. If a baseball player stepping up to home plate were to lean over and hand the umpire a wad of bills before he called the pitch, we’d call that a bribe. But when a real estate developer buys his way into the White House and gets a favorable government ruling that wouldn’t be available to you or me, what do we call that? A “campaign contribution”.

Let’s call it what it is: a bribe.

The legality of contributing money to political candidates, with the implicit (though not explicit) understanding that that money will buy political favoritism, has been defended by both our courts and our Congress by sanctimoniously pointing to the free speech provisions in the First Amendment to our Constitution and claiming that money is speech. But the absurdity of that contention should be obvious to anyone with some primary school education. Speech is of value from a political standpoint (or any other standpoint) only when it is heard. But if one billionaire has one thousand times as much opportunity to speak through a medium which reaches millions than several thousand other people added together, the speech of that one billionaire will drown out the speech of most other people, thereby interfering with their right to free speech.


Election fraud

Electronic vote switching with DRE (direct-recording electronic) machines poses a great danger to the integrity of our election system – by virtue of its ability to switch a voter’s vote without being noticed by the voter. In other words, someone tries to vote for John Kerry, and the machine registers a vote for George Bush instead. What makes matters worse is that many or most of these machines don’t even produce a piece of paper with the vote on it, which can then later be used for a recount. So, if fraud is suspected there is no recourse. And worse yet is the fact that most of these machines use proprietary (secret) code to determine who the voter voted for.

We know for a fact that vote-switching occurred in the 2004 election. One study, based on voter reports to the national Electronic Incident Reporting System (EIRS), showed that vote switching incidents favored Bush over Kerry by a ratio of 12 to 1 nationally. A similar study showed that these vote switching incidents that favored Bush were 9 times as common in the heavily contested “swing states” than in non-swing states. To make the point that the EIRS reports represent only a small fraction of actual Election Day problems, an investigation by the Washington Post identified about 25 electronic voting machines in Youngstown, Mahoning County, Ohio, that were said to have been switching votes all day long. Yet only eight incidents of this nature from Mahoning County (all in favor of Bush) were reported to EIRS that day.

Clint Curtis, a computer programmer working in Florida prior to the 2004 election, testified before the Democratic staff of the House Judiciary Committee that he was requested in 2000 by his boss (at the request of a high level Republican operative, Tom Feeney) to “develop a prototype of a voting program that could alter the vote tabulation in an election and be undetectable”. Curtis’ testimony was followed by the death of Raymond Lemme, who while investigating Curtis’ allegations was found dead in a Georgia hotel room, just a couple weeks after telling Curtis that he had traced the corruption “all the way to the top”,

Another type of election fraud is the illegal purging of registered voters from the voter rolls. Like vote switching, the increasing computerization of voter registration is no doubt making it much easier to perpetrate this type of fraud on a mass basis.

This article describes a great deal of evidence that voter registration fraud played a major role in the 2004 presidential election, and in fact was probably the deciding factor in Ohio, which gave George Bush his electoral victory. Similarly, although the 2000 presidential election was stolen by a variety of means, voter registration fraud was quantitatively the most important method used. In 2000, the Florida Governor’s office used a computer program to purge tens of thousands of mostly black and Democratic voters.

There are many other means of election fraud that have been used in our country to destabilize our democracy. I discuss this issue in more detail, along with means for preventing election fraud, in this post.


Our corporate news media

If cash donated to their political campaigns is not enough to carry them through to victory, and if election fraud doesn’t happen to play a significant role, the corporate news media serves as another valuable tool for those seeking to sabotage our democracy. This problem overlaps with the role of money in politics, since those who own and control the corporate media are uniformly wealthy, and since it was their money that led to the acts that enabled our corporate media to become what it is today – Ronald Reagan’s veto of Democratic legislation to enforce the Fairness Doctrine in 1987, and the Telecommunications Act of 1996. This legislation allowed the monopoly consolidation of our news media to the point where today it is controlled by a very small number of extremely wealthy individuals.

Several excellent books have been written about the extent to which wealthy corporate interests control our news media today. I would highly recommend “Lapdogs – How the Press rolled Over for Bush”, by Eric Boehlert, “What Liberal Media – The Truth About BIAS and the News”, by Eric Alterman, and “Into the Buzzsaw – The Myth of a Free Press”, edited by Kristina Borjesson. And I have ranted about pseudo-journalists such as Tim Russert, who have made a largely successful, but hypocritical effort to appear unbiased to their viewers.

The bottom line, as Bill Moyers points out, is that the protection offered us by our First Amendment is based on the assumption of a separation of our government and a free press, which is supposed to protect us from government abuses. Moyers wrote this during the Bush administration:

What would happen, however, if the contending giants of big government and big publishing and broadcasting ever joined hands, ever saw eye to eye in putting the public's need for news second to free-market economics? That's exactly what's happening now under the ideological banner of "deregulation". Giant media conglomerates that our founders could not possibly have envisioned are finding common cause with an imperial state in a betrothal certain to produce not the sons and daughters of liberty but the very kind of bastards that issued from the old arranged marriage of church and state.

Consider the situation. Never has there been an administration so disciplined in secrecy, so precisely in lockstep in keeping information from the people at large and -- in defiance of the Constitution -- from their representatives in Congress. Never has the powerful media oligopoly ... been so unabashed in reaching like Caesar for still more wealth and power. Never have hand and glove fitted together so comfortably to manipulate free political debate, sow contempt for the idea of government itself, and trivialize the peoples' need to know.


Secrecy in government

Democracy suffers terribly when a nation’s citizens are uninformed – especially when they are uninformed with respect to the actions and motivations of their own government. If we don’t know what our government is doing, then how can we be expected to vote them out when they do something that we would consider deeply immoral had we known about it?

Consider war for example. If Americans understood the real motivations for its nation’s wars, they would probably be much more likely to strenuously object to those wars. That would make war much less politically feasible, and our country would therefore be led into war much less frequently than it has been in the past.

That is why I so hate the “national security” excuse for withholding information from us, the American people – which has become so routine that it is willingly or passively accepted by the good majority of Americans. I very much doubt that the “national security” excuse for withholding information from the American people has anything to do with national security more than 5% of the time. Rather, the reason for withholding such information from us is almost always something totally different. It is to blind us to the real reasons for war or other nefarious acts, so that we will accept them and willingly support or even risk our lives in their cause.


Rampant U.S. nationalism and the GAME

Two months ago I wrote a DU post that I titled “The GAME”, which I began by discussing “Unmentionable things in U.S. politics” – including such things as the stealing of a U.S. presidential election, calling American military or covert actions immoral rather than merely “misguided”, and imputing bad intentions rather than mere incompetence to a U.S. president.

I find this to be terribly repressive, not because I personally can’t mention these things, but because our elected representatives are under tremendous pressure not to discuss them. We elect them to represent us and our nation, and except for some rare courageous exceptions such as Dennis Kucinich, Cynthia McKinney, and Robert Wexler, they refuse to even talk about some of our very most important issues.

It has occurred to me that this provides the backdrop for a huge GAME that has been foisted upon us. A prerequisite of the GAME is to create an alternate reality that must be believed by a critical mass of people in order for the GAME to proceed. Why is that necessary? I believe it’s necessary because the reality is so terrible that if enough people consciously recognized it they would rise up and simply refuse to play the GAME.

Although the GAME’s masters set the rules, there are two related character traits of many Americans that cause them to play along: Rampant nationalism and a propensity for denial. Rampant nationalism is the attitude that our country is inherently better than any other country – so much so that it can do no wrong. This attitude is drummed into the American people from the time that most of us learn how to talk. We are made to feel that to believe or speak otherwise demonstrates a dangerous lack of “patriotism”, which makes us deserving of being shunned – or worse.

The other character trait that persuades too many Americans to play the GAME is denial. Believing terrible things about one’s country can be very painful. Accepting reality as it is, rather than as one would like it to be, can be very painful. To make this point, in a recent post titled “12 Things that Never Happened in American History”, I discuss the following official stories that we have been told (or not told):

The U.S. is not an imperialist country; FDR’s New Deal was not instrumental in ending the Great Depression; the Cold War was just about fighting totalitarian Communism; JFK was assassinated by a lone gunman; bribery is infrequent in American politics; Iran-Contra was not a criminal abuse of presidential power; U.S. presidential elections cannot be stolen; Bush and Cheney did everything they could to protect us against the 9/11 attacks; the Bush administration’s crimes are not serious enough to warrant impeachment or prosecution; and, we’re barely told about our nation’s killing of more than a million Iraqi civilians, the October Surprise, or Operation Northwoods.


CONSEQUENCES

These impediments to democracy work together to surrender great amounts of power into the hands of a small number of elites, who use that power in the cause of increasing their wealth and power at the expense of everyone else. It is a vicious cycle that is very difficult to break. Here are some of the major tragic consequences.


Rampant militarism and illegal aggression against sovereign nations

We are so often told how good and pure our nation and its people are that only a minority of Americans are aware of the extent of our many illegal and immoral activities. Many or most who aren’t aware of these activities would be shocked to learn about them and quite resistant to accepting that information as the truth.

In myriad instances we have overthrown or assisted in the overthrow of sovereign nations. In the good majority of these instances we have substituted a repressive right wing government for one that was much more responsive to the needs and desires of the nation’s citizenry. Sometimes genocide was used to accomplish our goals. The purpose of these activities has most often been to create a government that is friendlier to the desires of American businesses or corporations – though we always have some sort of rationalization for our actions.

In “Excuses for War” I discuss many of the phony excuses that the United States government has used to lead us into war, including its Indian wars, the Mexican-American War, the Spanish-American War, and the Vietnam War.

In “The Roots and Consequences of U.S. Overseas Imperialism” I note or discuss our covert and overt illegal and immoral overthrowing of the sovereign nations of Hawaii (1893), Cuba (1898), Puerto Rico (1898), the Philippines (1899-1902), Nicaragua (1910), Honduras (1911-1912), Iran (1953), Guatemala (1954), South Vietnam (1963), Chile (1973), Grenada (1983), Panama (1989), Afghanistan (2001), and Iraq (2003).

In “The Meaning of U.S. Imperialism, Genocide and Militarism” I note U.S. perpetrated genocides, as described in “State of Darkness” by David Model, including our atomic bombing of Japan (1945), those perpetrated against Guatemala (1954), Vietnam (1954-73), Indonesia (1965), Cambodia (1970-75), Laos (1969-74), and East Timor (1975), and our two wars against Iraq.

Other atrocities include our invasion of Cuba in 1961; U.S. Marine invasion of the Dominican Republic in 1965 to put down a rebellion against their repressive right wing government; U.S. military support of Haitian tyrant and mass murderer, Francois Duvalier; and numerous brutal interventions in several Latin American and African nations.


Massive Income and wealth inequality

Inequality of wealth in the United States is truly astounding – and it is increasing at a fast rate. In the United States in 2001, 1% of the population controlled 38% of the wealth, whereas the bottom 40% owned just 1%. That means that, on average, individuals in the top 1% owned about 1,500 times more wealth than individuals in the bottom 40%.

The rising level of income inequality in our country recently exceeded the point where it stood just prior to the stock market crash of 1929, which led to the worst depression in U.S. history. There are many who see a connection between the income inequality preceding that depression and our current situation. This graph, which plots income inequality measured as the ratio between the average income of the top 0.01% of U.S. families compared to the bottom 90%, over time, makes that point.

I discuss the subject of income and wealth inequality here, here, and here.


The loss of the rule of law

During the Bush Presidency I often argued that he should be impeached for his many crimes. Now that he can no longer be impeached, I have argued that our Justice Department should prosecute him for those crimes, and if it fails to do so then the International Criminal Court (ICC) should step in.

While Bush was still President, President Obama weighed in against impeachment, saying that impeachment should be reserved for only the most serious crimes. Now that he is President he has thus far given little or no indication that he intends to have his Justice Department prosecute George Bush or any other high level Bush administration official for their crimes. But if widespread torture, an illegal war of aggression, spying on American citizens, suspending of the right of habeas corpus, and numerous other violations of our Constitution don’t constitute serious crimes, then what does?

What would people say if a prosecuting attorney failed to prosecute a rapist and murderer simply because he had high level political connections? Who would accept that? Then why when far more serious crimes are committed by a President of the United States are there so many people who seem to think that it is ok to sit passively by and make no attempt to hold the perpetrators accountable for their crimes?

I’ll tell you why. It’s like I said earlier in this post. Saying that a former U.S. President might be guilty of prosecutable crimes is simply against the rules of the GAME. Given that and the failure to hold the Reagan administration accountable for its Iran-Contra crimes, George Bush and Dick Cheney connected the dots and thought that they might be able to get away with just about anything. Testing that assumption by moving ahead with prosecutions might be politically risky for the Obama administration. The Republican Party would no doubt raise holy hell if there was an attempt to prosecute high level Bush administration officials.

Consequently, we live in country in which, protestations to the contrary notwithstanding, certain people are indeed above the law. That fact, taken together with all of the impediments to democracy discussed in the first part of this post, means that democracy and the rule of law in our country are in grave danger. Indeed, some believe that we narrowly averted a military coup perpetrated by the Bush administration.

The American people and their leaders need to reassess what our country stands for. Is our democracy important enough to take steps to remove the role of money in politics, reform our election system, break up the corporate monopoly on our news media, require government actions to be much more transparent than they now are, and dare to look more objectively at who we are and what we do? Can we give up imperialism and warfare for the sake a world in which nations live and work together to further the cause of peace and justice? Can we make our nation one in which all of its citizens truly have the opportunity for life, liberty and the pursuit of happiness? And do our laws apply to all people, not just to those who lack the political influence to avoid them?

If we think that these things are important we have a great deal of work to do, lest our country sinks into a tyranny from which it may never recover.
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