Some things to think about

The current crony capitalist system in place since the Reagan Revolution dismantled the New Deal consensus that capitalism had to serve both labor and capital is requiring ever-increasing levels of repression to milk additional increments of wealth out of labor for the benefit of capital. Currently almost 5% of the U.S. population is either in jail, on probation, or otherwise involved in the correctional system. We have more people in prison both as a percentage and as a sum total than Stalin had in his gulags.

It was amazing to see the amount of police state brute force used against the Occupy movement. We're talking about a movement that, if it had been ignored, would have simply faded away within a few weeks because people would have gotten bored and moved on. Instead it was in the headlines for weeks because of the level of brutality used to suppress it. Why in the world were the oligarchs so panicked? It's because they have just about reached the end of the amount of force they can apply to eke out tiny increments of wealth out of the labor of the 99%. When you're already applying as much force as Stalin applied, you're reaching the point where it costs more to apply additional force than you'll get as a return on that additional force.

At this point I want to mention something called "retreat mining". In pillar-and-room mining of large shelves of valuable mineral, pillars and walls of valuable ore are left standing to hold the roof up. Once the shelf has been exploited to its full extent, then starting at the back of the mine, and moving forward, the pillars and walls are systematically pulled out and as the process moves towards the front of the mine, the back part of the mine starts caving in behind them. The goal is to outrun that process of collapse, get all that valuable ore out that had been wasted as pillars and walls to hold the ceiling out, and if the whole mine ends up collapsing behind you after you get the last bits of ore out of the last pillars and walls, well who cares, right? This reminds me of what our elites are now starting to do. Because the cost of the violence to hold up the walls / keep the system from collapsing is so expensive, they're now retreat-mining -- cutting police forces and fire departments (San Jose now has fewer cops than in the early 70's when it was literally half its current size), cramming more and more prisoners into less and less space with fewer and fewer prison guards in order to save money, etc. They're hoping they can suck the very last resources out of the economy and spirit them off to safety (where?) before the whole system collapses.

Will it work? Who's going to stop them? Us silly flightless waterfowl babbling on the Internets? I don't think so! But at least there will be this record, some time in the future, of what they are doing...

-- Badtux the Violence Penguin

The problem

In the contest between regressives and progressives, regressives have a significant advantage: They're willing to provide answers to complex problems that are simple, easy to understand, and utterly wrong because they have absolutely no connection to any reality that actually exists and thus no hope of actually working if implemented. Regressives have a consistent ideology, and virtually always provide answers that are consistent with that ideology, regardless of whether those answers are actually correct.

Communism had that advantage too, during its brief 70-year time in the sun before it finally collapsed of its inherent ideological contradictions. Communism provided answers to complex problems that were simple, easy to understand, and... well. Utter failures in practice.

Progressives, on the other hand... we are inherently pragmatists. We believe in using time-tested solutions where those are possible, we believe in looking at the actual reality and adopting solutions which will solve the problems that exist in that actual reality regardless of whether said solutions are consistent with any particular ideology or -ism, and we just don't have an ideological hook to hang our hat upon. People look at what we advocate and are, like, "why are you giving us all these complex solutions that have nothing in common, instead of simple solutions like the other guys give us?" The stereotypical left-wing rally where the "Save the Whales!" crowd and the "Gay Marriage Now!" crowd are feuding with the "End the patriarchy now!" crowd is almost a parody by now, but it is a parody that has a grain of truth in it -- the world has a lot of problems, and it's going to require a lot of different approaches, a lot of different tactics and viewpoints, to solve them, and the end result is that the progressive movement appears to be fragmented and inconsistent and a mess. You simply can't hang one single ideological hook on that whole mess and present a nice neat simple frame for Joe Sixpack to understand if he accidentally turns on MSNBC rather than Fox News one night.

The problem... ah yes, the problem. I've often noted that, as the American empire winds down, times are going to get hard. Way hard. Famine, starvation, food riots, and revolution hard, maybe. People are going to be open to new solutions when they have nothing left to lose, new solutions that maybe can salvage something out of the ruins of empire and come up with something at least somewhat sustainable. The problem is that the forces of regression are going to have their nice neat simple easily-understood solutions to all our problems and are going to be waiting and ready to sell these to people, and if the forces of regression win that intellectual battle, the end result will make the fall of the Roman Empire look like a day care center squabble. The eventual body count would end up making WW2 look like a border squabble between Nicaragua and Costa Rica. The problem is that the regressives have such pretty answers to the problems of the world -- simple, ideologically consistent, and easy to understand -- when the world is actually complex and the problems of the world similarly complex, requiring solutions that are neither simple nor always easy to understand. And 50% of Americans are below average (see below "dumbass" posts)...

WASF. Just sayin'.

- Badtux the Waddling Penguin

Waiting for the explosion

I've previously talked about the concentration of wealth -- about how 60% of Americans are dirt-poor, lack access to the fundamental capital to make anything of themselves due to everything being hogged by the top 5% and especially the top 1%, and how this is not a tenable situation in a democracy. I view OWS (and to a lesser extent the teabaggers) as a symptom. People are seeing that things are getting worse for most people while certain people (the 1% in particular) thrive, and they don’t know what to do about it, so first thing they start doing is complain about it — the OWS protests. The oligarchs are betting that putting down the OWS protests with force will make everything okay for them, but the problem with that notion is that OWS is a symptom, not a cause. Suppressing OWS won't relieve that pressure building up underneath, it will simply deny it an outlet -- and it will keep building until either there is an explosion and Very Bad Things happen, or the oligarchs are forced to impose a police state so blatant and obtrusive that the notion of America as a free country would be ludicrous to even the ill-informed.

OR the oligarchs could come to their senses and realize that their current route is to either the guillotine or irrelevance. The guillotine if the explosion happens, and irrelevance if they impose a police state. Because the end game of police states is always the secret policemen taking over — see, e.g., Vladimir Putin in Russia, and the imprisonment or exile of many of the Russian oligarchs who crossed swords with him. The only solution that would allow our oligarchs to preserve their own importance is to return back to the New Deal regime of regulation and taxation that served the nation so well in the period 1945-1981, but that would require our oligarchs to be smart, and due to inbreeding (less than 10% of our oligarchs got there because of merit, the rest got there because of winning the lucky sperm contest and being born rich or going to the right school with the right people and getting a "Gentleman's C" like Dubya), they’re not all that smart anymore…

Americans have figured out the game is rigged, and they want it fixed. They want the America of their parents and grandparents, when hard work and education provided you with a living. If something isn’t done to take us back to when that was so, all hell will break loose, with uncertain results. Well, let me rephrase that. The results will be *disaster*. Because I can't think of any violent revolution, anywhere, that has ever ended up well. They always ended up with thugs of the worst kind in charge. Maybe mailing Marie Antoinette Action Figures to the CEO's of the Fortune 500 and to every Senator and Representative would make that clearer (note that the outcome of the French Revolution was *disaster* for France -- virtually every French male between ages 18 and 35 ended up *DEAD*), but frankly I doubt that our feudal overlords are smart enough to "get it". More likely they'd just arrest you for terrorist threats or some shit like that...

- Badtux the Waiting-for-the-explosion Penguin

Capitalism and the myth of job creators

So a small business owner says to me, "I took over a failing furniture store chain with 100 employees, and made it thrive again, saving 100 jobs." At which point, I say "Uhm, no."

See, here's the deal. Capitalism is all about matching supply and demand and when properly functioning, the fate of any specific business is of no relevance. If this guy's furniture chain had failed because of mismanagement and stocking furniture that people didn't like, some other furniture company would have arisen or expanded to provide the furniture that customers wanted. The 100 people would have gone to work for that other furniture company, because furniture doesn't sell and distribute itself, yo -- people would need to be hired to do it.

In short, capitalism, where it exists, basically insures that the furniture sector will have pretty much a constant number of employees because the number of people buying furniture in a given year is pretty much constant. In other words, it's the customers who created those jobs, and unless the number of customers somehow takes a dive -- like, say, in a depression -- the fate of any specific furniture company is irrelevant. A company fails, there is still demand for furniture, and in capitalism some other company will adapt or arise to fulfill that demand and will hire the people laid off by the failed company. In short, all that one company failing does, in a capitalist economy, is shift people around to some other company where they can best fulfill consumer demand. It's just a game of musical chairs in the end -- in a capitalist economy.

Of course, what we have here in America today isn't a capitalist economy, it's what's called "crony capitalism", where a small set of very wealthy businesses use various tactics such as regulatory capture and monopolistic practices to make sure they don't have to compete in a free market. But I'll discuss that in a further discourse on, "What is capitalism, and why don't we have it in America?"

-- Badtux the Capitalist Penguin

Air Farce spends $150M apiece on paperweights

F-22 fighters still suffocating their pilots. As a result, most of the F-22 fleet is grounded *again* and pilot training has ceased. But never fear, the Pentagon assures us that the fleet could fly at a moment's notice if needed. Of course, that isn't happening, because there's a term to describe untrained pilots in $150M jets in combat situations: Skeet. And believe it or not, the Pentagon is *not* going to send out $150M jets to get shot down like overgrown clay pigeons, yo.

Meaning: If we have an enemy that requires the F-22 to counter it, my advice to pilots is to stock up on slingshots and rocks. That's pretty much all that's gonna be flyin', yo.

-- Badtux the Snarky Penguin

Hating

The criminal enterprise that is News Corpse

Hot on the heels of the scandal where Rupert Murdoch's papers wiretapped the Royal Family (bad show, wot -- those limeys seem to like their inbred snooty royals, go figure), now it appears that Sir Rupe's criminal enterprises have extended to circulation fraud -- basically defrauding advertisers. Senior executives in New York, including Murdoch's right-hand man, Les Hinton, were alerted to the problems last year by an internal whistleblower and apparently chose to take no action. The whistleblower was then made redundant.

In short: News Corpse committed a crime -- fraud -- against its advertisers by claiming it had one circulation, when it actually had a (much smaller) one. Looking for Sir Rupe to go to jail in 3... 2.... 1... *NEVER*. Because it's always a "few bad apples" who do these criminal things, right?

-- Badtux the Snarky Penguin

Why does paper X publish always-wrong pundit Y?

Because he says what their millionaire owners and advertisers want to hear. Duh. It's called "capitalism", as in, "serves capital, not the public." The notion of the press as watchdog is a fairly recent one, and itself was manufactured by the same media owners. Before recent times, it was widely accepted that the press served its owners, not the public, and newspapers generally wore their biases and affiliations on their sleeve in much the same way the UK press still does (so you have the blatantly socialist Independent, the blatantly Tory Times, the blatantly Labour Guardian, and so forth). I must say that the PR effort has been fairly successful in producing the notion that the press *should* serve the public, but that's never been the primary purpose of the press, ever, in this nation's history. The first purpose of the press has always been to serve its owners, the second purpose has always been to serve its advertisers, anything else is just gravy used to sell newspapers or get people to watch television or etc.

So the question you should ask, when you see, e.g., nearly-always-wrong Thomas Friedman (of the famed Friedman Unit) published in the NYT, "In what way does publishing Friedman serve the interests of the New York Times' owners and advertisers?" Insofar as publishing him helps promote views that benefit them, why *should* they care that what Friedman serves up is a bitter stew of straw? Does it drive away readers? No, they just go on to read Krugman. So what's the *downside* to publishing Friedman, for the owners and advertisers of the New York Times?

-- Badtux the News Penguin

Bond vigilantes

So S&P gave a "negative" rating to U.S. Treasuries because of all the teabaggery going on in the House of Representatives. YAWN. S&P is the same outfit that said that a bundle of liar loans guaranteed to go bad was an AAA-grade mortgage-backed security, remember? And the teabaggers as usual whine that continued deficit spending during a depression will cause bond vigilantes are going to show up right now, any moment now, to drive the interest rates on U.S. Treasury securities up into the stratosphere. So what's happening there? This penguin went off to Bankrate.com and found.... THIS:

	This week	Month ago	Year ago
One-Year Treasury Constant Maturity	0.24	0.23	0.44
91-day T-bill auction avg disc rate	0.060	0.095	0.145
182-day T-bill auction avg disc rate	0.110	0.150	0.220
Two-Year Treasury Constant Maturity	0.77	0.61	1.05
Five-Year Treasury Constant Maturity	2.22	1.95	2.57
Ten-Year Treasury Constant Maturity	3.51	3.29	3.85
One-Year CMT (Monthly)	0.26	0.29	0.40
One-Year MTA	0.295	0.307	0.421

The interest paid by Treasuries was low a year ago, and is even lower today. No bond vigilantes in sight. None likely to ever be in sight, since the Federal Reserve would step in thanks to that ultra-modern invention the PRINTING PRESS (invented fairly recently -- in 1440 -- recent in geological time, anyhow!) and print money to buy Treasuries if there were ever any risk of not selling out an issue for a reasonable price and thus a bond vigilante would be shooting himself in the foot betting on a rise in interest rate on Treasuries. But I'm sure the bond vigilantes will show up any minute now to bid up the costs of U.S. Treasuries. Right after they finish petting their pink unicorns under their cotton candy trees, eh?

-- Badtux the Snarky Economics Penguin

After the Gulch

Thinking about it, I was rather unfair to the denizens of Galt's Gulch, the richest 400 people in America. After all, they have 50% of the assets of America, they can certainly afford to bring with them all the materials and farm tools they would need in order to make a nice home for themselves in Galt's Gulch. A few of them even have theoretical knowledge of how to use these, and a few of them -- in the technology industry, mostly -- have even used a few small hand tools themselves, though not recently. For example, Amazon.com founder Jeff Bezos has actually used a screwdriver. Granted, he was only 18 months old at the time, but at least he knows what a screwdriver is, unlike Cindy Walton.

Still, the end result will be starvation and death for the denizens of Galt's Gulch. Even with all the farm tools in the world, if you've never farmed before the likelihood of managing to grow a crop is pretty slim. And the 400 have no practical skills in how to repair farm equipment, not to mention that they can't even fuel their tractors and bulldozers without paying money to the hated peasants outside the Gulch, which they have foresaken doing because the peasants are just leaches and dimwits beside their obvious brilliance. So it might take six months, or a year, or two years, but eventually the last denizen of Galt's Gulch shall perish from hunger, likely after gnawing the last shreds of meat off the raw carcass of the next-to-the-last denizen of Galt's Gulch (raw carcass because, again, the 400 richest people in America may have a *theoretical* notion of how to light a fire and cook meat over it, but the number of said richest people who've actually done so is not likely to be very high).

So anyhow, enough of Galt's Gulch. So what happens to the rest of the world once the denizens of Galt's Gulch go into hiding in their hidden valley? Well..

At your local Wal-Mart, the trucks come in with merchandise as usual, and the workers unload them and stack them on the shelves as usual. The store managers walk their stores as usual and approve hiring of workers and accept resignations of workers and the store's computers send the day's sales to Walmart Bentonville every day, and the computers at Walmart Bentonville issue orders to their suppliers every day. The supplier relations specialists in Bentonville keep contacting their equivalents at their suppliers to negotiate pricing and availability as contracts expire. At suppliers, the product managers continue developing new products and getting approval from the VP of Marketing to put them into production, and selling these products to Wal-Mart.

Then one day, it's time for the monthly board of directors' meeting, and neither Jim Walton nor Robson Walton show up. The CEO asks, "Has anybody seen Jim or Rob?" Nobody has. "Oh well, we don't need them for a quorum, let's get the reports from our operating units and make any decisions we need to make." And they do.

Ten months later, it's time for the annual shareholder's meeting, where the board of directors has to be re-elected by the shareholders and... err... the biggest shareholders, every single one of the Walton family, are missing. Neither hide nor hair has been seen of them for almost a year now. The board shrugs, and renominates themselves as well as two more people to take the board positions of the two Waltons who are no longer around.

At some point someone asks, "Sayyyy.... nobody's seen the 400 richest people in America recently. Is something going on? Have they been kidnapped or something?" The FBI goes to the homes of the top five people on the Forbes 400 list, and manage to badge their way past the guards and ascertain that the guards have not seen their employer in over a year and that their employer's business manager continues signing their paychecks as usual. Said business manager says she hasn't seen her employer either but assumes said employer is at one of their other homes. The FBI gets a court order to search the home under reasonable suspicion that a murder or kidnapping may have taken place, and find clues to where the Galt-goers have gone. They go to Galt Gulch and find all 400 corpses plus the corpses of their spouses and heirs, many horribly mangled due to cannibalism. The world is agoggle about how horrible it was that the 400 went to such extremes to remove themselves from the presence of their "inferiors" yet came to such a terrible end. And then...

... the world goes on, as it's been going on for the past year without these "masters of the universe". The 400 took their spouses and heirs to Galt's Gulch with them and there were no survivors and they left no wills, so the ownership of the properties and corporate shares that they owned devolves to the unclaimed property division of the states the 400 resided in, which then auctions them off and has plenty to pay off their state's entire debt plus any deficits caused by recessions. New owners take over and let the employees continue running the companies, as has been true for the past year that the owners were nowhere around. In the end, all that happens is that the 400 proved just how little they contributed to the economy, which didn't even notice they were missing until the FBI found the gory evidence of a Donner Party Event in Galt's Gulch.

-- Badtux the Fiction Penguin

Missive from Galt Gulch

"There are two novels that can change a bookish 14-year old's life: The Lord of the Rings and Atlas Shrugged. One is a childish fantasy that often engenders a lifelong obsession with its unbelievable heroes, leading to an emotionally stunted, socially crippled adulthood, unable to deal with the real world. The other, of course, involves orcs." -- John Rogers.

So the top 400 richest people on the planet decide they're sick of dealing with the little people, and retire to Galt Gulch.

Day one: Four hundred people wander around Galt Gulch. "Where's my mansion?" Christy Walton asks. "I think we're supposed to build our own shelters," Larry Ellison replies. "I'll just hire some Mexicans to build me a new mansion," Charles Kotch says. Bill Gates mutters, "Do you see any Mexicans here?" Jim Walton says, "Just go to the nearest Wal-Mart and shout 'La Migra!' at the top of your voice, and stand outside. You'll see plenty of Mexicans to hire." "There's no Wal-Marts here," David Kotch says in an irritated voice. Alice Walton looks shocked, and says "What do you mean there's no Wal-Mart here? There's Wal-Marts like, everywhere!"

Warren Buffet sighs. "We have rocks and we have trees. All we have to do is pile up rocks into walls, and cut down the trees to use the wood to make roofs." "But I might break my nails!" Christy Walton screeches, a look of horror on her face. Michael Bloomberg interjects, "First things first. I'm hungry. What's for dinner?" Larry Page wanders by, a confused look on his face. "Just go onto Google Maps and look for nearby takeout restaurants and order something," he says. "Dolt!" snaps Sergey Brin, "We don't have computers here, and there are no restaurants, this is Galt Gulch, not Galt Silicon Valley!" Sheldon Adelson says, "I have a candy bar. I'll bet you this candy bar that nobody knows how to cook in this gulch." George Soros snarks, "I'll take that bet, because my fellow rich people are dolts, morons, and idiots, helpless without their serfs to do their every bidding." Michael Dell irritably says "That's mean, George. Anyhow, the answer is clear. I'll just use my credit card to buy that candy bar from Sheldon, and sell it on the Internet." "Monkeys! Monkeys! I see monkeys!" Steve Balmer shouts, and Paul Allen looks around, "hey, maybe we could eat those for dinner." Jeff Bezos says "Sure, just order a barbecue grill and a cigarette lighter from Amazon.com and we'll have barbecue monkey for dinner." Ann Chambers asks, "has anybody seen my nurse? I feel a fainting spell coming on." John Paulson snaps, "We don't need those little people. We are the masters of the universe. We own everything." "That's okay," Donald Bren says. "I'll just hire some contractors to bulldoze all this and put up a McMansion tract housing plot." Abigail Johnson helpfully says, "I think if we provide a mortgage-backed security for that application, we can obtain a significantly higher profit." Phil Knight says "so do you know how to drive a bulldozer, Donald?" and Donald looks at Phil with a look of horror that says "what, me, get my hands dirty?" Carl Icahn then says "let's do a leveraged buyout of bulldozer drivers." Ron Perelman yells, "Does anybody here know how to drive a bulldozer?" Silence follows.

As darkness falls, the 400 denizens of Galt Gulch huddle, hungry and cold, under the marginal shelter of the sparse trees populating the gulch. But they do not huddle in silence. As they huddle, they talk excitedly about new kinds of CDO's, leveraged buyouts, Internet search algorithms, optimal investment strategies, and the advantages of computerized inventory control. Over the next few days, the denizens of Galt Gulch slowly fade away, until in the end there are only 400 corpses, doomed by their inability to, like, actually do anything for themselves, as vs loot things from other people.

The End.

The above is, alas, a work of fiction. Oh well.

-- Badtux the "Too Bad" Penguin

The bottom line

Michael Moore says that America is not broke but, rather, that 400 individuals have managed to loot half the wealth of the nation and are holding us hostage. Is he right? Well, let's look at a couple of nice pictures. Here is the situation in 2007, before the massive bailouts transferred even more wealth to the top 1% (click the images to make them bigger): So in 2007, the top 1% had 43% of the wealth. It's well within the realm of possibility that after the hundreds of billions of dollars of bailouts, the top 1% could have more than 50% of the wealth. So whether Michael Moore is 100% correct or not, he's right that the top 1% owns an obscene amount of America.

So what are the repercussions of allowing the top 1% to hold this gun to our head and say "your money or we crash your economy"? Well, EBM points us to this nice little picture showing the consequences of tax breaks for the rich and what they say about the priorities of our so-called leaders:

Any questions?

As Jazzbumpa is fond of saying: WASF.

- Badtux the Waddling Penguin

Enablers of fraud

In my previous post I had a throw-away line about the pension funds suing the folks involved in the sub-prime scandal, including the credit agencies that fraudulently rated the toxic junk as "AAA+ investment grade". At which point the argument "Free speech! Free speech!" comes up.

But: There is no free-speech protection when it comes to matters of fraud. It is already known fact obtained via discovery of internal documents in current lawsuits that the ratings agencies were awarding investment grades to bonds that even analysts in the company thought were risky. It's hard to describe that as anything other than fraud.

The ratings agencies have spent a large fortune these past two years fending off legal and political attacks upon their fraudulent ratings. Fraud -- willful deceit -- is not free speech. Fraud is crime -- a crime in all 50 states of the United States. There are numerous lawsuits by pension funds -- including the massive CalPERS pension fund -- against the credit rating agencies for their complicity in fraud. The sad thing is that we're not seeing criminal prosecutions too. . The notion that credit agencies should be immune to prosecution when they are clearly complicit in fraud by awarding investment grades to investments THAT THEY KNEW WERE NOT INVESTMENT GRADE is as daft as the notion that a con artist should be immune to prosecution because the mark shoulda known that it was a con.

- Badtux the Legal Penguin

The new ownership society

So, asks a puzzled person, isn't the massive wealth redistribution that has happened over the past thirty years bad for the wealthy too? After all, the companies they own need customers for their goods, and if nobody has any money other than the wealthy, then there's less goods sold, and the wealthy get less money.

Ah, but... see, the thing is, money isn't wealth. Wealth is GOODS AND SERVICES. Money is just a handy intermediary to use to transfer goods and services around. What is wealth is what you *buy* with money -- things like, say, dachas on the Black Sea, McMansions on the ring road, that sort of thing.

During times of inflation, people took on debt or purchased assets at inflated costs. During times of deflation, people can not pay their debts in the now-suddenly-scarcer currency, and have everything taken from them by the ownership class. From 1937 to 2008, thanks to years of Keynesian economics, the supply of currency rose every year. Note that monetary inflation is the same thing as debt deflation -- your debts become worth less in real terms every year during times of inflation. People made major life decisions such as purchasing a home based upon the notion that prices would always rise -- a notion which 70 years of Keynesian economics applied to the money supply reinforced, because nobody under the age of 70 had any experience with monetary deflation (that is, shrinkage of the money supply -- NOT AT ALL the same as price and wage deflation, which lags monetary deflation for reasons I've previously discussed here). These people made a decision which seemed reasonable given their life's experience... and then had the stool of their entire life's experience kicked out from under them as they hung in the air and money suddenly became much scarcer.

So what's the end game? The new ownership society is where the wealthy own *everything* because the money supply has crashed so far that nobody can pay their debts -- and the owner class buys up the defaulted assets for pennies on the dollar. At that point, the ownership class really doesn't care if the money supply collapses all the way and they can't sell anything for money. Because they will own you. Think Latin America's oligarchs. They own everything, so their minions have no place to go and must labor in their fields and workshops to produce the hand-made goods and services they want. Their every need is taken care of by their serfs, who beg for crumbs of bread in exchange for being allowed the privilege of placing a bathrobe upon their master's back upon their master exiting his bath. What few things they need that their serfs cannot make in their master's workshop are bought by exporting agricultural goods, natural resources, and hand-made items from those workshops to more civilized nations and getting the technological goods they want back in return. Do these people care that they can't sell anything to their serfs? No. And neither will our ownership class, once they own everything -- including us.

-- Badtux the Apocalyptic Penguin

It is what it is

The middle class is being downsized away. There's a few folks like me whose creativity is hard to outsource and who get good salaries as a result. And then there's the former middle class, no longer needed partly because they've been outsourced to India and China... but also because we're just too damned good at making shit nowdays. As in, only 10% of U.S. workers are involved in manufacturing... but the United States is still the world's biggest manufacturer, even today with China making all our cheap shit and Latin America making all our underwear.

The deal is that technology has made probably 90% of all middle class jobs unnecessary. That was papered over for a while by putting the middle class to work trading dot-com stocks and selling overpriced real estate to one another, but the reality is that the jobs the middle class once worked are gone, and those jobs aren't coming back.

When there is only one solution, people adopt it sooner or later however much they hate it. With a permanent situation of more people than jobs, the unemployed will be supported from the general wealth. Call it Socialism or Christianity or whatever you please, but there's going to have to be a change in how our economy is organized because people do not voluntarily starve to death. They just don't. Hungry desperate people will do whatever it takes -- whatever it takes -- to survive, because humanity is a race of two-legged cockroaches in the end. The Republicans don't understand this, because they figure the entire world can be organized like Mexico -- i.e., them on top, and everybody else starving peasants. But that only works in low-tech resource extraction economies where the people don't have the resources available to do something about it. Once they do have the resources.... well. Bad Things Happen. Let's put it that way.

So: Reality is what it is. We will have socialism in America -- at least to some extent. Either that, or there won't be an America, just Somalia West, complete with warring warlords shelling each other's neighborhoods with artillery...

-- Badtux the Reality-based Penguin

Oh yeah, that investigation of BP

A right wingnut asked why I didn't have a post about the "independent" inquiry that "cleared" BP of misconduct in the Gulf Coast oil spill. Was I embarrassed, he asked?

Err, no. More like just smiling and nodding knowingly, because it was clear from the beginning that the government was going to do their best to cover up BP’s liability, starting from the fact that they actively hindered researchers from gathering information that could have independently established the extent of the oil flow, to their statements in the media that basically gave BP atta-boys for their response to the oil spill. So this “independent enquiry” (which had no subpoena power and no ability to, like, actually question the crewmembers on the drillrig or examine the real physical evidence) is just more of the same, just another sop to throw the rubes so that the American public won’t try to make mean old BP pay for destroying the ecology of the U.S. Gulf Coast for the next 20 years. You’ll note that I don’t post every morning about the Sun rising above the horizon either… I mean, why post about the obvious and predictable, duh?

So anyhow, there ya have it. Sun rose in the East this morning. Government released another whitewash report trying to hide corporate misconduct today. Yawwnnnnn... bore-ing!

-- Badtux the Snarky Penguin

Siberia

I didn't even know BP had operations in Siberia. Apparently Tony Hayward, soon to be former CEO of BP, is now going to get his life back. I wonder if one of the former gulags has now been chosen as BP's new corporate HQ in Russia?

-- Badtux the Snarky Penguin

Goldman Sachs in a nutshell

They're crooks, and they're going down. Sadly, as a civil case, not a criminal case. Why a civil case? Because according to the above securities attorney, the civil case is a slam dunk -- in civil cases, you don't have to prove criminal intent to defraud, all you have to show is that they misrepresented the security, and knew they misrepresented the security. Going for the criminal charge, on the other hand, and you have to prove that the misrepresentation was intended to defraud the investors. Much harder to prove.

- Badtux the Law Penguin

Welfare for rich people

The York family, who own the San Francisco 49ers, are leaving San Francisco in a snit after the City of San Francisco refused to give them corporate welfare to replace the perfectly functional but "obsolete" Candlestick Park. The deal being that Candlestick has too many "cheap seats" and not enough expensive corporate sky boxes that could be auctioned off for millions per year to enable the Yorks to pay their mediocre on-field "talent" more millions than they're worth.

So here come the Yorks into little Santa Clara, who they're trying to con into building a new football stadium for the 49ers on a patch of city-owned land near Great America Theme Park. In the process, they're spending millions on glossy lies and bullshit to gull the small-town Santa Clarans into mortgaging their future for the sake of a gigantic white elephant that will be used eight (8) times per year and otherwise sit empty.

Lies? Well, yes. Lies like:

• "It will put Santa Clara on the map." Yeah, like the Dallas Cowboys put Arlington, Texas, on the map? Hello, can any of you find Arlington on the map and tell me any benefit it's gotten from having the Cowboys stadium there? Santa Clara has a nice high-tech center in that area, Oracle/Sun, Yahoo, Nortel, etc. all have major facilities there, how will a stadium help Santa Clara gain more high-tech business than it's already achieved? Ain't happenin'.
• "It won't cost tax money." Bullshit. The 49ers are leaving San Francisco because San Francisco refuses to spend tax money on their stadium, and they think Santa Clara is gullible enough to go for that? The 49ers are raiding taxpayer funds big-time -- the city proposes raiding redevelopment funds intended for redeveloping depressed warehouse areas (funds that will need to be replaced via, duh, TAXES) *plus* raiding the municipal utility's capital improvements fund, which will need to be replaced via, duh, raising electrical rates (same damned thing as a tax).
• "It will create jobs". For eight weekends a year. Low wage jobs. And for four of those weekends, it will *destroy* jobs, because Great America will be forced to close down on game days. Great America currently earns a large amount of money on late summer / early fall weekends, and will be forced to lay off hundreds of workers on those days that the stadium has streets clogged and Great America's parking lots full of cars illegally parking there. And if this eliminates Great America's profitability altogether, Great America will close altogether -- which will cost thousands of jobs. If you want to create jobs, use that parking lot to lure the corporate headquarters of some major technology company, not for a white elephant stadium.
• "It will generate millions in property taxes for local schools." Yeah right. Pull the other leg. Like I said, you want millions in property taxes, get another high-tech company in there to complement the dozens of other high-tech companies that have their corporate HQ or U.S. offices in the vicinity, such as Yahoo, Sun/Oracle, Marvell, Nortel, etc.
• "It will be good for the city." Yeah, like that stadium in East Rutherford, New Jersey, where two major league teams play, which has turned East Rutherford into paradise on Earth... well... maybe not.

The reality is that every single NFL stadium in America built over the past three decades has been a gigantic boondoggle. They've all made promises like the 49ers are making, and they all broke those promises and left taxpayers with the choice of paying hundreds of millions of dollars in cost overruns, or having a half-completed construction site cluttering their city. Every single team has promised that there would be no taxpayer dollars used to operate or maintain the stadium, and every single team has broken that promise. The 49ers are leaving San Francisco because the city won't subsidize them with taxpayer money, yet they promise they will stay in Santa Clara without needing taxpayer subsidies? Bullsh*t. They're lying. Their past history -- and the past history of NFL teams in general that have made these same exact promises -- shows that it's going to be an expensive drain on the city treasury and that public services like police, fire, etc. are all going to suffer because of the money drain. They make all these promises in these glossy brochures, but promises are cheap, and promises are empty. Look at their history, people. These rich NFL owners are welfare whores, and once they get their hooks into your city, they will suck your city dry with their incessant demands for corporate welfare and their threats to leave if they don't get the welfare they want. San Francisco is showing these welfare whores the door, and Santa Clara wants to be their next victim? Talk about small-town rubes! Siiiiiiigh....

-- Badtux the Welfare-sniffin' Penguin

For more information:

• Save Santa Clara.
• Santa Clara Plays Fair
• SCPF Blog
• Stadium Facts blog

Only half of America is in recession

Care to guess which half? I'll give you a hint: Any questions?

-- Badtux the Snarky Penguin