The Liberty Beacon

The Liberty Beacon





Introduction by Mary Carmel (TLB)

The following interview with author Michael Hudson is a tad lengthier than other daily articles, but well worth the read! I found that the language was easily understood for readers that are NOT economists. It really pulls the global, financial & political environment that we live in, under a spotlight that allows us to comprehend how the world population has fallen prey to both of them for centuries. There is much history attached to the marriage of economics and imperialistic governments… MC



The following is a transcript of CounterPunch Radio – Episode 19(originally aired September 21, 2015). Eric Draitser interviews Michael Hudson.

Eric Draitser: Today I have the privilege of introducing Michael Hudson to the program. Doctor Hudson is the author of the new book: Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy, available in print on Amazon and an e-version on CounterPunch. Michael Hudson, welcome to CounterPunch Radio.

Michael Hudson: It’s good to be here.

ED: Thanks so much for coming on. As I mentioned already, the title of your book – Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy – is an apt metaphor. So parasitic finance capital is really what you’re writing about. You explain that it essentially survives by feeding off what we might call the real economy. Could you draw out that analogy a little bit? What does that mean? How does finance behave like a parasite toward the rest of the economy?

MH: Economists for the last 50 years have used the term “host economy” for a country that lets in foreign investment. This term appears in most mainstream textbooks. A host implies a parasite. The term parasitism has been applied to finance by Martin Luther and others, but usually in the sense that you just talked about: simply taking something from the host.

But that’s not how biological parasites work in nature. Biological parasitism is more complex, and precisely for that reason it’s a better and more sophisticated metaphor for economics. The key is how a parasite takes over a host. It has enzymes that numb the host’s nervous system and brain. So if it stings or gets its claws into it, there’s a soporific anesthetic to block the host from realizing that it’s being taken over. Then the parasite sends enzymes into the brain. A parasite cannot take anything from the host unless it takes over the brain.

The brain in modern economies is the government, the educational system, and the way that governments and societies make their economic policy models of how to behave. In nature, the parasite makes the host think that the free rider, the parasite, is its baby, part of its body, to convince the host actually to protect the parasite over itself.

That’s how the financial sector has taken over the economy. Its lobbyists and academic advocates have persuaded governments and voters that they need to protect banks, and even need to bail them out when they become overly predatory and face collapse. Governments and politicians are persuaded to save banks instead of saving the economy, as if the economy can’t function without banks being left in private hands to do whatever they want, free of serious regulation and even from prosecution when they commit fraud. This means saving creditors – the One Percent – not the indebted 99 Percent.

It was not always this way. A century ago, two centuries ago, three centuries ago and all the way back to the Bronze Age, almost every society has realized that the great destabilizing force is finance – that is, debt. Debt grows exponentially, enabling creditors ultimately to foreclose on the assets of debtors. Creditors end up reducing societies to debt bondage, as when the Roman Empire ended in serfdom.

About a hundred years ago in America, John Bates Clark and other pro-financial ideologues argued that finance is not external to the economy. It’s not extraneous, it’s part of the economy, just like landlords are part of the economy. This means that if the financial sector takes more revenue out of the economy as interest, fees or monopoly charges, it’s because finance is an inherent and vital part of the economy, adding to GDP, not merely siphoning it off from producers to pay Wall Street and the One Percent. So our economic policy protects finance as if it helps us grow, not siphons off our growth.

A year or two ago, Lloyd Blankfein of Goldman Sachs said that the reason Goldman Sachs’ managers are paid more than anybody else is because they’re so productive. The question is, productive of what? The National Income and Product Accounts (NIPA) say that everybody is productive in proportion to the amount of money they make/take. It doesn’t matter whether it’s extractive income or productive income. It doesn’t matter whether it’s by manufacturing products or simply taking money from people, or simply by the fraud that Goldman Sachs, Citigroup, Bank of America and others paid tens of millions of dollars in fines for committing. Any way of earning income is considered to be as productive as any other way. This is a parasite-friendly mentality, because it denies that there’s any such thing as unearned income. It denies that there’s a free lunch. Milton Friedman got famous for promoting the idea that there’s no such thing as a free lunch, when Wall Street knows quite well that this is what the economy is all about. It’s all about how to get a free lunch, with risks picked up by the government. No wonder they back economists who deny that there’s any such thing!

ED: To get to the root of the issue, what’s interesting to me about this analogy that we’re talking about is that we hear the term neoliberalism all the time. It is an ideology I that’s used to promote the environment within which this parasitic sort of finance capital can operate. So could you talk a bit about the relationship between finance capital and neoliberalism as its ideology.

MH: Today’s vocabulary is what Orwell would call DoubleThink. If you’re going to call something anti-liberal and against what Adam Smith and John Stuart Mill and other classical economists described as free markets, you pretend to be neoliberal. The focus of Smith, Mill, Quesnay and the whole of 19th-century classical economics was to draw a distinction between productive and unproductive labor – that is, between people who earn wages and profits, and rentiers who, as Mill said, “get rich in their sleep.” That is how he described landowners receiving groundrent. It also describes the financial sector receiving interest and “capital” gains.

The first thing the neoliberal Chicago School did when they took over Chile was to close down every economics department in the country except the one they controlled at the Catholic University. They started an assassination program of left wing professors, labor leaders and politicians, and imposed neoliberalism by gunpoint. Their idea is you cannot have anti-labor, deregulated “free markets” stripping away social protections and benefits unless you have totalitarian control. You have to censor any idea that there’s ever been an alternative, by rewriting economic history to deny the progressive tax and regulatory reforms that Smith, Mill, and other classical economists urged to free industrial capitalism from the surviving feudal privileges of landlords and predatory finance.

This rewriting of the history of economic thought involves inverting the common vocabulary that people use. So, the idea of the parasitism is to replace the meaning of everyday words and vocabulary with their opposite. It’s Double Think.

Democratic vs. oligarchic government and their respective economic doctrines

ED: I don’t want to go too far off on a tangent, but you mentioned the example of Chile’s 1973 coup and the assassination of Allende to impose the Pinochet dictatorship. That was a Kissinger/Nixon operation as we know, but what’s interesting about that is Chile was transformed into a sort of experimental laboratory to impose the Chicago school economic model of what we now would call neoliberalism. Later in our conversation I want to talk a bit about some recent laboratories we have seen in Eastern Europe, and now in Southern Europe as well. The important point about neoliberalism is the relationship between totalitarian government and this form of economics.

MH: That’s right. Neoliberals say they’re against government, but what they’re really against is democratic government. The kind of governments they support are pre-referendum Greece or post-coup Ukraine. As Germany’s Wolfgang Schäuble said, “democracy doesn’t count.” Neoliberals want the kind of government that will create gains for the banks, not necessarily for se the economy at large. Such governments basically are oligarchic. Once high finance takes over governments as a means of exploiting the 99 Percent, it’s all for active government policy – for itself.

Aristotle talked about this more than 2,000 years ago. He said that democracy is the stage immediately proceeding oligarchy. All economies go through three stages repeating a cycle: from democracy into oligarchy, and then the oligarchs make
2KillingTheHost_Cover_rulethemselves hereditary. Today, Jeb Bush wants to abolish the estate tax to help the emerging power elite make itself into a hereditary aristocracy. Then, some of the aristocratic families will fight among themselves, and take the public into their camp and promote democracy, so you have the cycle going all over again. That’s the kind of cycle we’re having now, just as in ancient Athens. It’s a transition from democracy to oligarchy on its way to becoming an aristocracy of the power elite.

ED: I want to return to the book in a second but I have to interject that one particular economist hasn’t been mentioned yet: Karl Marx. It’s an inversion of Marx as well, because Marx’s labor theory of value was that that value ultimately is derived from labor. Parasitic finance capital is the opposite of that. It may increase prices without value.

MH: Correct, but I should point out that there’s often a misinterpretation of the context in which the labor theory of value was formulated and refined. The reason why Marx and the other classical economists – William Petty, Smith, Mill and the others – talked about the labor theory of value was to isolate that part of price that wasn’tvalue. Their purpose was to define economic rent as something that was not value. It was extraneous to production, and was a free lunch – the element of price that is charged to consumers and others that hasno basis in labor, no basis in real cost, but is purely a monopoly price or return to privilege. This was mainly a survival of the feudal epoch, above all of the landed aristocracy who were the heirs of the military conquers, and also the financial sector of banking families and theirheirs.

The aim of the labor theory of value was to divide the economy between excessive price gouging and labor. The objective of the classical economists was to bring prices in line with value to prevent a free ride, to prevent monopolies, to prevent an absentee landlord class so as to free society from the legacy of feudalism and the military conquests that carved up Europe’s land a thousand years ago and that still underlies our property relations.

The concept and theory of economic rent

ED: That’s a great point, and it leads me into the next issue that I want to touch on. You’ve mentioned the term already a number of times: the concept of economic rent. We all know rent in terms of what we have to pay every month to the landlord, but we might not think about what it means conceptually. It’s one of the fabrics with which you’ve woven this book together. One of the running themes, rent extraction, and its role in the development of what we’ve now termed this parasitic relationship. So, explain for laymen what this means – rent extraction – and how this concept evolved.

MH: To put the concept of economic rent in perspective, I should point out when I went to get my PhD over a half a century ago, every university offering a graduate economics degree taught the history of economic thought. That has now been erased from the curriculum. People get mathematics instead, so they’re unexposed to the concept of economic rent as unearned income. It’s a concept that has been turned on its head by “free market” ideologues who use “rent seeking” mainly to characterize government bureaucrats taxing the private sector to enhance their authority – not free lunchers seeking to untax their unearned income. Or, neoclassical economists define rent as “imperfect competition” (as if their myth of “perfect competition” really existed) stemming from “insufficient knowledge of the market,” patents and so forth.

Most rent theory was developed in England, and also in France. English practice is more complex than America. The military conquers imposed a pure groundrent fee on the land, as distinct from the building and improvements. So if you buy a house from a seller in England, somebody else may own the land underneath it. You have to pay a separate rent for the land. The landlord doesn’t do anything at all to collect land rent, that’s why they call them rentiers or coupon clippers. In New York City, for example, Columbia University long owned the land underneath Rockefeller Center. Finally they sold it to the Japanese, who lost their shirt. This practice is a carry-over from the Norman Conquest and its absentee landlord class.

The word “rent” originally was French, for a government bond (rente). Owners received a regular income every quarter or every year. A lot of bonds used to have coupons, and you would clip off the coupon and collect your interest. It’s passively earned income, that is, income not actually earned by your own labor or enterprise. It’s just a claim that society has to pay, whether you’re a government bond holder or whether you own land,

This concept of income without labor – but simply from privileges that had been made hereditary – was extended to the ideas of monopolies like the East India Company and other trade monopolies. They could produce or buy goods for, let’s say, a dollar a unit, and sell them for whatever the market will bear – say, $4.00. The markup is “empty pricing.” It’s pure price gouging by a natural monopoly, like today’s drug companies.

To prevent such price gouging and to keep economies competitive with low costs of living and doing business, European kept the most important natural monopolies in the public domain: the post office, the BBC and other state broadcasting companies, roads and basic transportation, as well as early national airlines. European governments prevented monopoly rent by providing basic infrastructure services at cost, or even at subsidized prices or freely in the case of roads. The guiding idea is for public infrastructure – which you should think of as a factor of production along with labor and capital – was to lower the cost of living and doing business.

But since Margaret Thatcher led Britain down the road to debt peonage and rent serfdom by privatizing this infrastructure, she and her emulators other countries turned them into tollbooth economies. The resulting economic rent takes the form of a rise in prices to cover interest, stock options, soaring executive salaries and underwriting fees. The economy ends up being turned into a collection of tollbooths instead of factories. So, you can think of rent as the “right” or special legal privilege to erect a tollbooth and say, “You can’t get television over your cable channel unless you pay us, and what we charge you is anything we can get from you.”

This price doesn’t have any relation to what it costs to produce what they sell. Such extortionate pricing is now sponsored by U.S. diplomacy, the World Bank, and what’s called the Washington Consensus forcing governments to privatize the public domain and create such rent-extracting opportunities.

In Mexico, when they told it to be more “efficient” and privatize its telephone monopoly, the government sold it to Carlos Slim, who became one of the richest people in the world by making Mexico’s phones among the highest priced in the world. The government provided an opportunity for price gouging. Similar high-priced privatized phone systems plague the neoliberalized post-Soviet economies. Classical economists viewed this as a kind of theft. The French novelist Balzac wrote about this more clearly than most economists when he said that every family fortune originates in a great theft. He added that this not only was undiscovered, but has come taken for granted so naturally that it just doesn’t matter.

If you look at the Forbes 100 or 500 lists of each nation’s richest people, most made their fortunes through insider dealing to obtain land, mineral rights or monopolies. If you look at American history, early real estate fortunes were made by insiders bribing the British Colonial governors. The railroad barrens bribed Congressmen and other public officials to let them privatize the railroads and rip off the country. Frank Norris’s The Octopus is a great novel about this, and many Hollywood movies describe the kind of real estate and banking rip-offs that made America what it is. The nation’s power elite basically begun as robber barons, as they did in England, France and other countries.

The difference, of course, is that in past centuries this was viewed as corrupt and a crime. Today, neoliberal economists recommend it as the way to raise “productivity” and make countries wealthier, as if it were not the road to neofeudal serfdom.

The Austrian School vs. government regulation and pro-labor policies

ED: I don’t want to go too far off on a tangent because we have a lot to cover specific to your book. But I heard an interesting story when I was doing a bit of my own research throughout the years about the evolution of economic thought, and specifically the origins of the so-called Austrian School of Economics – people like von Mises and von Hayek. In the early 20th century they were essentially, as far as I could tell, creating an ideological framework in which they could make theoretical arguments to justify exorbitant rent and make it seem almost like a product of natural law – something akin to a phenomenon of nature.

MH: The key to the Austrian School is their hatred of labor and socialism. It saw the danger of democratic government spreading to the Habsburg Empire, and it said, “The one thing we have to stop is democracy. Their idea of a free market was one free of democracy and of democratic government regulating and taxing wealthy rentiers. It was a short step to fighting in the streets, using murder as a “persuader” for the particular kind of “free markets” they wanted – a privatized Thatcherite deregulated kind. To the rentiers they said: “It’s either our freedom or that of labor.”

Kari Polanyi-Levitt has recently written about how her father, Karl Polanyi, was confronted with these right-wing Viennese. His doctrine was designed to rescue economics from this school, which makes up a fake history of how economics and civilization originated.

One of the first Austrian’s was Carl Menger in the 1870s. His “individualistic” theory about the origins of money – without any role played by temples, palaces or other public institutions – still governs Austrian economics. Just as Margaret Thatcher said, “There’s no such thing as society,” the Austrians developed a picture of the economy without any positive role for government. It was as if money were created by producers and merchants bartering their output. This is a travesty of history. All ancient money was issued by temples or public mints so as to guarantee standards of purity and weight. You can read Biblical and Babylonian denunciation of merchants using false weights and measures so see why money had to be public. The major trading areas were agora spaces in front of temples, which kept the official weights and measures. And much exchange was between the community’s families and the public institutions.

Most important, money was brought into being not for trade (which was conducted mainly on credit), but for paying debts. And most debts were owed to the temples and palaces for pubic services or tribute. But to the Austrians, the idea was that anything the government does to protect labor, consumers and society from rentiers and grabbers is deadweight overhead.

Above all, they opposed governments creating their own money, e.g. as the United States did with its greenbacks in the Civil War. They wanted to privatize money creation in the hands of commercial banks, so that they could receive interest on their privilege of credit creation and also to determine the allocation of resources.

Today’s neoliberals follow this Austrian tradition of viewing government as a burden, instead of producing infrastructure free of rent extraction. As we just said in the previous discussion, the greatest fortunes of our time have come from privatizing the public domain. Obviously the government isn’t just deadweight. But it is becoming prey to the financial interests and the smashers and grabbers they have chosen to back.

ED: You’re right, I agree 100%. You encounter this ideology even in the political sociological realm like Joseph Schumpeter, or through the quasi-economic realm like von Hayek in “The Road to Serfdom.”

MH: Its policy conclusion actually advocates neo-serfdom. Real serfdom was when families had to pay all their income to the landlords as rent. Centuries of classical economists backed democratic political reform of parliaments to roll back the landlords’ power (and that of bankers). But Hayek claimed that this rollback was the road toserfdom, not away from it. He said democratic regulation and taxation of rentiers is serfdom. In reality, of course, it’s the antidote.

ED: It’s the inversion you were talking about earlier. We’re going to go into a break here in a minute but before we do I want to touch on one other point that is important in the book, again the book, Killing the Host: How Financial Parasites and Debt Bondage Destroyed the Global Economy, available from CounterPunch – very important that people pick up this book.

MH: And from Amazon! You can get a hard copy for those who don’t want to read on computers.

Finance as the new mode of warfare

ED: Yes, and on Amazon as well, thank you. This issue that I want to touch on before we go to the break is debt. On this program a couple of months ago I had the journalist John Pilger. He and I touched on debt specifically as a weapon, and how it is used as a weapon. You can see this in the form of debt enslavement, if you want to call it that, in postcolonial Africa. You see the same thing in Latin America where, Michael, I know you have a lot of experience in Latin America in the last couple of decades. So let’s talk a little bit, if we could, before we go to the break, about debt as a weapon, because I think this is an important concept for understanding what’s happening now in Greece, and is really the framework through which we have to understand what we would call 21st-century austerity.

MH: If you treat debt as a weapon, the basic idea is that finance is the new mode of warfare. That’s one of my chapters in the book. In the past, in order to take over a country’s land and its public domain, its basic infrastructure and its mineral resources, you had to have a military invasion. But that’s very expensive. And politically, almost no modern democracy can afford a military invasion anymore.

So the objectives of the financial sector – of Wall Street, the City of London or Frankfurt in Germany – is to obtain the land. You can look at what’s happening in Greece. What its creditors, the IMF and European Central Bank (ECB) want are the Greek islands, and they want the gas rights in the Aegean Sea. They want whatever buildings and property there is, including the museums.

Matters are not so much different in the private sector. If you can get a company or individual into debt, you can strip away the assets they have when they can’t pay. A Hayek-style government would block society from protecting itself against such asset stripping. Defending “property rights” of creditors, such “free market” ideology deprives the rest of the economy – businesses, individuals and public agencies. It treats debt writedowns as the road to serfdom, not the road awayfrom debt dependency.

In antiquity, private individuals obtained labor services by making loans to families in need, and obliging their servant girls, children or even wives to work off the loan in the form of labor service. My Harvard-based archaeological group has published a series of five books that I co-edited, most recently Labor in the Ancient World. (It is available on Amazon.) Creditors (often palace infrastructure managers or collectors) would get people into bondage. When new Bronze Age rulers started their first full year on the throne, it was customary to declare an amnesty to free bond servants and return them to their families, and annul personal debts as well as to return whatever lands were forfeited. So in the Bronze Age, debt serfdom and debt bondage was only temporary. The biblical Jubilee law was a literal translation of Babylonian practice that went back two thousand years.

In America, in colonial times, sharpies (especially from Britain) would lend farmers money that they knew the farmer couldn’t pay, then they would foreclose just before the crops came in. Right now you have corporate raiders, who are raiding whole companies by forcing them into debt, and then smashing and grabbing. You now have the IMF, European Central Bank and Washington Consensus taking over whole countries like Ukraine. The tactic is to purposely lend them the money that clearly cannot be repaid, and say, “Oh you cannot pay? Well, we’re not going to take a loss. We have a solution.” The solution is to sell off public enterprises, land and natural resources. In Greece’s case, 50 billion euros of its property, everything that it has in the public sector. The country is to be sold off to foreigners (including domestic oligarchs working out of their offshore accounts). Debt leverage is thus the way to achieve what it took armies to win in times past.

ED: Exactly. One last point on that as well. I want to get your comment on and we see this in post-colonial Africa, especially when the French and the British had to nominally give up control of their colonies. You saw debt become an important tool to maintain hegemony within their spheres of influence. Of course, asset stripping and seizing control, smashing and grabbing was part of that. But also it is the debt servicing payments, it is the cycle of debt repayment and taking new loans on top of original loans to service the original loans – this process this cycle is also really an example of this debt servitude or debt bondage.

MH: That’s correct, and mainstream economics denies any of this. It began with Ricardo, who’s brothers were major bankers at the time, and he himself was the major bank lobbyist in England. Right after Greece won its independence from Turkey, the Ricardo brothers made a rack-renting loan to Greece at far below par (that is, below the face value that Greece committed itself to pay). Greece tried to pay over the next century, but the terms of the loan ended up stripping and keeping it on the edge of bankruptcy well into the 20th century.

But Ricardo testified before Parliament that there could be no debt-servicing problem. Any country, he said, could repay the debts automatically, because there is an automatic stabilization mechanism that enables every country to be able to pay. This is the theory that underlines Milton Friedman and the Chicago School of monetarism: the misleading idea that debt cannot be a problem.

That’s what’s taught now in international trade and financial textbooks. It’s false pleading. It draws a fictitious “What If” picture of the world. When criticized, the authors of these textbooks, like Paul Samuelson, say that it doesn’t matter whether economic theory is realistic or not. The judgment of whether an economic theory is scientific is simply whether it is internally consistent. So you have these fictitious economists given Nobel Prizes for promoting an inside out, upside down version of how the global economy actually works.

ED: One other thing that they no longer teach is what used to be called political economy. The influence of the Chicago School, neoliberalism and monetarism has removed classical political economy from academia, from the Canon if you will. Instead, as you said, it’s all about mathematics and formulas that treat economics like a natural science, when in fact it really should be more of a historically grounded social science.

MH: The formulas that they teach don’t have government in them,. If you have a theory that everything is just an exchange, a trade, and that there in’t any government, then you have a theory that has nothing to do with the real world. And if you assume that the environment remains constant instead of using economics to guide public and national policy, you’re using economics for the opposite of what the classical economists did. Adam Smith, Mill, Marx, Veblen – they all developed their economic theory to reform the world. The classical economists were reformers. They wanted to free society from the legacy of feudalism – to get rid of land rent, to take money creation and credit creation into the public domain. Whatever their views, whether they were right wingers or left wingers, whether they were Christian socialists, Ricardian socialists or Marxian socialists, all the capitalist theorists of the 19th century called themselves socialists, because they saw capitalism as evolving into socialism.

But what you now have, since World War I, is a reaction against this, stripping away of the idea that governments have a productive role to play. If government is not the director and planner of the economy, then who is? It’s the financial sector. It’s Wall Street. So the essence of neoliberalism that you were mentioning before, is indeed a doctrine of central planning. It states that the central planning should be done by Wall Street, by the financial sector.

The problem is, what is the objective of central planning by Wall Street? It’s not to raise living standards, and it’s not to increase employment. It is to smash and grab. That is the society we’re in now.

A number of chapters of my book (I think five), describe how the Obama administration has implemented this smash and grab, doing the exact opposite of what he promised voters. Obama has implemented the Rubin-omics [Robert Rubin] doctrine of Wall Street to force America into what looks like a chronic debt depression.

ED: Exactly right. I couldn’t agree more. Let’s take a short break and we’ll continue the discussion. Again, I’m chatting with Michael Hudson about his new book, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy.

The case of Latvia: Is it a success story, or a neoliberal disaster?

ED: I want to go back to some of the important issues that we introduced or alluded to in the first part of our discussion. As I was mentioning to you off-air, a couple years ago I twice interviewed your colleague Jeffrey Sommers, with whom you’ve worked and co-published a number of papers. We talked a lot about many of the same issues that you and I are touching on. Specifically Sommers – and I know you as well – did a lot of work in Latvia, a country in the former Soviet space in Eastern Europe on the Baltic Sea. Your book has a whole chapter on it, as well as references throughout the book.

So let’s talk about how Latvia serves as a template for understanding the austerity model. It is touted by technocrats of the financial elite as a major success story – how austerity can work. I find it absurd on so many different levels. So tell us what happened in Latvia, what the real costs were, and why neoliberals claim it as a success story.

MH: Latvia is the disaster story of the last two decades. That’s why I took it as an object lesson. You’re right, it was Jeff Sommers who first brought me over to Latvia. I then became Director of Economic Research and Professor of Economics at the Riga Graduate School of Law.

When Latvia was given its independence when the Soviet Union broke up in 1991, a number of former Latvians had studied at George Washington University, and they brought neoliberalism over there – the most extreme grabitization and de-industrialization of any country I know. Latvians, Russians and other post-Soviet countries were under the impression that U.S. advisors would help them become modernized like the U.S. economy – with high living and consumption standards. But what they got was advice to emulate American experience. It got something just the opposite – how to enable foreign investors and bankers to carve it up, dismantle its industry and become a bizarre neoliberal experiment.

You may remember the Republican presidential candidate Steve Forbes, who in 2008 proposed a flat tax to replace progressive taxation. The idea never could have won in the United States, but Latvia was another story. The Americans set the flat tax at an amazingly low 12 percent of income – and no significant property tax on real estate or capital gains. It was a financial and real estate dream, and created a classic housing and financial bubble.

Jeff and I visited the head of the tax authority, who told us that she was appointed because she had done her PhD dissertation on Latvia’s last land value assessment – which was in 1917. They hadn’t increased the assessments since then, because the Soviet economy didn’t have private land ownership and didn’t even have a concept of rent-of-location for planning purposes. (Neither did Russia.)

Latvia emerged from the Soviet Union without any debt, and also with a lot of real estate and a highly educated population. But its political insiders turned over most of the government enterprises to themselves. Latvia had been a computer center and also the money-laundering center of the Soviet leadership already in the late 1980s (largely as a byproduct of Russian oil exports through Ventspils), and Riga remains the money-laundering city for today’s Russia.

Privatizing housing and other property led to soaring real estate prices. But this bubble wasn’t financed by domestic banks. The Soviet Union didn’t have private banks, because the government had simply created the credit to fund the economy as needed. The main banks in a position to lend to Latvia were Swedish and other Scandinavian banks. They pounce on the lending opportunities to opened up by an entire nation whose real estate had almost no tax on it. The result was the biggest real estate bubble in the world, along with Russia’s. Latvians found that in order to buy housing of their own, they had to go deeply into debt. Assets were only given to insiders, not to the people.

A few years ago there was a reform movement in Latvia to stop the economic bleeding. Jeff and I brought over American property appraisers and economists. We visited the leading bank, regulatory agencies. Latvia was going broke because its population had to pay so much for real estate. And it was under foreign-exchange pressure because debt service on its mortgage loans was being paid to the Swedish and foreign banks. The bank regulator told us that her problem was that her agency’s clients are the banks, not the population. So the regulators thought of themselves as working for the banks, even though they were foreign-owned. She acknowledged that the banks were lending much more money than property actually was worth. But her regulatory agency had a solution: It was to have not only the buyer be obligated to pay the mortgage, but also the parents, uncles or aunts. Get the whole family involved, so that if the first signer couldn’t pay the cosigners would be obligated.

That is how Latvia stabilized its banking system. But it did so by destabilizing the economy. The result is that Latvia has lost 20 percent of its population over the past decade or so. For much the same reasons that Greece has lost 20 percent of its population, with Ireland in a similar condition. The Latvians have a joke “Will the last person who leaves in 2020 please turn off the lights at the airport.”

The population is shrinking because the economy is being run by looters, domestic and foreign. I was shown an island in the middle of the Daugava river that runs to the middle of Latvia, and was sold for half a million dollars. Our appraisers said that it’s worth half a billion dollars, potentially. There are no plans to raise the property tax to recapture these gains for the country – so that it can lower its heaviest labor taxes in the world, nearly half each paycheck for income tax and “social security” spending so that finance and real estate won’t be taxed.

A few years ago, I was at the only meeting of INET (George Soros’s group) that I was invited to, and in the morning one of the lead talks was on how Latvia was a model that all countries could follow to balance the budget. Latvia has balanced the budget by cutting back public spending, reducing employment and lowering wage levels while indebting its population and forcing to immigrate. The neoliberal strategy is to balance by selling off whatever remains in the public domain. Soros funded a foundation there (like similar ones he started in other post-Soviet countries) to get a part of the loot.

These giveaways at insider prices have created a kleptocracy obviously loyal to neoliberal economics. I go into the details in my chapter. It’s hard to talk about it without losing my temper, so I’m trying to be reasonable but it’s a country that was destroyed and smashed. That was the U.S. neoliberal model alternative to post-Stalinism. It wasn’t a new American economy. It was a travesty.

Why then does the population continue to vote for these neoliberals? The answer is, the neoliberals say, the alternative is Stalinism. To Latvians, this means exile, deportations and memories of the old pro-Russian policy. The Russian-speaking parties are the main people backers of a social democracy party. But neoliberals have merged with Latvian nationalists. They are not only making the election over resentment against the Russian-speaking population, but the fact that many are Jewish.

I find it amazing to see someone who is Jewish, like George Soros, allying with anti-Semitic and even neo-Nazi movements in Latvia, Estonia, and most recently, of course, Ukraine. It’s an irony that you could not have anticipated deductively. If you had written this plot in a futuristic novel twenty years ago, no one would have believed that politics could turn more on national and linguistic identity politics than economic self-interest. The issue is whether you are Latvian or are Russian-Jewish, not whether you want to untax yourself and make? Voting is along ethnic lines, not whether Latvians really want to be forced to emigrate to find work instead of making Latvia what it could have been: an successful economy free of debt. Everybody could have gotten their homes free instead of giving real estate only to the kleptocrats. The government could have taxed the land’s rental value rather than letting real estate valuation be pledged to pay banks – and foreign banks at that. It could have been a low-cost economy with high living standards, but neoliberals turned in into a smash and grab exercise. They now call it an idea for other nations to follow. Hence, the U.S.-Soros strategy re Ukraine.

ED: That’s an excellent point. It’s a more extreme case for a number of reasons in Ukraine – the same tendency. They talk about, “Putin and his gaggle of Jews.” That’s the idea, that Putin and the Jews will come in and steal everything – while neoliberals plan to appropriate Ukraine’s land and other resources themselves. In this intersection between economics and politics, Latvia, Lithuania, Estonia – the Baltic States of the former Soviet Union – are really the front lines of NATO expansion. They were some of the first and most pivotal countries brought into the NATO orbit. It is the threat of “Russian aggression” via the enclave at Kaliningrad, or just Russia in general. That is the threat they use to justify the NATO umbrella, and simultaneously to justify continuing these economic policies. So in many ways Russia serves as this convenient villain on a political, military and economic level.

MH: It’s amazing how the popular press doesn’t report what’s going on. Primakov, who died a few months ago, said during the last crisis a few years ago that Russia has no need to invade Latvia, because it owns the oil export terminals and other key points. Russia has learned to play the Western game of taking countries over financially and acquiring ownership. Russia doesn’t need to invade to control Latvia any more than America needs to invade to control Saudi Arabia or the Near East. If it controls exports or access to markets, what motive would it have to invade? As things stand, Russia uses Latvia it as a money laundering center.

The same logic applies to Ukraine today. The idea is that Russia is expansionary in a world where no one can afford to be militarily expansionary. After Russia’s disaster in Afghanistan, no country in the world that’s subject to democratic checks, whether it’s America after the Vietnam War or Russia or Europe, no democratic country can invade another country. All they can do is drop bombs. This can’t capture a country. For that you need major troop commitments.

In the trips that I’ve taken to Russia and China, they’re in a purely defensive mode. They’re wondering why America is forcing all this. Why is it destroying the Near East, creating a refugee problem and then telling Europe to clean up the mess it’s created? The question is why Europe is willing to keep doing this. Why is Europe part of NATO fighting in the Near East? When America tells Europe, “Let’s you and Russia fight over Ukraine,” that puts Europe in the first line of fire. Why would it have an interest in taking this risk, instead of trying to build a mutual economic relationship with Russia as seemed to be developing in the 19th century?

ED: That’s the ultimate strategy that the United States has used – driving a wedge between Russia and Europe. This is the argument that Putin and the Russians have made for a long time. You can see tangible examples of that sort of a relationship even right now if you look at the Nord Stream pipeline connecting Russian energy to German industrial output – that is a tangible example of the economic relationship, that is only just beginning between Russia and Europe. That’s really what I think the United States wanted to put the brakes on, in order to be able to maintain hegemony. The number one way it does that is through NATO.

MH: It’s not only put the brakes on, it has created a new iron curtain. Two years ago, Greece was supposed to privatize 5 billion euros of its public domain. Half of this, 2.5 billion, was to be the sale of its gas pipeline. But the largest bidder was Gazprom, and America said, “No, you can’t accept the highest bidder if its Russian.” Same thing in Ukraine. It has just been smashed economically, and the U.S. says, “No Ukrainian or Russian can buy into the Ukrainian assets to be sold off. Only George Soros and his fellow Americans can buy into this.” This shows that the neoliberalism of free markets, of “let’s everybody pay the highest price,” is only patter talk. If the winner in the rigged market is not the United States, it sends in ISIS or Al Qaeda and the assassination teams, or backs the neo-Nazis as in Ukraine.

So, we’re in a New Cold War. Its first victims, apart from Southern Europe, will be the rest of Europe. You can imagine how this is just beginning to tear European politics apart, with Germany’s Die Linke and similar parties making a resurgence.

The Troika and IMF doctrine of austerity and privatization

ED: I want to return us back to the book and some other key issues that you bring up that I think are most important. One that we hear in the news all the time, and you write extensively about it in the book, is the Troika. That’s the IMF, the European Central Bank (ECB) and the European Commission. It could be characterized as the political arm of finance capital in Europe, one that imposes and manages austerity in the interest of the ruling class of finance capital, as I guess we could call them. These are technocrats, not academically trained economists primarily (maybe with a few exceptions), but I want you to talk a bit about how the Troika functions and why it’s so important in what we could call this crisis stage of neoliberal finance capitalism.

MH: Basically, the Troika is run by Frankfurt bankers as foreclosure and collection agents. If you read recently what former Greek finance minister Yanis Varoufakis has written, and his advisor James Galbraith, they said that when Syriza was elected in January, they tried to reason with the IMF. But it said that it could only do what the European Central Bank said, and that it would approve whatever they decided to do. The European Central Bank said that its role wasn’t to negotiate democracy. Its negotiators were not economists. They were lawyers. “All we can say is, here’s what you have to pay, here’s how to do it. We’re not here to talk about whether this is going to bankrupt Greece. We’re just interested in in how you’re going to pay the banks what they’re owe. Your electric companies and other industry will have to go to German companies, the other infrastructure to other investors – but not from Russia.”

It’s much like England and France divided up the Near East after World War I. There’s a kind of a gentlemen’s agreement as to how the creditor economies will divide up Greece, carving it up much like neighboring Yugoslavia to the north.

In 2001 the IMF made a big loan to Argentina (I have a chapter on Argentina too), and it went bad after a year. So the IMF passed a rule, called the No More Argentinas rule, stating that the Fund was not going to participate in a loan where the government obviously can not pay.

A decade later came the Greek crisis of 2011. The staff found that Greece could not possibly pay a loan large enough to bail out the French, German and other creditors. So there has to be a debt write-down of the principal. The staff said that, and the IMF’s board members agreed. But its Managing Director, Strauss-Kahn wanted to run for the presidency of France, and most of the Greek bonds were held by French banks. French President Sarkozy said “Well you can’t win political office in France if you stiff the French banks.” And German Chancellor Merkel said that Greece had to pay the German banks. Then, to top matters, President Obama came over to the G-20 meetings and they said that the American banks had made such big default insurance contracts and casino gambles betting that Greece would pay, that if it didn’t, if the Europeans and IMF did not bail out Greece, then the American banks might go under. The implicit threat was that the U.S. would make sure that Europe’s financial system would be torn to pieces.

ED: And Michael, I just want to clarify, I guess it’s sort of a question: about what you’re talking about here in terms of Geithner and Obama coming in: These would be credit default swaps and collateralized debt obligations?

MH: Yes. U.S. officials said that Wall Street had made so many gambles that if the French and German banks were not paid, they would turn to their Wall Street insurers. The Wall Street casino would go under, bringing Europe’s banking system down with it. This prompted the European Central Bank to say that it didn’t want the IMF to be a part of the Troika unless it agreed to take a subordinate role and to support the ECB bailout. It didn’t matter whether Greece later could pay or not. In that case, creditors would smash and grab. This lead the some of the IMF European staff to resign, most notably Susan Schadler, and later to act as whistle blowers to write up what happened.

The same thing happened again earlier this year in Greece. Lagarde said that the IMF doesn’t do debt reduction, but would give them a little longer to pay. Not a penny, not a euro will be written down, but the debt will be stretched out and perhaps the interest rate will be lowered – as long as Greece permits foreigners to grab its infrastructure, land and natural resources.

The staff once again leaked a report to the Financial Times (and maybe also the Wall Street Journal) that said that Greece couldn’t pay, there’s no way it can later sell off the IMF loan to private bondholders, so any bailout would be against the IMF’s own rules. Lagarde was embarrassed, and tried to save face by saying that Germany has to agree to stretch out the payments on the debt – as if that somehow would enable it to pay, while its assets pass into foreign hands, which will remit their profits back home and subject Greece to even steeper deflation.

Then, a few weeks ago, you have the Ukraine crisis and the IMF is not allowed to make loans to countries that cannot pay. But now the whole purpose is to make loans to countries who can’t pay, so that creditors can turn around and demand that they pay by selling off their public domain – and implicitly, force their population to emigrate.

ED: Also, technically they’re not supposed to be making loans to countries that are at war, and they’re ignoring that rule as well.

MH: That’s the second violation of IMF rules. At least in the earlier Greek bailout, Strauss Kahn got around the “No More Argentinas” rule by having a new IMF policy that if a country is systemically important, the IMF can lend it the money even if it can’t pay, even though it’s not credit-worthy, if its default would cause a problem in the global financial system (meaning a loss by Wall Street or other bankers). But Ukraine is not systemically important. It’s part of the Russian system, not the western system. Most of its trade is with Russia.

As you just pointed out, when Lagarde made the IMF’s last Ukrainian loan, she said that she hoped its economy would stabilize instead of fighting more war in its eastern export region. The next day, President Poroshenko said that now that it had got the loan, it could go to war against the Donbass, the Russian speaking region. Some $1.5 billion of the IMF loan was given to banks run by Kolomoisky, one of the kleptocrats who fields his own army. His banks send the IMF’s gift abroad to his own foreign banks, using his domestic Ukrainian money to pay his own army, allied with Ukrainian nationalists flying the old Nazi SS insignia fighting against the Russian speakers. So in effect, the IMF is serving as an am of the U.S. military and State Department, just as the World Bank has long been.

ED: I want to interject two points here for listeners who haven’t followed it as closely. Number one is the private army that you’re talking about – the Right Sector which is essentially a mercenary force of Nazis in the employ of Kolomoisky. They’re also part of what’s now called the Ukrainian National Guard. This paramilitary organization that is being paid directly by Kolomoisky. Number two – and this relates back to something that you were saying earlier, Michael – that IMF loan went to pay for a lot of the military equipment that Kiev has now used to obliterate the economic and industrial infrastructure of Donbass, which was Ukraine’s industrial heartland. So from the western perspective it’s killing two birds with one stone. If they can’t strip the assets and capitalize on them, at least they can destroy them, because the number one customer was Russia.

MH: Russia had made much of its military hardware in Ukraine, including its liftoff engines for satellites. The West doesn’t want that to continue. What it wants for its own investors is Ukraine’s land, the gas rights in the Black Sea, electric and other public utilities, because these are the major tollbooths to extract economic rent from the economy. Basically, US/NATO strategists want to make sure, by destroying Ukraine’s eastern export industry, that Ukraine will be chronically bankrupt and will have to settle its balance-of-payments deficit by selling off its private domain to American, German and other foreign buyers.

ED: Yes, that’s Monsanto, and that’s Hunter Biden on the Burisma board (the gas company). It’s like you said earlier, you wouldn’t even believe it if someone would have made it up. It’s so transparent, what they’re doing in Ukraine.

Financialization of pension plans and retirement savings

I want to switch gears a bit in the short time we have remaining, because I have two more things I want to talk about. Referring back to this parasitical relationship on the real economy, one aspect that’s rarely mentioned is the way in which many regular working people get swindled. One example that comes to my mind is the mutual funds and other money managers that control what pension funds and lots of retirees invest in. Much of their savings are tied up in heavily leveraged junk bonds and in places like Greece, but also recently in Puerto Rico which is going through a very similar scenario right now. So in many ways, US taxpayers and pensioners are funding the looting and exploitation of these countries and they’re then financially invested in continuing the destruction of these countries. It’s almost like these pensioners are human shields for Wall Street.

MH: This actually is the main theme of my book – financialization. Mutual funds are not pension funds. They’re different. But half a century ago a new term was coined: pension fund capitalism, sometimes called pension fund socialism. Then we got back to Orwellian doublethink when Pinochet came to power behind the natural alliance of the Chicago School with Kissinger at the State Department. They immediately organized what they called labor capitalism. n labor capitalism labor is the victim, not the beneficiary. The first thing they did was compulsory setting aside of wages in the form of ostensible pension funds controlled by the employers. The employers could do whatever they wanted with it. Ultimately they invested their corporate pension funds in their own stocks or turned them over to the banks, around which their grupo conglomerates were organized. They then simply drove the businesses with employee pension funds under, wiping out the pension fund liabilities – after moving the assets into their captive banks. Businesses were left as empty corporate shells.

Something similar happened in America a few years ago with theChicago Tribune. Real estate developer Sam Zell borrowed money, bought the Tribune, using the Employee Stock Ownership Plan (ESOP) essentially to pay off the bondholders. He then drove/looted the Tribune into bankruptcy and wiped out the stockholders. Employees brought a fraudulent conveyance suit.

Already fifty years ago, critics noted that about half of the ESOPs are wiped out, because they’re invested by the employers, often in their own stock. Managers give themselves stock options, which are given value by employee purchases. Something similar occurs with pension funds in general. Employee wages are paid into pension funds, which bid up the stock prices in general. On an economy-wide basis, employees are buying the stock that managers give themselves. That’s pension fund capitalism.

The underlying problem with this kind of financialization of pensions and retirement savings is that modern American industry is being run basically for financial purposes, not for industrial purposes. The major industrial firms have been financialized. For many years General Motors made most of its profits from its financial arm, General Motors Acceptance Corporation. Likewise General Electric. When I was going to school 50 years ago, Macy’s made most of its money not by selling products, but by getting customers to use its credit cards. In effect, it used its store to get people to use its credit cards.

Last year, 92% of the earnings of the Fortune 100 companies were used for stock buy-backs — corporations buying back their stock to support its price – or for dividend payouts, also to increase the stock’s price (and thus management bonuses and stock options). The purpose of running a company in today’s financialized world is to increase the price of the stock, not to expand the business. And who do they sell the stock to? Essentially, pension funds.

There’s a lot of money coming in. I don’t know if you remember, but George W. Bush wanted to privatize Social Security. The idea was to spend all of its contributions – the 15+% that FICA withholds from workers paychecks every month – into the stock market. This would fuel a giant stock market boom. Money management companies, the big banks, would get an enormous flow of commissions, and speculators would get rich off the inflow. It would make billionaires into hundred-billionaires. All this would soar like the South Sea Bubble, until the American population began to age – or, more likely, begin to be unemployed. At that point the funds would begin to sell the stocks to pay retirees. This would withdraw money from the stock market. Prices would crash as speculators and insiders sold out, wiping out the savings that workers had put into the scheme.

The basic idea is that when Wall Street plays finance, the casino wins. When employees and pension funds play the financial game, they lose and the casino wins.

ED: Right, and just as an example for listeners – to make what Michael was just talking about it even more real – if we think back to 2009 and the collapse of General Motors, it was not General Motors automotive manufacturing that was collapsing. It was GMAC, their finance arm, which was leveraged on credit default swaps, collateralized debt obligations and similar financial derivatives – what they call exotic instruments. So when Obama comes in and claimed that he “saved General Motors,” it wasn’t really that. He came in for the Wall Street arm of General Motors.

Obama’s demagogic role as Wall Street shill for the Rubinomics gang

MH: That’s correct. He was the Wall Street candidate, promoted by Robert Rubin, who was Clinton’s Treasury Secretary. Basically, American economic policies can run by a combination of Goldman Sachs and Citigroup, often interchangeably.

ED: This was demonstrated very clearly in the first days of Obama taking office. Who does he meet with to talk about the financial crisis? He invites the CEOs of Goldman Sachs and JP Morgan, Bank of America, Citi and all of the rest of them. They’re the ones who come to the White House. It’s been written about in books, in the New Yorker and elsewhere. Obama basically says, “Don’t worry guys, I got this.”

MH: Ron Suskind wrote this. He said that Obama said, “I’m the only guy standing between you and the pitchforks. Listen to me: I can basically fool them.” (I give the actual quote in my book.) The interesting thing is that the signs of this meeting were all erased from the White House website, but Suskind has it in his book. Obama emerges as one of the great demagogues of the century. He may be even worse than Andrew Jackson.

ED: So much of it is based on obvious policies and his actions. The moment he came to power was a critical moment when action was needed. Not only did he not take the right action, he did exactly what Wall Street wanted. In many ways we can look back to 2008 when he was championing the TARP, the bailout, and all the rest of that. None of that would have been possible without Obama. That’s something that Democrats like to avoid in their conversations.

MH: That’s exactly the point. It was Orwellian rhetoric. He ran as the candidate of Hope and Change, but his real role was to smash hope and prevent change. By keeping the debts in place instead of writing them down as he had promised, he oversaw the wrecking of the American economy.

He had done something similar in Chicago, when he worked as a community organizer for the big real estate interests to tear up the poorer neighborhoods where the lower income Blacks lived. His role was to gentrify them and jack up property prices to move in higher-income Blacks. This made billions for the Pritzker family. So Penny Pritzker introduced him to Robert Rubin. Obama evidently promised to let Rubin appoint his cabinet, so they appointed the vicious anti-labor Rahm Emanuel, now Chicago’s mayor, as his Chief of Staff to drive any Democrat to the left of Herbert Hoover out of the party. Obama essentially pushed the Democrats to the right, as the Republicans gave him plenty of room to move rightward and still be the “lesser evil.”

So now you have people like Donald Trump saying that he’s for what Dennis Kucinich was for: a single payer healthcare program. Obama fought against this, and backed the lobbyists of the pharmaceutical and health insurance sectors. His genius is being able to make most voters believe that he’s on their side when he’s actually defending the Wall Street special interests that were his major campaign contributors.

ED: That’s true. You can see that in literally every arena in which Obama has taken action. From championing so-called Obamacare, which is really a boon for the insurance industry, to the charter schools to privatize public education and also become a major boon for Wall Street, for Pearson and all these major education corporations. In terms of real estate, in the gentrification, all the rest. Literally every perspective, every angle from which you look at Obama, he is a servant of finance capital of investors, not of the people. And that’s what the Democratic Party has become, delivering its constituency to Wall Street.

A left-wing economic alternative

MH: So here’s the problem: How do we get the left to realize this? How do we get it to talk about economics instead of ethnic identity and sexual identity and culture alone? How do we get the left to do what they were talking about a century ago – economic reform and how to take the side of labor, consumers and debtors? How do we tell the Blacks that it’s more important to get a well paying job? That’s the way to gain power. I think Deng said: “Black cat, white cat, it doesn’t matter as long as it catches mice.” How do we say “Black president, white president, it doesn’t matter, as long as they give jobs for us and help our community economically?”

ED: I think that’s important and I want to close with this issue: solutions. One of the things I appreciate in reading your book is that it is broken up into sections. The final section, I think, is really important. You titled it: “There Is An Alternative.” That is of course a reference to Margaret Thatcher’s TINA (There Is No Alternative). That ideology and mindset took over the left, or at least the nominally left-wing parties. So you’re saying that there is an alternative. In that section you propose a number of important reforms. You argue that they would restore industrial prosperity. Now, I’m not asking you to name all of them, to run down the list, but maybe touch on a little bit of what you included, and why that’s important for beginning to build this alternative.

MH: There are two main aims that classical economists had 200 years ago. One was to free society from debt. You didn’t want people to have to spend their lives working off the debt, whether for a home, for living or to get an education. Second, you wanted to fund industry, not by debt but by equity. That is what the Saint-Simonians and France did. It’s what German banking was famous for before World War I. There was a debate in the English speaking countries, especially in England saying that maybe England and the Allies might lose World War I because the banks are running everything, and finance should be subordinated to fund industry. It can be used to help the economy grow, not be parasitic.

But instead, our tax laws make debt service tax deductible. If a company pays $2 billion a year in dividends, a corporate raider can buy it on credit and, if there’s a 50% stock rate, he can pay $4 billion to bondholders instead of $2 billion to stockholders. Over the past twenty years the American stock market has become a vehicle for corporate raiding, replacing equity with debt. That makes break-even costs much higher.

The other point I’m making concerns economic rent. The guiding idea of an economic and tax system should be to lower the cost of living and doing business. I show what the average American wage earner has to pay. Under the most recent federal housing authority laws, the government guarantees mortgage loans that absorb up to 43% of family income. Suppose you pay this 43% of income for your home mortgage, after the 15% of your wages set aside for Social Security under FICA.

Instead of funding Social Security out of the general budget and hence out of what is still progressive taxation, Congress has said that the rich shouldn’t pay for Social Security; only blue-collar workers should pay. So if you make over $115,000, you don’t have to pay anything. In addition to that 15% wage tax, about 20% ends up being paid for other taxes – sales taxes, income taxes, and various other taxes that fall on consumers. And perhaps another 10% goes for bank loans besides mortgages – credit card loans, student loans and other debts.

That leaves only about 25% of what American families earn to be spent on goods and services – unless they borrow to maintain their living standards. This means that if you would give wage earners all of their food, all their transportation, all their clothing for nothing, they still could not compete with foreign economies, because so much of the budget has to go for finance, insurance and real estate (FIRE). That’s why our employment is not going to recover. That’s why our living standards are not going to recover.

Even if wages do go up for some workers, they’re going to have to pay it to the bank for education loans, mortgage loans (or rent), bank debt and credit card debt, and now also for our amazingly expensive and rent-extracting medical insurance and health care and medications. The result is that if they try to join the middle class by getting higher education and buying a home, they will spend the rest of their lives paying the banks. They don’t end up keeping their higher wages. They pay them to the banks.

ED: You don’t have to tell me. I’m living that reality. Interestingly, in that final section of your book you talk about alternatives, like a public banking option that many people have discussed. You talk about the Social Security cap that you were just mentioning, and focus on taxing economic rent. Some critics would suggest that these sorts of reforms are not going to be able to salvage the capitalist model that is so ensconced in the United States. So I want to give you a chance to sort of present that argument or maybe rebut it.

MH: I won’t rebut that criticism, because it’s right. Marx thought that it was the task of industrial capitalism to free economies from the economic legacies of feudalism. He saw that the bourgeois parties wanted to get rid of the “excrescences” of the industrial capitalist marketplace. They wanted to get rid of the parasites, the landowners and usurious creditors. Marx said that even if you get rid of the parasites, even if you socialize finance and land that he dealt with in volume II and III of Capital, you’re still going to have the Volume I problem. You’re still going to have the exploitation problem between employers and employees – the labor/capital problem.

My point is that most academic Marxists and the left in general have focused so much on the fight of workers and labor unions against employers that they tend to overlook that there’s this huge FIRE sector – Finance, Insurance, and Real Estate – tsunami is swamping the economy. Finance is wrecking industry and government, along with labor. The reforms that Marx expected the bourgeois parties to enact against rentiers haven’t occurred. Marx was overly optimistic about the role of industrial capitalism and industrialized banking to prepare the ground for socialism.

This means that until you complete the task of freeing of society from feudalism – corrosive banking and economic rent as unearned income – you can’t solve the industrial problems that Marx dealt with in Volume I. And of course even when you do solve them, these problems of labor exploitation and markets will still exist.

ED: Yes, absolutely. Well we’re out of time. I want to thank you for coming onto the program. Listeners, you heard it. There’s so much information to digest here. The book is really brilliant, I think essential reading, required reading – Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy, available through CounterPunch, as well as on Amazon. Michael Hudson professor of economics at University of Missouri Kansas City, his work is all over the place. Find it regularly on CounterPunch, as well as on his website Michael Hudson thanks so much for coming on CounterPunch Radio.

MH: It’s great to be here. It’s been a wonderful discussion.

ED: Thank you.


Michael Hudson’s new book, Killing the Host is published in e-format by CounterPunch Books and in print by Islet. He can be reached via his website,




See featured article here:

TLB recommends that you read other pertinent articles at:




By TLB Contributor: PAUL FASSA

“The next time you visit a hospital, it is your wallet that may end up hurting the most.  All over the United States, it has become common practice for hospitals to wildly inflate medical bills.  For example, it has been reported that some hospitals are charging up to 30 dollars for a single aspirin pill.” – Michael Snyder, The Economic Collapse Blog

That enormous $153,161.25 hospital bill is easily on par with purchasing a house – except the house would typically be financed over 30 years. Notice the hospital bill was dated or issued on July 13, 2015 and the entire bill is due July 27, 2015. I think even loan sharks and illegal drug dealers would allow a little more time for a payback before ordering a hit.

Tell me again, what kind of country bankrupts its citizens when they are struggling to stay alive in a scary medical emergency and at their most vulnerable?

Paul Fassa

Did you notice the pharmacy charge? A cool $83,341.25! Meet America’s most successful Drug dealers.

bigpharma CEOs

Current estimates are that hospitals in the United States overcharge their patients by approximately 10 billion dollars every single year.

According to a 2012 report in Reuters, the Paris-based Organization for Economic Cooperation and Development (OECD), proclaimed that the US is number one or highest in health care spending: “Annual healthcare spending totals $2.6 trillion, equal to 17.9 percent of U.S. annual gross domestic product, or $8,402 for every man, woman and child.”

Yet it’s only 31st in providing coverage to its people among the OECD’s 34 members! America is not the best allopathic health care system in the world. It ranks 27th in life expectancy and 31 out of 40 in infant mortality, compared to other OECD countries. See other dismal US health care rankings here.

Projections are that the U.S. will spend 4.5 trillion dollars on health care in 2019.

This unfortunate person obviously suffered from two snake bites [bill pictured above]. One from an actual snake and the other a financial bite from the snakes wearing white coats and the power behind them, the financial scammers sporting expensive suits, Rolex watches, and a Mercedes or two.

“All the criminals, in their coats and their ties, are free to drink martinis and watch the sun rise.” –Bob Dylan



“It would be difficult to argue that the extreme greed that we see in the medical system is even matched by the crooks on Wall Street.  These medical predators get their hands on us when we are at our most vulnerable.  They know that in our lowest moments we are willing to pay just about anything to get better or to make the pain go away.  And so they very quietly have us sign a bunch of forms without ever telling us how much everything is going to cost.” – Zero Hedge



The $884-billion-a-year, private health insurance industry is another offspring of Wall Street profit at any cost. In fact, the largest health insurance companies are managed by the world’s top investment houses. Huge financial institutions own the majority of health insurance stocks or shares.

“… Their top priority is maximizing returns on investments, not improving health. Using sophisticated technology and the vast financial resources generated by stupendous premium revenue streams, insurance companies have cadres of actuaries and skilled managers to keep them miles ahead of consumers and regulators. Because they are active in every part of the country, the business practices of dominant, national for-profit insurance companies have become the model for the nonprofit insurance companies with which they compete.”


The supposed operating rational behind traditional insurance is pooling of risk.

The game is run the same way for all types of insurance. The idea is that only a few unfortunate souls will need to draw from the collective pool during any given time period. In other words, there’s’ always more money in the pool compared to how much is drawn from it.

But here’s the rub: since everyone, as Shakespeare so cleverly pointed out eventually “suffer[s] the slings and arrows of outrageous fortune” most will eventually need to draw funds from the collective “sick pool fund.”  The reality is that we’re paying a third party to manage our healthcare dollars for us –until we really need them. Meanwhile, the health insurance banksters skim as much profit off the top of the pool any way they can and employ an army of paper-pushing middlemen to manage our contributions.

If you query Americans who do have private health insurance, most will contend that they are satisfied with their coverage – until they actually have to put it to the test.

“Once they face a medical emergency, however, they soon discover that the unspoken policy of many insurers is to deny as many claims as possible, often on legally and medically implausible grounds, until the patient or his family give up. Multiple calls, usually including direct intervention from a physician, may pressure an insurance company into changing their ruling–but the critically-ill often lack the time and emotional energy to wage such battles.”Jacob M. Appel, Bioethicist and medical historian

Here’s the dirty little secret behind how health insurance companies operate. They don’t make money by pooling or spreading the risk; they make money by limiting risk.

The key to keeping their profits high is to sell insurance to those considered ” low risk”  applicants  (young and healthy) and limit their “high risk” applicants (older people or those who have pre-existing health issues). That’s why they hire actuaries.

In the past decade, insurance premiums have increased three times as fast as wages.


Obvious ways insurance companies game the system to boost their profits and fool people into believing that health insurance is their best and only option:

Reject applicants based on their health history and current health status. In other words, the more you need health (sick) care coverage the less likely you are to able to get it. And remember health insurance is actually sick care coverage, nothing else.

Cherry pick applicants. The older you get, the more you’ll pay for the same or usually lesser coverage, because on average, it’s likely that more problematic health conditions have accrued. If you work in a health compromising job you’ll pay more for insurance.

You will pay the highest premiums and co-pays and may be forced to choose a very high deductible because you are considered a greater risk – which means you are likely to use your health insurance more than those who pose a lesser risk according to actuaries.

Translation: Pay more, lots more money for less or inferior sick care coverage when you really need it – when your life may depend on it.

Divide and conquer. View your body parts as separate risk factors and attach riders to your health insurance policy that exclude coverage of conditions or body parts that could require medical attention. Or pay more for a pre-existing condition-waiting period rider.

Isn’t it obvious by now that the house always wins because the game is rigged for that outcome? Lure the young and healthy into the sick care insurance scam with a high-deductible, lower-premium plan that statistically most likely won’t be used often.


Buybacks and Dividends

A legally questionable method resorted to by insurance companies to maximize profits and boost CEO pay is to take customer paid premiums and use them to repurchase company stock. These large-scale buybacks enrich institutional shareholders, top executives, and board members who have extensive company stock holdings.

“From 2003 to 2010, the five biggest insurance companies spent $64.1 billion buying back their own shares and lining the pockets of their senior executives while imposing ever-bigger premium increases on America’s families and businesses. That is expected to grow by billions when the 2011 reports come in.”

“Anyone who has worked as a healthcare provider long enough, and has been paying attention, eventually comes to recognize private health “insurance” is a large-scale criminal endeavor — part Ponzi scheme, part extortion racket — that consistently exploits patients at their most vulnerable moments. In short, private health insurance is the sort of predatory enterprise, like payday lending and loan-sharking, that should be criminalized.” – Jacob M. Appel, Bioethicist and medical historian

So just in case you’re thinking ‘Well, I have health insurance so I’m protected from this type of financial devastation, right?’ Wrong! A 2013 commonwealth fund survey was conducted in 11 countries and found that US adults with year round health coverage were more likely than adults in other countries to skip needed medical care, because it’s unaffordable; it costs too much.

Surprisingly, even the fully insured in the US are forced to struggle with huge medical bills and are often stuck with high out-of-pocket costs.

“The U.S. spends more on health care than any other country, but what we get for these significant resources falls short in terms of access to care, affordability, and quality,” said Commonwealth Fund President David Blumenthal, MD.


Most Americans are very afraid of hospitals not only because they routinely kill so many patients, but because of the severe financial pain they cause.

One short hospital stay can literally drain your savings accounts, max out your credit cards, liquidating assets including refinancing your home to pay off your enormous medical bills. Even with health insurance, you can still accrue a mountain of medical debt.

By the way, did you know hospital medical errors are killing approximately 440,000 people each year? For example, patients get the wrong drugs or the wrong dose; some die from secondary infections because doctors or nurses forgot to wash their hands. Others perish simply because they never get needed tests or life saving treatments.

hospitalbills and meth


The unvarnished truth: Americans are literally drowning in medical debt. In fact, medical bills are the number-one cause of personal bankruptcy and they are responsible for more collections than credit cards.

Approximately 40 percent of Americans have medical bill problems or are paying off medical bills. Each year 30 million Americans are in collection for medical debt. Compared to adults living in other developed countries, Americans are much likelier  to struggle to pay their medical bills or to skip medical care altogether for financial reasons.

Clinical Significance


American EclecticBack in the late 1800’s a group of US physicians called Eclectics  documented the use of Echinacea for successfully treating all kind of stings and bites.

Because allopathic, monopoly medicine has successfully suppressed most natural, inexpensive and non-toxic treatments and cures, I’m positive that most – if not all of you reading this do not know that Echinacea angustifolia root extract is a cure for a variety of stings and bites including black widow spiders and rattlesnakes.

The treatment is twofold both topical and internal. First a moist compress soaked in the extract is placed on the wound, while simultaneously the extract is taken internally. When taken orally the extract enters the bloodstream and targets the areas just under the skin, which halts the spread of venom along with tissue healing.

The Eclectic physicians documented that their patients experienced improvement in 30 minutes to several hours after treatment with Echinacea.  Full resolution was reported within 24 hours. No unpleasant side effects were ever experienced.

Bottom Line: Hospitals, Big Pharma, Insurance Companies, and Most Doctors are Blatantly Ripping Off Americans as They Monopolize Medical Care!


Paul Fassa is a contributing staff writer for and The Liberty Beacon project. His pet peeves are the Medical Mafia’s control over health and the food industry and government regulatory agencies’ corruption. Paul’s valiant contributions to the health movement and global paradigm shift are well known. Visit his blog by following this link and follow him on Twitter here.




TLB recommends you visit REAL farmacy for more pertinent articles and information.

See featured article HERE

great-depression---jobs(Desperate Americans stand in soup kitchen lines and look for work. Circa 1929)

The Shocking Reality: This Chart Shows Just How Bad Unemployment Is Today Compared to The Great Depression

By: Mac Slavo

While the Obama administration and their mainstream surrogates maintain that the economy is growing at a booming pace, the reality of the situation is starkly different.

According to a report from the Bureau of Labor Statistics some 94.6 million Americans (age 16 and over) are either not working or have made no effort to find a job. With a population of 320 million, that means nearly one in three people in the United States are currently out of work.

The Bureau of Labor Statistics reports that a record 94,610,000 people (ages 16 and over) were not in the labor force in September. In other words they were neither employed nor had made specific efforts to find work in the prior four weeks.

The number of individuals out of the work force last month — due to discouragement, retirement or otherwise — represented a substantial 579,000 person increase over the most recent record, hit in August, of 94,031,000 people out of the workforce.

Curiously, the official unemployment rate remained unchanged at 5.1%, suggesting that some 95% of people actually have jobs.

But as we’ve repeatedly pointed out, that number has been completely skewed over the last two decades as it fails to account for people who have stopped looking for work (because there are no actual jobs available).

According to John Williams of Shadow Stats, if we were to calculate unemployment using the same metrics as we did during the 1930’s, or even the 1980’s, we’d already be in Great Depression territory. Williams, who utilizes a reporting methodology that accounts for “long-term discouraged workers who were defined out of official existence in 1994,” notes that the real unemployment rate is rapidly approaching 25%.


Now compare the above chart to similar measurements from the 1930’s and you’ll see just how bad things really are:

greatdepression-unemployment(via Casey Research)

It’s so bad, in fact, that we have seen sustained unemployment exceeding that of the Great Depression for almost the entirety of Barack Obama’s Presidency.

But how can it be possible to have a full-fledged recovery and record stock prices when nearly one-third of the adult population is not working?

If the government is to be believed, it’s because our economy continues to grow at a pace of about 2%.

But once again, if we calculate the real growth rate and adjust for inflation, we see exactly why jobs are non-existent and getting worse every month.

The following chart made available by Williams shows that despite a positive “official” GDP growth rate being disseminated to the public, the reality is exactly the opposite. The U.S. economy is by all accounts shrinking and has been doing so for the better part of a decade:


We’ve already witnessed numerous shocks to the global economy over recent weeks and the prospects of any sort of stability just went out the window.

There is no recovery. There are no jobs. There is no growth.

The United States, regardless of what is being said by mainstream financial pundits or believed by their TV-watching myrmidons, is now (and has been for quite some time) in a recession.

What’s worse is that most have no clue of how bad things really are or that they are witnessing America’s Second Great Depression.

We have seen many prognostications of what might happen in the Fall of 2015 and beyond. For now, we have avoided the Doomsday event many have feared.

But as The Prepper’s Blueprint author Tess Pennington notes, this doesn’t mean we should ignore the real possibility of a wide breadth of potential outcomes from economic malaise and geo-political tensions:

So the world didn’t end, but we should face the facts that our world is exponentially changing. In the last ten years, it has changed so dramatically that many of us do not recognize it.

Riots, extreme climate changes, epidemics, unemployment, political upheaval, I could go on, but I think you get the picture. These changes are the events you should prepare for. Preparing for a singular event is impractical and will leave you exposed and with gaps in your preparedness plan. 

That said, if your preps were well-rounded enough, you can insulate yourself from many different forms of disasters: natural, personal, economic, societal, etc. Once you are prepared for a multitude of events, you don’t worry as much. There are always events that are out of our control. The only control we have is to be ready for them the best we can by being prepared, self-reliant, not depending on the system, and changing our perception about disasters.

Source: Another Doomsday Prophecy Come and Gone

The collapse that many have suggested will take place at some point in the future is actually happening right here and now.

If the charts above are accurate – and we believe they are – then America is already in the throes of its next Great Depression.


TLB recommends you visit SHTF plan for more pertinent articles and information.

See featured article here



by AntiCorruption Society


Excerpts from the book, pages 58-60:

Edward Mandell House 2

Edward M. House

Col. Edward Mandell House, who was the agent provocateur of Rothschild, the head of the European Central Banks, was assigned to oversee the President and the Congress in the implementation of the central bankers’ plans. House is attributed with giving direction and strategy to be implemented by the president and the senators to enslave the American people with the passage of the Federal Reserve Act and Amendments 16 and 17.

Support for the legal presumption that the American people had volunteered to participate in the United States democracy was legislated with the 17th Amendment in 1913 in that participation in federal elections for U.S. Senator established the legal presumption necessary in determining that you were a federal citizen.

[The American BAR Association]

The scheme also provided for the control of the courts via the 1913 creation of the American Bar Association [1], whose parent organization was the European International Bar Association, which was the creation of Rothschild. This allowed the International Bankers to control the practice of law, in that the only ones permitted to practice before the courts were those who were educated under their brand of law, which was only Admiralty and Contract law. Common law of the people was to be replaced as it gave the natural man many jurisdictional protections from the bankers’ legislation.

When the Congress made its first attempt to throw out the common law and replace it with Admiralty law, the Supreme Court rejected the proposed rules of court, explaining that the proposed rules would bring into existence a national police state. So, Roosevelt stacked the high Court and waited for a case upon which the demise of the common law could be accomplished. Erie v. Tompkins came along in 1938 [2] and gave the court the opportunity that the Constitution did not. Thereafter, Common law at the federal level was to be no more.

The 1920s were an eat, drink and be merry time, with the majority of the population living the good life with no care in the world and no attention to what was happening in Congress. The stock market crashed, and those not on the inside were not warned to take their money out of the market and, as a result, lost everything. This set the stage for socialism and Roosevelt’s New Deal. It was a new deal, all right – a one-sided deal, as you are about to learn.

[The Birth of the STRAWMAN]

Contract law is above the Constitution and under the jurisdiction of Equity/Admiralty courts, so the governments began to contract with everyone. The 1930s saw federal legislation providing for the registration of babies through applications for birth certificates. Government workers could get maternity leave with pay. The States pushed for registration of cars through applications for certificates of title and for registration of land through registration of deeds of trust. Constructive trusts were created secretly by adhesion contracts, giving benefits either present or future and as a result, each of the people blindly walked into the trap of United States democracy and its jurisdiction by the signing of contracts, thereby agreeing to be sureties for the debts of the United States and collateral for the Federal Reserve Bank, Inc. [3]

The Great Depression supplied the diversion needed to keep the people’s attention away from what the government was doing. The Social Security program was implemented, along with numerous other socialistic “New Deal” programs that invited the American people to volunteer to be the sureties behind the United States’ new registered property and adhesion contracts through the legal presumption that they were 14th Amendment United States subjects. [4] We are permitted to contract with anyone, even the government, so for the promise of benefits from the federal government, we traded away our unalienable rights and put on a mask of the subject [juristic] person.

Massive registration of property through United States agencies, including the States of the Union as instrumentalities of the federal government in bankruptcy, assured the United States and its officers and instrumentalities (the states) that they would become wealthy beyond their wildest expectations, as predicted by Colonel House.

Edward Mandell House had this to say in a private meeting with Woodrow Wilson (President, 1913-1921) From the private papers of Woodrow Wilson:
“[Very] soon, every American will be required to register their biological property in a National system designed to keep track of the people and that will operate under the ancient system of pledging. By such methodology, we can compel people to submit to our agenda, which will affect our security as a charge back for our fiat paper currency. Every American will be forced to register or suffer not being able to work and earn a living. They will be our Chattel and we will hold the security interest over them forever, by operation of the law merchant under the scheme of secured transactions. Americans, by unknowingly or unwittingly delivering the bills of lading [5] to us will be rendered bankrupt and insolvent, forever to remain economic slaves through taxation, secured by their pledges. They will be stripped of their rights and given a commercial value designed to make us a profit and they will be none the wiser, for not one man in a million could ever figure our plans and, if by accident one or two would figure it out, we have in our arsenal plausible deniability. After all, this is the only logical way to fund government, by floating liens and debt to the registrants in the form of benefits and privileges. This will inevitably reap to us huge profits beyond our wildest expectations and leave every American a contributor to this fraud which we will call “Social Insurance.” [6] Without realizing it, every American will insure us for any loss we may incur and in this manner every American will unknowingly be our servant, however begrudgingly. The people will become helpless and without any hope for their redemption and, we will employ the high office of the President of our dummy corporation [7] to foment this plot against America.”

All of this was done without disclosure of the material facts that accompanied each application for contract registration. That fraud would have been sufficient reason to charge all the United States officers and elected officials with treason, unless a legal remedy could be legislated for the people to recoup their property and collect for the damages they suffered as a result of the fraud if ever discovered.

[Hidden ‘Legal Remedy’]

If a legal remedy was available, and the people chose not to or failed to secure their remedy, no charge of fraud could be brought, even to a common law court. The United States Congress needed only to provide the legal remedy. It was not required to explain it or even tell the people where the remedy could be found; if they did that then the entire conspiracy would be revealed and every cherry tree in Washington would be decorated with hanging bodies of Congressmen and bankers. The attorneys did not even have to be taught about the remedy in law school. Remaining quiet, Congress had plausible deniability if the people discovered the deception. The majority of the legislators did not have to have the intricate details of the law explained to them regarding the bills they were passing; the pressure was on by the leadership to pass this legislation, and that was all they needed to know. If the people failed to exercise due diligence, the United States became the holder in trust of all the land and labor of every subject in the American Empire. If, however, the people did discover their legal remedy, the United States would have to honor it and release the registered property back to the people, but only if the people were cognizant that they had a remedy, and only if they exercised it in the proper technical manner. It was a great plan, and it has worked for over 70 years.

Having established plausible deniability, even if the people became enlightened that they had a remedy and pursued it, the attorneys, judges, and legislators could claim that they did not understand the people’s claims, especially if the technical requirements for achieving it were not followed pursuant to the statutory requirements. Requiring the public schools to teach civics, government, and history classes out of federally-approved politically correct textbooks written by the publishing houses owned by the owners of the Federal Reserve would assure that the people would not discover the remedy for a long time, if ever.

NOTE: Fruit from a Poisonous Tree is available at Amazon and Barnes and Noble. Here is a link to Chapter Two – Magicians (31 pages) that contains these excerpts.

[1] See: The Legal Craft (The BAR Card)

[2] See Who’s Running America; Barefoot’s

[3] “The U.S. citizen (tenant, franchisee) was registered as a ‘beneficiary’ of the trust via his/her birth certificate. In 1933, the federal United States hypothecated all of the present and future properties, assets and labor of their ‘subjects,’ the 14th  Amendment U.S. citizen, to the Federal Reserve System.”  See: Congressional Record, March 17, 1993

[4] See: The Great American Adventure by Judge Dale, retired

[5] The “bills of lading” refer to the documents presented to the harbor master when goods are delivered – i.e. the “Certificate of Live Birth” signed by the Mother after she delivers her baby, as demanded by the hospital or mid-wife.

[6] Social Security

[7] See: United States Corporation

Of Importance

In August 1999, President Bill Clinton signed Executive Order 13132, Federalism, which states in Section 2 (d): The people of the States are free, subject only to restrictions in the Constitution itself or in constitutionally authorized Acts of Congress, to define the moral, political, and legal character of their lives.

This Executive Order pointed to the American people’s remedies. If they refuse to vote in the “Federal Elections”, declare their legal character as a flesh and blood living man or woman (versus a “juristic person”), and sign all documents “without prejudice UCC 1-308” restricting their assent; then they can challenge statutory (Admiralty) rules/statutes being falsely portrayed as laws. Suggestions for doing this can be found in LAWFULLY YOURS – The People’s Empowerment Guide to our Corporate-commercial Legal System.


Treason – A Notice to Public Servants

Is your dead legal-fiction STRAWMAN still enslaving you?

Federalism, “personage” and freedom


Read featured article here

TLB recommends you visit AntiCorruption Society for more great/pertinent articles.



By Tom Lawson

Private companies have been working to make a profit from water since the 1600s, when the first water companies were established in England and Wales. The first wave of water privatization occurred in the 1800s, and by the mid- to late-19th century, privately owned water utilities were common in Europe, the United States and Latin America, and began to appear in Africa and Asia.

But the privatization flurry faded, and throughout much of the 20th century water was largely a publicly controlled resource. In the U.S., for example, just 30% of piped water systems were privately owned in 1924, dropping from 60% in 1850.

It wasn’t until the late 1980s that the idea of private companies managing water re-emerged on a large scale. Under Margaret Thatcher, the U.K. government privatized all water companies in England and Wales in 1989 – making it the first country to do so. Coupled with the global emphasis on free market capitalism after the fall of communism, it began the second wave of water privatization that continues today.

Privatizing water was, and still is, encouraged by the International Monetary Fund and the World Bank, which make public-to-private takeovers a condition of lending. As a result, the early 1990s saw a rush of cities and countries around the world signing over their nations’ water resources to private companies.

It is argued by industry and investors that putting water in private hands translates into improvements in efficiency and service quality, and that services will be better managed. Privatizing also provides governments an opportunity to gain revenue by selling off water services, and for companies to generate profit. But with profit the main objective, the idea of water as a human right arguably becomes a secondary concern.

Problems with water privatization often begin to occur soon after the initial wave of enthusiasm – from lack of infrastructure investment to environmental neglect. A 2005 study by the World Bank said that overall evidence suggests “there is no statistically significant difference between the efficiency performance of public and private operators in this sector.” The most common complaint about water privatization concerned tariff increases, which occur in the vast majority of cases, making safe water inaccessible for many.

Despite these issues, aid agencies, water companies and many governments around the world continue to pursue privatization of water in the name of profit. In 2011, economist Willem Buiter described water as “an asset class that will, in my view, become eventually the single most important physical-commodity-based asset class, dwarfing oil, copper, agricultural commodities and precious metals.”

But opposition to this ideology is mounting. Known as remunicipalisation, more and more communities and governments are choosing to resist and reverse private water contracts. According to a 2014 report by the Transnational Institute, around 180 cities in 35 countries have returned control of their water supply to municipalities in the past 15 years.

To highlight this trend, here are some of the most significant examples of resistance to water privatization:





Cochambamba, Bolivia, 2000


In 1999, the control of water in Cochabamba, Bolivia’s third largest city, was handed over to Aguas del Tunari – a new company and joint venture involving the U.S. engineering company Bechtel Corporation. The deal was orchestrated by the World Bank and the Inter-American Development Bank, which made it a requirement for Bolivia to retain ongoing state loans. Privatization did little in addressing access to water for the city’s residents – but led to a tripling in water’s cost, and is thought to have contributed to an increase in levels of poverty.

As a result, the people of Cochabamba protested on a mass scale. Tens of thousands took to the streets, and in April 2000, the government reversed the privatization and the city’s water was back under state control. Know as the Cochabamba Water War, the case marked a turning point in the anti-water privatization movement. It demonstrated that private contracts could be overcome by grassroots action, and it paved the way for others to follow suit.




Atlanta, Georgia (U.S.), 2003


Although problems of water privatization are often seen as an issue in the developing world, Western nations are increasingly experiencing remunicipalisation as well. One of the first cities for this to occur in the early 2000s was Atlanta. When United Water took over the city’s water supply in 1999, it promised 50% savings for the public and double-digit growth for the company. But as soon as the company took over, the workforce was cut in half and water quality declined to such an extent that on some occasions residents were forced to boil their tap water. Meanwhile, tariffs increased year over year.

As a result of public anger, and just four years into a 20-year contract, Atlanta Mayor Shirley Franklin reversed the privatization in 2003. Although more than 20 cities in the U.S. have taken back control of water from private companies since 2002, that process is under threat after President Obama signed the Water Resources Reform and Development Act into law last year, which seeks to expand private financing for water projects.




Uruguay, 2004


In 2004, Uruguay became the first country to make water privatization illegal by prohibiting the sale and operation of water services to private companies. A referendum was held after two private projects in the country proved unpopular. There was also growing pressure from the IMF for new private contracts tied to loan conditions, and threats arising from free trade investment negotiations with organizations like the World Trade Organization and Free Trade Area of the Americas.

The proposal to make water privatization in Uruguay illegal was supported by more than 62% of voters. It stated that access to piped water and sanitation are fundamental human rights, and that social impact takes priority over economic considerations in water policy. A similar law came into force in the Netherlands that same year. In a 2011 referendum, 27 million Italians voted to repeal a law favoring water privatization in order for their water services to remain public.



France, 2005 – Present


Despite being one of the first countries to involve private companies in water management, and being home to giant global water companies Veolia and Suez, remunicipalisation is surging in France. Since 2005 there have been 41 cases of water being put back into state hands, with more reversals expected in the next few years. After a contract with Suez and Veolia expired in 2010, Paris citizens voted to return their water to public control. Since then, the city’s water supply has been managed by Eau de Paris using a plan of “water solidarity,” which includes discounts for poor households and enables citizens to engage in decisions about water investment and tariffs. In the first year under Eau de Paris, the city saved $46 million and managed to reduce rates for residents.






Ireland, 2014 – Present


Until recently, Ireland was the only Organisation for Economic Co-operation and Development (OECD) country with water free at the point of use. But in 2014, the government decided to establish a semi-state company, Irish Water, as part of a 2010 bailout deal reached with the European Union and IMF. With the formation of the company came the introduction of water usage chargers, despite the fact that citizens already pay for water through general taxation. As a result, the move became the most unpopular of all the austerity measures introduced in Ireland since 2008.

In May, the country’s environment minister announced an estimated average household cost of €240 ($272) due to the privatization, and said that water would turn to “a trickle” for those who refused to pay. But people resisted and Irish Water collected less than half the charges due for the first quarter of 2015. Citizens loudly protested the threat of water privatization through song and by taking to the streets in the hundreds of thousands nationwide. In August, a poll revealed that the majority of political parties in Ireland are now in favor of holding a referendum on whether water services should be privatized. With a general election due to take place by April 2016, the people of Ireland could become the latest to reject water privatization, spurring other countries to do the same.




Lagos, Nigeria, 2015


The Nigerian capital, Lagos, hosted a first-of-its-kind water summit in August. The two-day event brought together civil society groups and activists from around the world to look at specific ways of preventing water privatization internationally, and putting forward options for alternatives as companies increasingly put profit before public interest. Lagos was chosen to host the event due to an impending private takeover of the city’s water supply, which is facing ongoing opposition from local people. The summit resulted in the formation of the Africa Coalition Against Water Privatisation, which is working to galvanize a network of civil society and development experts promoting access to water as a human rights issue.








By TLB Contributor: Ken LaRive

In a world of cat and mouse, a world of dog eat dog, of illusion, lies, and selfish endeavors without accountability, people who try to find the truth of the matter are humiliated and labeled. As some attempt to blink way the sleep from their eyes, blinded by lethargic years and bogus truths, they start to study and connect dots. This process is a sobering experience, as they are labeled un-American, Conspiracy theorists, truthers, traitors, and far worse, potential terrorists, and some, about three percent of the population, find themselves in survival mode. In my opinion, this survival mode of thought will be our only salvation… If you trust the system, go with the flow, do what you are told, you will be eaten alive.

In the process of living, we all try to trust the powers that control us from cradle to grave. We live our lives in quiet desperation, like good subjects do, and all of us to the very last man with a certificate of live birth, are slaves to a system that changes color when observed… so as not to be understood and caught.Today I will mention two amazing phenomena that have many Americans by the throat. One is called the “Gold scam,” and the other is called the bond market. Many investment groups have warned of these two prospects, if and when our economy defaults, and most emphatically agree, at least in my research, that those who are investing in these two markets will surely lose in a big way.

Let’s talk about the Goldscam first…

If our currency fails, if the Petro Dollar is no longer a viable legal tender accepted in world markets, if the U.S. defaults on World Bank loans, those who own gold and silver might have more of a fighting chance in the coming ciaos. The problem here is that you will have to actually possess these precious metals… You will have to hold them in your hands.

If all you have is a certificate of trust, and our economy fails, what you think belongs to you safe and sound in a depository will be a bitter wake up call. According to the U.S. Geological Survey records, every 400 ounces of gold traded in what is called “futures’ contracts”, on COMEX, The American commodities exchange, only one ounce actually exists for every 400 ounces traded. Any paper claim would hold no weight in a time of crisis, and that is the character of this system called the commodity market. It all runs smoothly until a bubble pops, and there are many about to pop.

Believe it or not but student debt, 1 trillion, is in the top three, with our amazing debt slavery being roughly 155K owed by every US citizen… But when you pencil in federal, local, corporate and consumer debt, that number is a staggering $729,000.00 per U.S. family as of 2014. From that calculation done just six months ago, we have added another trillion… to an unbelievable 18.8 trillion in debt. To put this in perspective, just four months before Obama’s election in 2008, we were at six trillion. Four months prior to the election, we added 4 trillion to our national debt, by banks and a Federal Reserve who are above the law and unaccountable to any higher law…. And so, since 2008, we have added 8.8 trillion more, printed out of thin air…

The last nail in our coffin will come from corporate accumulation of junk Bonds…

This bubble will usher in the largest destruction of individual wealth in the history of humanity, and few know or care to protect themselves. Most are too caught up in their lives to realize that this staggering tsunami of a bubble is tremendous in scope and ramification, and will dwarf the housing bubble that started in 2007 by a factor of three. Some will flourish, and others will be reduced to a cave man mindset.

A Junk bond is a high-yield bond issued by companies’ manipulating the market. Looking at history, junk bonds yielded less than 5% annually, but these same bonds are now over 6%. Credit is being given to less than investment-grade firms, the same as the housing bubble of 2007, but far greater. The Federal Reserve drives this market by keeping interest rates near zero, and buying billions of what some call toxic assets, Treasury securities and mortgage-backed debt, and this is driving a bogus bull market on bonds. And what does America get as this transpires? Debt slavery, yes, but this bubble will not just pop, it will explode, and the whole world will hear the thunder as we are dismantled by what can only be described as world bank carpetbaggers. We would disintegrate as a nation on many levels, and with our very insipid dog eat dog mindset, the unprepared will attempt to take what they need by force, when the lights go out.

I am reading two books simultaneously now, Porter Stansberry’s America 2020, and the New Rand Paul book, “Taking a Stand.” I see hope there, and a viable game plan for the survival of a few. To save America would take a miracle, I’m so sorry to say, as the powers causing this cannot stop themselves. The will take, and take, until there is nothing viable left. Protect yourself, and your family. They care nothing about you but their own black bottom line. The backbone of America is our viable middle class, and this is dying right before our eyes.

We do not need a bully or tyrant to save us. What we need is our Constitution and Bill of Rights, and a Government that gets out of the way of free enterprise.-Ken LaRive

See more articles by Ken HERE

See featured article here

tyranny ahead

By TLB Contributor: Dave Hodges

It is easy to interpret the signals of our economy from afar when we see people driving cars everywhere and we tend to think that our economy is not that bad.

The fact remains that 40 years ago Americans owned those cars that we see them driving. Today, we are renting them as 40% of us are leasing our vehicles.

As we drive up and down our neighborhoods, we see people living in houses and we lie to ourselves as use this as a  false barometer to convince ourselves that everything is OK. However, many of these homes we see people living in, have lost all of their equity.

The logical answer to the question “When will we have a depression?”, should be answered by stating “We have an $19 trillion dollar annual deficit and that is the good news. We have $240 trillion dollars of debt from unfunded liabilities and we have a stunning $1.5 quadrillion dollar debt.

So, you better grab all the food, water, guns and ammunition that you can and run for the hills, if you are able”!  But as long we see people driving in cars and living in houses, most Americans are gong to deny the truth.

Yet, I feel compelled to speak the truth because I might be able to get one more person to take the steps necessary to help increase the odds of their survival in response to what is coming. History shows that one can count on six things occurring following the collapse of the dollar.

The Last Great American Garage Sale

On multiple occasions in this column, I have thoroughly documented the following facts which demonstrate that the banksters are stealing our assets in preparation for them to economically survive what is coming:

1. The Seventh Circuit Court of Appeals ruled that when you put money into the bank, you have transferred ownership of that money to the bank. This ruling represents government sponsored theft in the highest order, yet most of us are unaware that this happened.

2. The G20 nations declared the money in your bank account to not be money. Therefore, the FDIC insurance for your savings.

3. The MERS mortgage fraud is ongoing and homeowners are still having their homes stolen without legal justification.

4. The Federal Reserve, in 2012, began to print money to the tune of $40 billion dollars a month in order to purchase mortgage backed securities.

5. The banksters have practiced stealing the secured accounts of American in the MF Global (MFG) scandal, resulting in the loss of $6.3 billion dollars of secured investment funds. Nobody went to jail.

6. In April of 2013,  the banksters are manipulating the price of gold as evidenced by the actions of “Goldman Sachs who told their clients earlier that they recommend initiating a short COMEX gold position.” After investors were duped into panic selling, the banksters bought up massive sums of gold. The banksters were buying gold while getting out the American Stock Market and the megabanks. Why? Because the dollar is on the verge of collapse. This manipulation is continuing today. Gold and silver are being kept artificially low. NOW, is the time to buy!

7. The banksters have signaled that they were no longer attempting to gain control of any more gold as they began to repatriate gold with their rightful owners in Europe. This means that the crash could happen at any time.

The only thing left to do is for the banksters to steal your bank accounts. The correct “crisis” will bring about the collapse of the dollar now that the wealth transfer has largely been accomplished.

What America Will Look Like Following the Collapse of the Dollar-Five Things You Can Count On Happening

The aftermath of an economic collapse can take different forms, however, history demonstrates that there are some universal things you can count on:

1. Obamavilles

hooverville 2

hooverville 1

People will lose their jobs and ultimately will be evicted from their homes and America will see a dramatic spike in the rate of homelessness.

During the Great Depression (1929-1941),the growing number of homeless people in America began to live in communities with cardboard boxes as their only shelter. The communities took on the name “Hooverilles” in reference to the President that most Americans blamed for the Great Depression.

Today, as the economy collapses, a new homeless class will be created and they will come from the former middle class. A large number of Americans own property. This will shift to a large amount of properties will subsequently be owned by the few and America will witness the introduction of feudalism to our country. This is why the Federal reserve has been buying $40 billion dollars of mortgage backed securities every month.

Did you know that the New York City homeless shelters are filled with people that have full-time jobs? It has already started.

2. Dramatic Food Shortages


Because of “Just In Time” deliveries, the American food industry operates on quick and multiple deliveries and survives only as the result of the rapid payment of invoices. As the failing economy reaches to service industry, most of these business will fail in very large numbers. Who then, will be delivering the food? Only a fool is not storing food and water.

3. Food Riots

food riots 1

food riots 2

Because of the food shortages, riots and organized gang violence will occur. The military is trained to isolate these areas, but will not intervene. If you call 911, nobody will be answering. This will be the time that you wished you had listened to many in the alternative media because this is the time that America will begin to see a large loss of life.

4. Persecution of Christians

The persecutions of Christians is already taking place as record numbers of Christians are leaving the military because of overt discrimination. In the American military, Christians are being disciplined for sharing their faith. No other religion has such a prohibition.

When Pastor Walter Mansfield, one of the original Clergy Response Team member, told me in an interview that he would be forbidden to mention the words “Jesus” and the “Bible” while ministering in the camps.

 Germany is evicting Christians from their homes to make way for Muslim invaders. For example, the UK Telegraph is reporting that  51-year-old German Christian woman, one of many, is being evicted from her home of 16 years to make way for refugees, with shelters already full across the country. On September 1, 2015, she received a letter from her landlord and the local municipality, telling her the building was being turned into a refugee shelter and she had until May to leave. So much for the Syrian exodus being a spontaneous event. It was well planned. Many feel that Christians are being targeted in Germany for home evictions in favor of refugee shelters for Muslims in Germany. With the Refugee/Resettlement program in full swing in the United States, how long will it be until the same thing begins to happen here?

5. Martial Law Will Be Declared

(Editor’s note: War will comprise a 6th element that will accompany the coming events. Because of the enormity of the subject, this development will be covered separately).

DHS and the military has already practiced for this development. Travel will be limited and it will stopped all together in areas where the civil unrest is at its worst.
The  2012 and 2014 National Defense Authorization Act (NDAA), will allow government officials to “disappear” anyone they want to and for any reason, or no reason at all.  The NDAA suspends habeas corpus, provides for indefinite detention and this is done on the premise that certain kinds of Americans are threats (e.g. Second Amendment supporters, Bible-believing Christians). This is where the present harassment of Christians will turn into the outright persecution of Christians.

I think the public has a right to know how its government plans to handle future protests. Is America the new Venezuela, Egypt, or Ukraine?  A previously secret document which was leaked online; entitled FM 3-39.40 Internment and Resettlement Operations (PDF).


H-42. Quick-reaction force teams should be established with a minimum response time. Because of the physical nature of riot control, individuals in riot control formations should not carry rifles. Nonlethal attachments should follow closely behind the riot control formation. Lethal coverage must be provided for this entire formation. (See FM 3-22.40.)


H-43. During a nonlethal engagement, the use of designated marksmen provides confidence and safety to those facing a riot. If a lethal threat is presented, the designated marksmen in overwatch positions (armed with appropriate sniper weapons mounted with high-powered scopes) can scan a crowd and identify agitators and riot leaders for apprehension and fire lethal rounds if warranted. Additionally, they are ideally suited for flank security and countersniper operations. (See FM 3-22.40.).

Travel restrictions will be a part of this process. Travel restrictions will be a part of this process.

Government Control Over All Fuel and Transportation

These are some of the things that government can do to you courtesy of several executive orders.

Executive Order 10990

Allows the government to take control over all modes of transportation, highways, and seaports.

Executive Order 11003

Allows the government to take over all airports and aircraft, including commercial aircraft.

Executive Order 11005

Allows the government to take over railroads, inland waterways, and public storage facilities.

Executive Order 10997

Allows the government to take over all electrical power, gas, petroleum, fuels, and minerals.

Government Control Over All Food and Water

Executive Order 10998

Allows the government to take over all food resources and farms

The Ability to Enslave the American People

Executive Order 11000

Allows the government to mobilize civilians into work brigades under government supervision.

Executive Order 11001

Allows the government to take over all health, education, and welfare functions.

Executive Order 11002

Designates the Postmaster General to operate national registration of all persons.

Executive Order 11004

Allows the Housing and Finance Authority to relocate communities, build new housing with public funds, designate areas to be abandoned, and establish new locations for populations.

Ability to Grant the President Total Dictatorial Control

Executive Order 11051

Specifies the responsibility of the Office of Emergency Planning and gives authorization to put all Executive Orders into effect in times of increased international tensions and economic or financial crisis.

Executive Order 11310

Grants authority to the Department of Justice to enforce the plans set out in Executive Orders, to institute industrial support, to establish judicial and legislative liaison, to control all aliens, to operate penal and correctional institutions, and to advise and assist the President.

Executive Order 11049

Assigns emergency preparedness function to federal departments and agencies, consolidating 21 operative Executive Orders issued over a fifteen year period.

There are more examples, but I think you get the idea. Your government has practiced to subjugate and even murder you in times such as these.


Is there anything that can be done to stop the egregious violations of our civil liberties? The short answer is no! However, there are some things that can be done to mitigate the threat and to soften the landing following an economic collapse. These will be covered, in detail, in a future article.


TLB recommends you visit Dave at The Common Sense Show for more pertinent articles and information.

See featured article HERE

financial collapse 2

These Are the Final Chest Pains of a Dead Global Economy

 By TLB Contributor: Dave Hodges

The world’s stock markets are in free fall and the banks and their worthless paper currencies are next!!!

The world is in the middle of a global economic meltdown. What does that mean? The simple answer is that it will not be long until every modern country is consumed by hyperinflation resulting in the crash of most of the paper currencies on the planet …

This will result in an economic shutdown. Starvation will become commonplace. Unrestrained violence will occur and eventually the world will slip into World War III.

I literally have at my finger tips two dozen economic indicators which demonstrates that total and global economic collapse is at hand. In the interest of brevity, I will only highlight two of these indicators and if these were the only indicators, an economic collapse would still be in our collective futures.

A Dead Global Economy

Not too long ago Reuters reported that shipping freight rates for transporting containers being transported from the ports in Asia to Northern Europe dropped almost 23% to $400 per 20-foot container in the week ended on August 3, 2015 and the data was obtained from the Shanghai Containerized Freight Index. At that time, at least the crippled Baltic Dry Index was holding its own. That is not longer the case. The BDI is in total free fall. Oil prices are in free fall. Very little is moving. The Chinese Stock Market is disintegrating before our eyes. Read this chart and weep. This is the end. There will be no more warnings, only progress reports about the collapse. According to the BDI product is NOT moving!


According to this chart, very soon, nothing will be moving. This means catastrophic food shortages. Medicines will not be shipped. Those who still have jobs will not be able to drive to work. This is why China devalued its currency. And in retaliation, this is China was attacked, twice, this past week. The point of no return has been reached.

To those that are not economically not savvy to the importance to the BDI, I have prepared a brief explanation below.

The Baltic Dry Index

bdiThe  Baltic Dry Index (BDI) is absolutely the best measure of  global economic health. The BDI is used by economists as a leading global economic indicator because it predicts future economic activity. The BDI, uses the U.S. dollar as a benchmark and measures the global supply and the corresponding demand for commodity shipments among bulk carriers. Commodities, in the form of raw materials like grains, lumber, coal and precious metals form the backbone of the BDI. Over time, the BDI is the best indicator of global economic health because, unlike the futures market, the BDI does not engage in speculation as it provide near real time data on what and what is being shipped. The determinations made by the BDI are such an accurate indicator of economic activity because businesses don’t book freighters when they have no cargo to move. In short, the BDI is the world’s financial blood pressure measure. The BDI is said to be one day away from reaching its all-time low. Ultimately, what the BDI tells economists is that we are headed for a depression that will make 1929 look like a picnic.

Back in February of 2015, the BDI had fallen on 43 of the past 47 days because of a shipping strike. Back in February, the world was days away from a total economic shutdown. However, the crisis was resolved and product began to move and the world bought a few more moments of relative peace.

If Product Does Not Get Shipped, You Do Not Eat!

Let’s look at this issue through the lens of common sense. If raw materials are not being transported in sufficient numbers as the BDI strongly indicates, what will happen  to manufacturing?

To the cognitive dissonance crowd, please take off your rose colored sunglasses and honestly answer this question, what does a low BDI mean to manufacturing? Low BDI means low manufacturing, period! In turn this means less finished products coming to market. Please note that the BDI includes grains in its analysis. With fewer grains being shipped to market to be packaged and distributed to your grocery outlet, this will lead to severe food shortages. This is not fear-mongering, this is simple Economics 101. Look at the chart representing the collapse of the BDI and ask yourself, where will your Thanksgiving turkey come from?

When the full effect of this impending train wreck is felt, there will not be a government in the civilized world that will be safe from assassination. I know, some of you will say that this will never happen. Well, let’s take a look at what Paul Craig Roberts and Sam Ro said back in February about the conditions in Greece.

European Union Economic Crisis

Two days ago, the Euro declined 1.3% in one day versus the dollar, leaving many European banks fearing that the bottom is falling out of the European Union’s economy. Business Insider’s Sam Ro stated  that Greek banks can no longer exchange Greece’s lowly-rated government bonds for money in the European Union. In other words, the European Union just announced the Greece’s money is worthless. What keeps an economy, in distress, rolling on day after day? The reasons are purely psychological. One Greek accepts Greek bank notes from another Greek because they have confidence that the paper currency can be exchanged for goods and services. When Greek citizens loses confidence in their ability to flip the paper money in exchange for goods and service, the Greek economy will totally collapse. The European Union’s recent decision to not honor Greek paper currency has set into effect a series of dominoes which will culminate in the Greeks not having a paper currency for daily use. Unless the European Union reverses their position, the Greek economy could be days away from total collapse. And under these highly volatile circumstances, anarchy would ensue.

The situation in Greece is so dire that Paul Craig Roberts is openly talking about the real possibility that the Greek government will be assassinated. Roberts believes that it is very possible that the Greek people will turn their back on the West and will accept Russia’s offer to become a member of the BRICS, under the Russian sphere of influence as Roberts indicated.

That makes it difficult to make an agreement with the new Greek government to ameliorate the conditions imposed on Greece.  So it makes the EU inflexible.  That inflexibility gives Greece the cards to say, ‘We’re not playing your game — we’re going to play a different game and accept Russia’s offer.”

To make matters worse global oil prices are plummeting as well in this double whammy which will result in nothing being shipped.

oil plunging

Eurozone collapse is inevitable.

Eurozone collapse is inevitable.

Spain and Ireland’s economy are on the verge of collapse and have been since the summer of 2015. Germany, France and Italy would be better off to be in the Russian sphere of influence given their dependence on Russian gas shipments to these three economies. In short, the European Union will not survive. If the EU is still here in Thanksgiving, I am going to be very surprised.

Although the date of the death of the European Union has yet to be determined. However, it is only a matter of time. And if Paul Craig Roberts assertion that when the Greek government will be assassinated in the coming anarchy, how long will it be until the violence crosses into Spain, Ireland, Italy and then consumes the rest of Europe? And do you expect Putin to idly stand by and not take advantage of the chaos? Stalin would have been salivating at this coming opportunity.

The incompatibility of Muslim immigration has already brought violence to the streets of Sweden, France and several other European countries will exacerbate the economic conditions. Europe is primed and ready for a total meltdown and with the health of the American economy, there is no way that we can save financial backsides of our training partners.  At the end of the day, I think Paul Craig Roberts prediction may be tame. The Greek government will not be the only government running for cover when the proverbial economic poop hits the fan, the violence will spread across Europe like Ebola across West Africa.


Do you think the September date associated with the Pope addressing the United Nations is a coincidence? I recommending that all of us plan accordingly. Does this make Jade Helm’s purpose a little more clear?


Four Hundred of the world’s richest people lost a total of $182 billion this week, amounting to 6.3% of their total and collective wealth. These people are the last line of economic defense, it is over! And what do rich people do when the money begins to run out? ANSWER: THEY START WARS!!!

The Commodities market is at a 13 year low! The only thing that is increasing in value is gold!

These numbers make 2008 look like an economic boom!!!

Are you prepared for what is coming? Have you stored food, water and made agreements of protection with your neighbors. Are you and your family spiritually prepared? It is 30 seconds to midnight, we are out of time.

In summary, I will reiterate what I have said many times before:

This bankster run system does not work for you and me. Buy gold and silver!!!!! Again, take your money out of their banks, stop shopping in globalist stores like Walmart and begin to trade and barter and grow your own food. To do otherwise, is to continue to participate in a rigged game which will culminate in your destruction!


TLB recommends you visit Dave at The Common Sense Show for more pertinent articles and information.

See featured article HERE


Introduction by Mary Carmel (TLB)

President Obama is on a hiring spree once again, abusing the H-1B foreign workers visa, and Americans are losing out to jobs, fighting for work against his illegal aliens. Not only are Americans being laid off , they are being asked to train their foreign replacements, in the case of HP, and Disneyland, etc.!!! Please see the article below and attached links pertaining to this issue. Links to contact Congress and Representatives are listed. Please share!!! MC



Hewlett Packard announced this week that the company plans to cut about 10% of its workforce, roughly around 30,000 American workers, while expanding the use of H-1B foreign worker visas. HP Chairman and CEO Meg Whitman said, “We’ve done a significant amount of work over the past few years to take costs out and simplify processes and these final actions will eliminate the need for any future corporate restructuring.”

This new set of layoffs comes as an addition to the 54,000 jobs HP has already cut, mostly affecting American workers. Yet, HP continues to hire foreign workers through the H-1B visa program. According to the website: “Hewlett-Packard filed 2,668 labor condition applications for H1-B visa and 815 labor certifications for green card from fiscal year 2011 to 2014. Hewlett-Packard Company was ranked 30 among all visa sponsors.”

The Obama administration has expanded the H-1B visa program by granting work-permits to the spouses of these foreign workers. There are around 650,000 H-1B workers currently residing in the United States.

Presidential candidate and former HP CEO, Carly Fiorina, warned that the H1-B visa program was different from what was available 10 years ago, when she was in charge of the tech company, and that it is now being abused by corporate organizations to displace American workers. In June she commented, “It’s become an issue where it appears that some companies that are abusing that program and asking American workers to train H1-B visa replacements so they can lower wages.”

When asked today about this new round of job lay-offs she responded, “Meg Whitman is there, she has a strategy that she is pursing.” She also commented on how hard it is as a chief executive to tell someone they no longer have a job and that it is a hard time in the technology industry right now.

Read More at Breitbart.


Editor’s note (TLB) See also:

America’s Mixed Feelings About Immigrant Labor: Disney-Layoffs Edition







 See featured article here:

TLB recommends that you  read other pertinent articles at:


Dylan Charles


Editor, Waking Times

The world is enslaved to an economic system designed to create tremendous power and wealth for those who own the system, while forcing the rest of us into mathematically insurmountable debt and the stagnation, austerity and poverty that comes with it.

Corrupt and patently unsustainable, the world’s currencies and financial markets are rigged, and an economic collapse is inevitable at some point. Sad but true, and the ongoing dramatic narrative of the interplay between engineered boom and engineered bust is a chief psychological tool in sustaining the popular belief that this monetary reality as the only monetary reality possible. The truth, however, is that as long as this economic reality is the reality then we will be slaves to debt economics, and the pursuit of endless growth is certain to consume everything on the planet.

The good news is that the task of migrating an entire civilization from one economic system to another is so enormous that as individuals we don’t have to feel encumbered by the pressure of having to come up with the one and only solution to save all of human civilization. We can instead be empowered by the knowledge that any meaningful adjustment we make in our personal lives is a contribution to the future realization of a greater shift for the better, sometime in the future. Our role is merely to be the trim tabs, and when enough momentum builds, watch the ship change its course.

“Something hit me very hard once, thinking about what one little man could do. Think of the Queen Mary — the whole ship goes by and then comes the rudder. And there’s a tiny thing at the edge of the rudder called a trimtab.

It’s a miniature rudder. Just moving the little trim tab builds a low pressure that pulls the rudder around. Takes almost no effort at all. So I said that the little individual can be a trimtab.

Society thinks it’s going right by you, that it’s left you altogether. But if you’re doing dynamic things mentally, the fact is that you can just put your foot out like that and the whole big ship of state is going to go.

So I said, call me Trimtab.” – R. Buckminster Fuller

Someday the combined good efforts of millions and millions of people will pay off and the human race will buck the financial criminals that suck so much or our resources and spirit. Until that day comes, though, we may as well enjoy being creative and active in envisioning an alternative future. To that end, here are 3 critical things you can do to wage personal financial revolution against the banksters and 1%’ers.

1. Get Out of Personal Debt – You CAN do it!

Personal debt has ballooned to mind-bendingly absurd levels. The average ‘consumer’ now owes a combined $205k in credit cards, student loans and mortgages, for a national total of nearly $12 trillion in consumer debt. This is both a physical and metaphysical prison that restricts freedom and feeds psychological duress, coloring the rest of life withundue stress.

Using credit and accruing debt is a matter of personal choice, of course, albeit choices can at times be limited by circumstance. Credit companies do deliberately entrap people in many clever ways and the student loan industry is clearly predatory, but no matter who you choose to point the finger at, and no matter how this has come to be, consumer debt is highly profitable to banks, and highly restrictive to individuals.

Revolt against this madness by getting yourself out of debt. It’s one of the most important things you can do for your quality of life and personal freedom, while revolting against the financial powers that be.

Easier said than done, to be sure, but this message is not intended to be a ‘how-to.’ A ‘how-to’ is of no use without fist mustering the will power and resolve to face a challenge as massive as overcoming personal debt. The message is here is more important than a ‘how-to,’ because it aims at inspiring you to try, and at reminding you that any obstacle can be overcome with will-power, commitment, spirit and a plan.

In a time of universal debt, being debt-free is a revolutionary act.

Joker Dollar Bill


2. Deprogram Consumerism

For the past half century or so we’ve been socially programmed to accept consumerism as the new cultural paradigm, thus changing the way that people interact and relate to one another, and even to themselves. Now, the individual is easily lost in the angry seas of corporate marketing, propaganda, promotions, gimmicks and sponsors. This is a place where the ego can have a field day, but also a place where detachment from reality is itself a preferred new form of reality.

We are constantly being primed to compare, compete with, criticize, judge and out-do each other. As a pissing ground to prove ourselves to one another, we are offered a rather astonishing spread of consumer products, lifestyle options and services. Choices in the marketplace become critical to the fabrication of self-identity.

Insecurity is the psychological pump of the economy that keeps the debt machine moving. In the present paradigm, money is positioned as the chief force which can alleviate insecurity, and if money can do that, then even debt servitude is a small price to pay to for the feel of security. It is of course a lie.

Overcoming and the insecurity and fear that fuel consumerism is largely a personal task and is a natural part of conscious evolution.

3. Detach and Have Fun  With Alternatives

Any effort that you can make to withdraw your consent and tacit support of the current system is another chink in the armor of the Gods of Money, and opportunities to undermine these crooks are abundant. Pay cash whenever you can, buy a used car, toss your credit cards, re-use stuff, try living without money, abandon big banks, divest from the Ponzi scheme stock markets. Use payment intermediaries like Pay Pal to bypass banks, invest in physical assets like precious metals or land, and develop independent streams of income for yourself.

Have you ever tried bartering to acquire something you really wanted? Do you have a Bitcoin purse or know much about Ubuntu and the giving economy? Have you checked if anyone in your area has already started an independent currency, or have you thought about time-banking as a means of getting your roof or some other big project completed without even using cash?

Anything is possible, and if energy is withdrawn from supporting the status quo and re-directed to the imagination and practice of creating something better, then over time alternatives will emerge that will bring us closer to an equitable economy. Human beings are graced with abundant creativity and ingenuity, and if we detach from the current system, even in little ways, we weaken its grip on our reality.

In Conclusion

Financial freedom doesn’t mean you must have more money than you can spend, it simply means that you have the freedom to choose for whom you work and to determine how your money is spent. There will be no direct or easy route to the liberation of the human race from the debt-driven economic system that presently enslaves us, so we’d better get busy experimenting with possibilities.

Being born a human being on this abundant planet should not be an automatic life sentence of involuntary servitude to banks for unreasonable debts fraudulently incurred by others.

Read more articles from Dylan Charles.

About the Author

Dylan Charles is a student and teacher of Shaolin Kung Fu, Tai Chi and Qi Gong, a practitioner of Yoga and Taoist arts, and an activist and idealist passionately engaged in the struggle for a more sustainable and just world for future generations. He is the editor of, the proprietor of, a grateful father and a man who seeks to enlighten others with the power of inspiring information and action. He may be contacted at




See featured article here:


TLB recommends that you visit for other pertinent articles.

  • Subscribe to Blog via Email

    Enter your email address to subscribe to this blog and receive notifications of new posts by email.

    Join 912 other subscribers