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Posts Tagged ‘Political corruption’

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The political games of the billionaires and their political representatives are afoot and quite noticeable, if one cares to look. Did anybody notice over the last several months that Republican Senate Majority leader Mitch McConnell made it abundantly clear that he was not going to consider a stimulus package of more than $500 billion while House Democratic leader Nancy Pelosi was looking at a minimum of $2.2 trillion.

President Donald Trump tried to negotiate something in the middle since he had to placate both. Now that Trump is soon to be out of office, McConnell and Pelosi are looking at a $900 billion package. They put Trump in a hard squeeze for months, and both made certain he was not going to get a new stimulus deal that might help him win reelection. McConnell and Pelosi proved they are different sides of the same coin; they’re corporatists and globalists and controlled by billionaires. They put their desire for political power ahead of the welfare of millions of American citizens who are unemployed because of Covid-19. The terms of the March 2020 CARES Act are due to expire the day after Christmas. People will be evicted from their homes by the millions, while millions will lose their unemployment insurance, and all Pelosi and McConnell cared about for the last several months was increasing their political capital at the expense of everybody but the billionaires who control both of them.

Meanwhile, the U.S. Census Bureau reports that “More and more Americans are going hungry as the pandemic continues to spiral out of control and government aid dries up, with children bearing the brunt of the hardship.

More than 27.3 million or 12.7% of Americans — 17.5% among households with children — reported they either sometimes or often did not have enough to eat in the last week, according to new data this week from the U.S. Census Bureau that polled people from November 25 to December 7. That’s the highest level dating back to the last week of April when the Census survey began.”

Even before Covid-19 struck, according to a 2017 CareerBuilder survey, “78 percent of U.S. workers live paycheck to paycheck to make ends meet (up from 75 percent a year earlier), and nearly one in ten workers making $100,000+ live paycheck to paycheck. More than half of minimum wage workers say they have to work more than one job to make ends meet, while nearly three in four workers say they are in debt today. “A quarter of workers (25 percent) have not been able to make ends meet every month in the last year, and 20 percent have missed payment on some smaller bills. Further, 71 percent of all workers say they’re in debt — up from 68 percent” in 2016. “While 46 percent say their debt is manageable, more than half of those in debt (56 percent) say they feel they will always be in debt. It should be noted that 18 percent of all workers have reduced their 401k contribution and/or personal savings in the last year, more than a third (38 percent) do not participate in a 401k plan, IRA or comparable retirement plan, and 26 percent have not set aside any savings in the last year.” 81 percent of workers “have worked a minimum wage job, and 71 percent of them were not able to make ends meet financially during that time — more than half (54 percent) had to work more than one job.” According to a study by the United States Federal Reserve Bank, 61 percent of adults could pay for an unexpected expense of $400 with cash, savings, or a credit card they could pay off the following month. 27 percent would need to borrow or sell something to pay the expense, and 12 percent could never cover it. This was all before Covid-19.

If you think things were bad for the middle class in 2019, it surely has got to be worse for them nowadays. Below are some other statistics that place things in perspective, and all of these were calculated before Covid-19.

As of 2020, the average working citizen in the USA no longer could afford to raise a family on his or her yearly salary, demonstrating how badly off the middle class has become since 1980. In 1985, a middle class male had to work thirty weeks in order to pay the $13,227 it cost for housing, healthcare, transportation and education. By 2018, the average cost of those four items had risen to $54,441, and it took a male head-of-household fifty-three weeks to pay for them. This stark reality was even worse for female heads of households. Women had to work forty-five weeks to pay for the same things in 1985, but it required sixty-six weeks to earn them in 2018. By 2018, both male and female head-of-households had to work more than a year to pay for a year’s worth of those four items.

There are many reasons why millions of middle class people are in such dire straits; trade agreements, for example, have exported middle class jobs by the millions. Pelosi and McConnell supported every one of these boondoggles. This is why they are different sides of the same coin. Meanwhile, the fifty richest billionaires are worth as much as the poorest 165 million Americans. Both Pelosi and McConnell have worked hand-in-hand to ensure this outcome.

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The electoral college is allowed to exist because the Republicans and the Democrats are indispensable enemies, at least for the billionaires who control both parties. If not for the electoral college, the last Republican United States president would have been George H.W. Bush from 1988 to 1992. The balance of power in Washington D.C. would have been in the hands of the Democrats for most of the time since. Those politicians serve many of the same billionaires who control the Republican Party. The billionaires and their corporate media divide the Republican and Democratic Party grassroots by social issues so as to take our eyes off the prize.

Nowadays, many of the grassroots of both parties are like European soccer fans. They root for their teams regardless of the economic issues that impact them, they engage in fistfights, protests and counter protests, and issue damning insults in person and on social media, much to the delight of the billionaires of both parties who have been pulling their strings as though they are mindless puppets.

George Carlin on education and political corruption

In the meantime, three billionaires own more wealth than the bottom 50 percent of Americans. According to Inequality.org, as of November 17, “the combined wealth of 647 U.S. billionaires increased by almost $960 billion since mid-March, the beginning of the pandemic lockdown—an increase of nearly $1 trillion in less than a year. Since March, there are 33 new billionaires in the U.S. Driving this exploding inequality are 12 companies whose profits are coming at the expense of workers and communities. These “Delinquent Dozen” companies are emblematic of the corporate greed that has grown rampant over the last 40 years. They include retailers like Walmart, Amazon, Target, and Dollar Tree and Dollar Store, gig economy companies like Instacart, and food producers like Tyson Foods.”

Worse yet, this massive increase in wealth inequality is driven by a huge rise in income inequality. The top 1 percent now take roughly anywhere from 25 to 40 percent of the total income produced every year in the United States, depending on whose stats you use. This is up from 8 percent in 1980. Extreme poverty has risen over the last thirty years from 36 percent of the world’s people to roughly 50 percent as massive amounts of income and wealth have been redistributed from the poorest to the most wealthy. The world’s 2,153 billionaires have more wealth than the 4.6 billion people who make up 60 percent of the planet’s population, according to a recent study by Oxfam. See https://www.oxfam.org/en/press-releases/worlds-billionaires-have-more-wealth-46-billion-people

During these decades our democracy has been turned into a plutocracy (government of the rich, by the rich, and for the rich), our utterly corrupt Supreme Court has given massive power to the rich via their corporations while weakening our labor unions, which was once the primary counter balance to corporate power in the United States.

Sure, there are important issues the billionaires and their corporate news media have directed our attention to, such as transgender bathrooms, voter fraud, racism, gay rights, wars against Christmas, wars against women, global warming, abortion, wars for and against dirty diapers, etc…. While most of these are important issues for which many of us are passionate about, they are also issues intended to take our eyes off the prize.

Take racism, for example. Most of the people impacted by extreme poverty (defined in 1990 as living on $1.90 a day) throughout the world are our brown and black brothers and sisters from lesser developed nations. And yet, the policies which have pushed more and more of these people into extreme poverty, such as international trade agreements involving the United States, and lending actions by the U.S. dominated World Bank, are pushed by billionaire controlled politicians of both major political parties. Racism is never talked about in this context because the billionaires have directed our attention away from racist economic policies and how these policies have been directed by Republican and Democratic Party leaders over the last four decades and have pretty much kept our eyes off the big pictures of income and wealth inequality and how these two policies impact all working people, but in particular, black and brown people.

If the electoral college was eliminated, the Republican Party would be a largely permanent minority party unable to stop the Democratic Party leaders from enacting the demands of the Democratic Party grassroots for reforms, some of which would reverse income and wealth inequality, such as raising the federal minimum wage to $15 an hour, which would cut into corporate profits, as well as ever rising share prices and dividends, which is the primary conduit by which the rich receive their income and wealth. Immigration reform would succeed, but the current policies are very profitable for a handful of publicly traded corporations, and which benefit billionaires.

The indispensable enemies must continue to coexist so as to provide the illusion of democracy. Eliminating the electoral college would go a long way toward destroying the illusion, which is something the billionaires do not want.

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I wonder how bad this economic downturn is going to be. This recession just began in February 2020. The economy is opening up for the first time since the coronavirus struck the United States and people are saying the economy is going to pop right out of its slump. I doubt that.

This week, I saw all kinds of people standing in the soup line three blocks long, which was three blocks longer than two weeks ago. Facebook just laid off my friend across the street a couple weeks ago. Just a week ago, a long-time friend was furloughed from her job for the summer. My domestic partner has seen her hours reduced at work. Middle class families are rummaging through my garbage and recycle bins. The rich are getting richer. Maybe that was the big boys plan.

No, I just do not see an economic recovery around the corner. I see a deep recession. One of my local bicycle stores is closed, along with two bakeries, the coffee shop, the chocolate shop, my chiropractor and others. Four blocks away two Vietnamese restaurants have closed permanently along with a pizza parlor. Seven blocks away the Roseway Theater is shuttered. Next to it the wedding store is closed forever, and next door to that the appliance repair store is gone. All have closed permanently since March 2020. All have been open since at least the 1980s. The Roseway Theater had been open since 1924.

The coronavirus pandemic ignited this recession, but its depth and misery for Americans have been caused by 40 years of relentless class warfare by the rich. The opening shots of the war began in 1971 when a little known Republican tobacco attorney named Lewis Powell wrote what is known as the Powell manifesto urging the rich to combine their resources, establish a variety of organizations to turn back the clock to the era of the robber barons, take over the courts, and generally fight back against the Constitutional and democratic rights of the vast majority of people. The rich took his advice. They organized. Out popped the Heritage Foundation, the Cato Institute, the American Legislative Exchange Council, the Federalist Society, and a lot more. Two months after he wrote his manifesto, Powell was sitting on the Supreme Court bench serving the rich as a legalized guerilla fighter in their war against the rest of us.

The Roseway Theater is closed and that financially helps streaming corporations like Amazon and Apple and their rich shareholders become richer. The local restaurants are gone but that financially helps Walmart, Domino’s Pizza and other major corporations and billionaire owned private equity companies by eliminating the local competition, and their rich shareholders are prospering at the expense of local business people, the real entrepreneurs, people who are our neighbors. The local coffee shops are gone, and that helps the affluent shareholders of Starbucks and other major coffee corporations get richer.

A recent poll shows 62 percent of Americans think the United States is in the toilet. Political corruption on a massive scale has done that, with the billionaires in control of both major political parties, as well as the Supreme Court. (Click here for that story)

The CARES Act of March 2020 was supposed to help the economy with loans to small businesses, but apparently, the authorized money is not enough and perhaps deliberately so. Thank you Nancy Pelosi, Mitch McConnell and Donald Trump. The CARES Act authorized $4.75 trillion to save the 1 percent who derive the vast majority of their income and wealth from major corporations.

Bloomberg reports the Federal Reserve is printing and giving billions of dollars to major corporations, such as Walmart, AT&T, and United Health. Technically, those are loans but will likely be forgiven. Meanwhile, those billions find their way into the hands of the rich via higher dividends and capital gains. Click here for that story.

If you count capital gains, the rich have gone from stealing 7 percent of all income produced in the United States in 1971 when Lewis Powell wrote the Powell Manifesto to at least 37 percent by 2016. It is likely closer to 40 percent in 2020. You can thank the corporate wing of the Supreme Court for much of that gain.

Don’t you think it’s time to forget about our petty differences on the social issues the rich have used their news organizations to get us to focus on, and unite to save ourselves against the depredations of the rich? If not for yourselves, why don’t you do it for future generations?

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Divide and conquer; nobody has done it better than the billionaires who have controlled the United States via their two major political parties and their Supreme Court for the last forty years. But first a few comments.

I wonder if the downturn of the stock market on June 9-11, 2020 was just a correction, although I am suspicious it marks an increase in market volatility on its way toward the intersection where the real downtrodden economy meets the robust Wall Street market. In which case, we could be looking at a rapid or slow and long-term decline in share prices.

I do not think a lot of people understand that we are at the beginning of a recession and not at the end. I suspect that many people were buying the stocks of corporations for the last two weeks that are going bankrupt (think Hertz) because of desperation of their financial situations since 40 percent of US adults do not have $400 to cover an emergency, not in savings, not in credit cards or other assets, if I remember correctly.

I have read and listened to many experts on the rise of the stock market since March while the economy has tanked, but I have not heard how income and wealth inequality has driven the stock markets to record highs by redistributing trillions of dollars from the 99 to the 1 percent over the last forty years, nor do I hear how financially desperate many people are; not even those who are buying bankrupt Hertz and J.C. Penny shares. Those subjects are not allowed by the billionaires who own all the major news sources.

I have a good neighbor and he just got laid off from his job and fears losing his house. I see desperation written all over his face and in the tone of his voice when I speak with him. I see the middle class families in nice cars and wearing nice clothes rummaging through the recycle bins the night before the trucks pick that stuff up. Most, but not all of these folks, did not begin their rummaging pilgrimages until March. I watched videos a few days ago of the first food lines for the middle class since the Great Depression of 1929-40, a line of 600+ cars deep, people in their new Toyota Lexus’s, and other high end newer cars, who needed to gather free food in order to feed themselves. 20 to 40 million people are unemployed and all the congress would do was save the billionaires. See The CARES Act; the Rich get $4.75 Trillion and We Get the Crumbs.

We are at the beginning of a recession that will be severe because 40 years of the greed of sociopathic rich folks who control both major political parties and the Supreme Court, and who can never get enough money, and far more than they could ever spend, and who derive almost, and in many cases, all, of their income and wealth from the ownership of corporate shares, either through capital gains, dividends or corporate bonds.

Then you have the gullible grassroots on the political right who have been led to think the communists are controlling things; and then you have the gullible on the left who think the Democratic Party leaders actually give a rat’s ass about them; for the grassroots of both the left and right, the reality is unhidden and staring straight into their eyes.

All you need to do is look at Nancy Pelosi’s Heroes Act, the fifth stimulus since coronavirus shut down the U.S.; this legislation extends the government’s extra $600 unemployment insurance per week through the end of the year, and provides other income to the 99 percent too, although much of the money in the proposed legislation will still go to the rich. Pelosi waited to push the Heroes Act through the Democratic controlled House after both Republican Senate Majority Leader Mitch McConnell and President Trump said they were not interested in a fifth stimulus. Pelosi knew the Heroes Act was grand theatre for the blind faithful even though she could have easily negotiated more money for the 99 percent with McConnell and Trump during the first, second, and third bailouts, when McConnell and Trump were desperate to save the billionaires who pull their strings, which happen to be the same strings they use to pull Nancy Pelosi with. She did not negotiate for us little folks. Did she?

The billionaires pulled the strings of Pelosi, McConnell and Trump to come up with the notorious CARES Act, which bailed out the rich and their corporations to the tune of $4.75 trillion while throwing crumbs at the masses, which made for good theatrical effect. The billionaire’s corporate news media did their duty and only reported on the crumbs and how great they were.

As for the grassroots on the right, the CARES ACT alone should tell them how insanely wrong they are to assume Democratic Party politicians are controlled by communists, and the CARES Act should tell them that Republican politicians would not give a snail’s fart to help them out during the worst economic crisis since the Great Depression. And you would think the blind followers of the Democrats could figure out that the Democratic Party politicians have not cared about them since Jimmy Carter was president.

The voters of both sides, you would think, would by now figure out that both Democratic and Republican Party politicians threw them overboard forty years ago. It only takes one thing: using your brains to put two and two together.

Billionaires own this nation, both political parties, they have at least five United States Supreme Court judges in their back pockets, along with a lot of other judges; they own the media and only tell you what they want you to believe, and most of you believe the propaganda and the lies used to turn the grassroots of the right and the left against each other.

No, this economic crisis will not be over soon. This is going to be a long economic nightmare. The rich have gotten richer while the rest of us have been drained financially dryer during the last few months alone.

We have to figure out how, as a people and as a nation, we want to come out of this crisis. Lurching forward into another economic wasteland like Argentina is for the vast majority of its people; or with a strong political change that reins in the obvious corruption at all levels of the U.S. government, and ensuring a government of, by and for the people, rather than just continuing to impoverish ourselves under the dictatorship of the billionaires.

We have a collective choice to make and the time has come to cast aside our petty differences and organize. The 1 percent were taking at least 37 percent of the income produced in this nation in 2019, up from 8 percent in 1980. They are probably raking in over 40 percent so far this year. Jeff Bezos, Warren Buffett and Bill Gates owned more wealth than the bottom 50 percent of Americans, and that was before the crisis began. They are richer now.

If our situation continues on this path, the rich will steal even more income and wealth than is currently the case. Then we will be a nation like Argentina, once boasting a prosperous middle class on a level with the best European nations, and now with a population of mostly desperate people.

In the USA, the dictatorship of the billionaires will continue and become stronger unless the grassroots of both sides come together and realize they have economic issues that bind them. Until that day, the dictatorship of the billionaires will continue to impoverish us all even more so than today.

The billionaires will continue to use their corporate media to divide us and make permanent their conquest and subversion of our democracy, our Constitution, and our governments at all levels, local, state and federal.

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The United States Bureau of Labor Statistics reported a few days ago that the U.S. economy added 2.5 million jobs in May 2020. This hardly seems likely. As you can see from the graph above, over 8 million people filed for unemployment insurance during the four weeks of May. If the U.S. economy added a total of 2.5 million workers, that means more than 10.5+ million of the unemployed returned to their jobs since you would need to add the 8+ million to the 2.5 million to get 10.5+ million. 10.5 million people would have needed to get back to their jobs after the last 1.8 million filed for unemployment insurance during the last week of May. It looks like the government is saying roughly 10.5 million people returned to work on May 30th and May 31, which is possible, but hardly likely.

The official unemployment rate is 13.3 percent when the majority of economists expected it to be closer to 20 percent.

You got to wonder about the corruption going on in government to come out with these numbers, which look like a lie. Some experts wondered what could have caused this increase in jobs.

Bloomberg news reported that, “Michelle Meyer, head of U.S. economics at Bank of America Corp., pointed to the 1.4 million jobs added in the restaurant industry and said, “maybe this is an indication that PPP (Paycheck Protection Program) is working and it’s being distributed to small businesses — restaurants — and they’re using it to bring workers back.”

And maybe not.

“Another issue is that some workers are being counted on payrolls even if their hours or pay are minimal, said Betsey Stevenson, a University of Michigan economist who was the U.S. Labor Department’s chief economist in the wake of the 2007-2009 recession.

“The problem is that Wall Street is used to predicting job loss due to a typical recession, not one in which people are temporarily sent home en masse,” Stevenson said.”

While millions of people are heading back to work in the coming weeks, the damage to the economy is likely to last a while. Sometime in the late summer or early Autumn, we will have a real idea of how badly this recession is. Unemployment should go down from here, but it will still be abnormally high since we will be in a recession that began in March.

Expect the stock markets to continue upward as the economy stays mired in recession since the government authorized the Federal Reserve to give away (officially loan) some $6.6 trillion to the rich via their major corporations. Don’t expect the Fed to carry a lot of these loans on their books. (See The CoronaVirus Stimulus Bill: The Rich Get 5 Trillion, We Get Crumbs.)

It used to be that corporate profits drove the stock markets up, but for the last ten years it has largely been the Federal Reserve and the U.S. government and corruption that has done this. The Fed printed up and handed out $26 trillion to twelve banks to cover the losses the billionaires suffered in 2008-09 (See The $26 Trillion Bailout). The bankers withheld millions of houses off the market in a clear act of conspiracy in restraint of trade that the Obama Administration turned a blind eye to since their Wall Street benefactors were cashing in on the corruption (Click here for that story). Meanwhile, corporate profits peaked in 2014 and therefore clearly have not been pushing the stock market up during the last six years; corruption has been pushing the market up.

The United States continues to see government corruption at all levels rise. The U.S. saw it drop out of the top twenty least corrupt nations for 2019, and that most likely understates how corrupt the U.S. has become. This corruption is caused by income and wealth inequality. The rich want more for themselves and less for you and corruption is part of the cost of doing business and achieving their goals.

 

 

 

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Many corporations pay no taxes, and actually receive tax rebates from the government, and much of this tax avoidance is passed on to rich investors in the form of capital gains, dividends and bond interest. Corporate tax avoidance is only one way the rich get richer at the expense of the rest of us. There are a ton of others ways this occurs. Amazon paid no federal income tax in 2018 and received a $129 million tax refund on taxes it did not pay. That $129 million and the unpaid tax money goes straight into the pockets of billionaire shareholders. Click here for other ways the government is making the rich wealthier at your expense.

Reuters reported last week that the US government is “giving millions of dollars in American taxpayer money via the CARES Act to a number of corporations that have avoided paying U.S. tax.

“In all, Reuters’ analysis of public data found around 110 publicly traded companies have each received $4 million or more in emergency aid from the program.

Of those subject to taxes,” which means profitable, “12 of the companies recently used offshore havens to cut their tax bills, the analysis found. All together, these 12 received more than $104 million in loans from U.S. taxpayers. Seven of them paid no U.S. tax at all for the past year.

The program, which provides low-interest loans that are forgivable if companies use most of the money to pay employees, has been widely criticised for problems ranging from early bottlenecks that prevented small businesses from receiving money, to confusion that led millions of dollars to be handed out to relatively affluent firms.

The Treasury Department declined to comment.

Of the almost 110 recipients of $4 million or more, Reuters found 46 paid no U.S. corporate tax for the last year.”

This is just another example of the massive corruption of both major political parties, the Supreme Court, and the Federal Reserve. The billionaires control them all.

 

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Eight weeks into the pandemic, Inequality.com reported that during the eight weeks of March 18th to May 14th 2020 thirty-six million workers became unemployed. “Over these same eight weeks, U.S. billionaires saw their wealth increase by $368.8 billion, a 12.51 percent increase. On March 18th, U.S. billionaires had a combined $2.947 trillion, down from $3.111 trillion a year earlier, according to Forbes annual global billion survey. As of May 14, total U.S. billionaire wealth has increased to $3.316 trillion.” 

Their total wealth rose during the first eight weeks of the pandemic by $205 billion compared to just last year as tens of millions of people became unemployed. Anybody see a disconnect here?

“In the last eight weeks, 14 new billionaires joined the U.S. billionaire list, which increased from 614 to 628. Even with a recent decline in markets, Elon Musk’s wealth increased $3.5 billion in the last week, since May 6. Jeff Bezos’ wealth increased by $900 million and Eric Yuan saw his wealth increase by $800 million.  Mike Bloomberg saw his wealth increase by $400 million.

Between March 18, when Forbes published their 2020 annual Global Billionaire Survey, and the morning of Thursday, May 14, these billionaires have seen their wealth surge:

  • Jeff Bezos – up $30 billion
  • Mark Zuckerberg – up $21 billion
  • Steve Ballmer – up $11.6 billion
  • Elon Musk – up $11.3 billion
  • Michael Bloomberg – up $10 billion

The top 1 percent receive almost all their wealth and income from corporations. The first four government coronavirus bailouts were written in order to save the rich and their sources of income and wealth, while the rest of us got crumbs. (Click here for that story.) U.S. income and wealth inequality has been created by a corrupt government over the last forty years. Thank you Nancy Pelosi, Mitch McConnell and Ron Wyden.  

Share prices rose since the Federal government and Fed stepped in to protect the assets of the billionaires in late March 2020 with the CARES Act, providing nice capital gains income for the billionaires in return. This increase in share prices also made CEO’s wealthier in the process. 

This should tell you how corrupt our democracy, the Fed, and both major political parties have become, and all three branches of government have become. The rich are saved from their losses, while the 99 percent eat theirs. Socialism is used to save the rich, while the vagaries of capitalism are for the rest of us. We know because the corporate news media tells us so. 

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by 

Rich Rodriguez

Spending trillions of dollars on a crisis against an invisible enemy sounds crazy, right? We just did that in the blink of an eye.

The problem is we are fighting two crises. The global COVID-19 pandemic and the environmental crisis. We’re fighting a good battle on the COVID-19 pandemic, with some winning results. In large part, we are ignoring the environmental crisis as its invisible hand is felt more and more. In 2018 some 37.1 billion metric tons of fossil-fuel CO2 was dumped in our air. There is a price to pay for this recklessness: Witness the recent Oregon wildfires.

To many, it would have seemed ludicrous just three months ago to say we need to spend trillions of dollars to reduce CO2 emissions. Yet, in the last few weeks, the White House negotiated with a cabal of oligarchs and a ruthless kingdom – to raise oil prices! Let that sink in.

From an environmental standpoint, the correct decision would have been to let the frackers go bust while simultaneously announcing investments in renewable energy, energy storage, improvements to the electric grid, and more – creating quality sustainable jobs.



Times of great crisis also creates opportunity. The White House just squandered a golden chance — and placed our existential survival at increased risk. Despite this mistake, we learned something. The people of the United States just learned it is possible to wage a war against an invisible enemy, spend trillions of dollars in the battle, and create winning results.

Let’s get it done. Beat the CO2 crises. Beat global warming. We don’t have much time.

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Not only did legislators of both major political parties make certain when writing the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) in late March 2020 that the top 0.05 percent receive 80 percent of the benefits, but they also wrote the legislation so that more than 80 percent of a change in the tax law included in the bill benefited the top, as well. This is according to a non-partisan congressional committee.

The CARES Act was sold by the government and the corporate news media as providing worker and business relief for those suffering from the coronavirus quarantine. In fact, it was written to save the financial well being of the billionaires and multi-millionaires who have corrupted both major political parties, and the federal and likely all state governments in the process. The corruption clearly extended to much of the corporate news media since few of them reported on this.

The Guardian points out that the “change – which alters what certain business owners are allowed to deduct from their taxes – will allow some of the nation’s wealthiest to avoid nearly $82 billion of tax liability in 2020.

Nearly 82% of the benefits from the tax law change will go to people making $1 million or more annually in 2020, according to an analysis by the joint committee on taxation (JCT).

Taxpayers will lose nearly $90 billion from the change, which suspends a restriction introduced in the 2017 tax bill.

The change allows owners of businesses known as pass-through entities to lower their taxes by deducting as much as they want against income unrelated to the business.

Before, owners of pass-through entities could deduct a maximum of $250,000 in losses from non-business income such as stocks and bonds. This limitation was introduced in the 2017 law to offset other tax benefits going to firms.”

The rich lost trillions of dollars in paper profits with the stock markets down around 15 percent from their all-time highs. The billionaire owners of hedge funds (largely unregulated investment businesses with 99 or fewer clients) and big-time real estate investors will be the primary beneficiaries.

Currently, the top 1 percent steal 37+ percent of all income produced in the United States compared to 8 percent in 1980. Three people (Jeff Bezos, Warren Buffett, Bill Gates) own more wealth than the bottom 50 percent of Americans. This lopsided distribution of both income and wealth has come about due to political corruption. Those at the top of the financial food chain are eating those at the bottom via corrupt politics and with deadly impacts. For example, the US white mortality rate has dropped three years in a row for the first time since the Spanish flu of 1918 struck.

I also want to point out that the CARES Act itself provides a little over $5000 to each member of the 99 percent while giving away an average of over $16 million each to the members of the top 0.01 percent, proving how rampant corruption is in the government. Click The CoronaVirus Stimulus Bill: The Rich Get 5 Trillion, We Get the Crumbs for more on that.

Click Tax change in coronavirus package overwhelmingly benefits millionaires, congressional body finds-Washington Post for more on the story.

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The United States Federal Reserve Bank (the Fed) is bailing out the billionaires again. This time the Fed is making certain that losses suffered by hedge funds are reversed. Hedge funds are not banks. They are private billionaire investment clubs which manage investments for clients and which cannot have more than 99 clients. This is why many hedge funds will not take on clients who are unwilling or unable to invest $10 million or more with them.

On March 16, 2020 the Wall Street Journal reported Hedge Funds Hit by Losses in “‘Basis Trade.’ A wide swath of hedge funds was hit by the recent unwinding of the so-called basis trade last week. The basis trade is a long-running investment that seeks to exploit pricing gaps between Treasury securities and futures.” This is a useless activity in which nothing is made, no services and no goods are produced.

The Journal went on, “The Federal Reserve rushed to repair disorderly trading conditions in the Treasury market last Thursday.” Translated, that means the Fed rushed in to make certain these billionaire investor Hedge Funds did not lose money. Not until 2008 did the Fed rush in to save billionaires from their stupid investment losses through banks and other forms of business, like hedge funds.

The Journal went on, “The Fed’s intervention Thursday and over the weekend ended up aiding Citadel and many (hedge) funds deploying the basis trade, said people familiar with the matter.” That means whatever the Fed did made certain rich folks did not lose money. Citadel manages about $30 billion for 99 or less clients.

Guess who works for Citadel. None other than Ben Bernanke, the former Chairman of the Fed, and the person who turned the Fed into a money laundering organization for billionaires back in 2008-09. The New York Times reported back in 2015, “For eight years, Ben S. Bernanke, the former Federal Reserve chairman, was steward of the world’s largest economy. Now he has signed on to advise one of Wall Street’s biggest hedge funds. Mr. Bernanke will become a senior adviser to Citadel, the $25 billion hedge fund founded by the billionaire Kenneth C. Griffin. He will offer his analysis of global economic and financial issues to Citadel’s investment committees. He will also meet with Citadel’s investors around the globe. It is the latest and most prominent move by a Washington insider through the revolving door into the financial industry.”

“In an interview, Mr. Bernanke said he was sensitive to the public’s anxieties about the “revolving door” between Wall Street and Washington and chose to go to Citadel, in part, because it “is not regulated by the Federal Reserve and I won’t be doing lobbying of any sort.”

It is odd that this billionaire investor club and other hedge funds are getting bailed out by the Fed since the Fed does not regulate them. The Fed is simply printing up money by the billions and rescuing them and their clients from their losses. Why is the Federal Reserve ensuring that billionaire investor clubs do not lose money, and how does Bernanke’s employment depend on the Fed’s actions?

Hedge funds, like Citadel, do not make produce anything that you use, such as machines, food and water. They simply gamble with other people’s billions.

Why is it that when rich people make incredibly stupid investment decisions the government and or the Fed is always there to bail them out? The answer is we do not have a democracy. We have plutocracy in which the rich rule via both of their major political parties.

The billionaires reap the benefits of the financial markets when the markets are going up but do not have to share in the losses with the 99 percent when the markets are heading down.

Historically, the Fed was supposed to serve as a central bank by providing short term loans to banks when necessary and only if the needy banks had “good collateral.” Its job is also to keep inflation and unemployment low using interest rates, and buy U.S. debt when nobody else wants to buy them. That changed in 2008 when the bank under the direction of Ben Bernanke gave $26 trillion to twelve banks, four of them foreign. That is when the Fed became a money laundering criminal enterprise for the wealthy. For that report click The CoronaVirus Stimulus Bill: The Rich Get 5 Trillion, We Get Crumbs

 

 

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