* OCCUPY WALL STREET IS HERE TO STAY
By Adam Lempel, The Bloody Cross Roads
They keep trying, but they keep failing. The elites are doing everything in their power to crush the revolution. But they will continue to fail. Every time they crack down we just get bigger.
After Bloomberg launched a most vicious, illegal and egregious raid on Liberty Square, we bounced right back. I spent all Tuesday at the park, and at first it was depressing. Seeing the police occupying Zuccotti Park in blatant contempt of a preliminary judicial ruling was tough. But I saw someone holding a sign thanking Bloomberg for being the best propaganda vehicle for our revolution. He was dead silent as he brandished his message, clearly tired, but steadfast in demeanor.
I walked up to him in the hopes of finding inspiration. I introduced myself, saying I appreciate his optimism but cannot find a reason to be optimistic myself; “I’ve been here since day one but feel really down; can you tell me why I should be hopeful?” I asked. A big smile lit his face up, brimming with exuberance and assurance. He said his name is Murdoch.
“Dude, I’m thirty six. I’ve been doing activism for years. But I gave up a while ago. It seemed hopeless. But OWS has brought me back into the fight. You guys give me hope. We can’t fail. You know why? Because we’ve already got people talking. After only two months, we’ve gotten people to start talking about issues they never discuss in ways they never have before—inequality, democracy, empire, etc. It’s not supposed to be easy. The Revolution upon which this country was founded wasn’t easy. Civil rights wasn’t easy. Universal suffrage wasn’t easy. And that’s because change comes through struggle. That’s the only way. But we’re gonna win this man.”
That night, OWS hosted its largest General Assembly yet. Thousands flocked to the park in spite of or perhaps because of the draconian police presence. We had been punched in the gut, but not knocked out. We shared stories from that morning’s horrors. And we moved on, planning our next step as a group, true to our democratic principles. […]
* ENDGAME: WHEN DEBT IS FRAUD, DEBT FORGIVENESS IS THE LAST AND ONLY REMEDY
By Zeus Yamouyiannis, Ph.D, Of Two Minds
We hold this to be self-evident: When Debt is Fraud, Debt Forgiveness is the Last and Only Remedy.
Today I present an important guest essay by long-time contributor Zeus Yiamouyiannis, who suggests that when debt is essentially fraudulent, then debt forgiveness is both the logical and the only remedy. In case you missed his previous analyses on oftwominds.com, I list some of Zeus’s previous essays at the end of the entry.
Finally serious economists are considering a position I have been maintaining and writing about since the 2008 financial meltdown. Whatever its name— erasure, repudiation, abolishment, cancellation, jubilee—debt forgiveness, will have to eventually emerge forefront in global efforts to solve an ongoing systemic financial crisis.
“On a grand scale the only way to erase counterfeit money and (counterfeit) assets of hundreds of trillions of dollars is to erase the debts associated with those fake assets. (Let me underscore again, these are not “toxic” assets, they are fake assets.)… Forgiveness in general, and forgiveness of debt in particular, stand as virtues if they free us up to acknowledge, address, and learn from our culpability, start anew, and create forward.” ( The Big Squeeze, Part 3: The Quiet Rebellion: Civil Disobedience, Local Markets, and Debt Erasure (January 29, 2011)
Debt forgiveness, therefore, accomplishes two important things. It eliminates the increasing and outsized portion of productive enterprise to pay off unproductive obligations, and it clears the ground for new opportunities, new thinking, invention, and entrepreneurialism. This is why the ability to declare bankruptcy is so essential in the pursuit of both happiness and innovation.
Currently we are mired in a “new normal” and calls for “austerity” which are nothing more than the delusional efforts of a status quo to avoid the consequences of its own error and fraud and to profit evermore. So bedazzled by the false wealth created by debt multiplication and its concomitant fantasy of ever-higher returns, this status quo continues to be stupidly amazed that people are not spending and that the economy is not picking up. But how could it be otherwise?
Productive wealth has been trapped in a web of parasitic theft, counterfeiting, liability evasion, non-regulation, and prosecutorial non-accountability. All the fundamental attributes of a functioning exchange economy have been warped to reward creative criminals. I spoke extensively about this in my posts from 2008. ( Imaginary Worth, Empire of Debt: How Modern Finance Created Its Own Downfall (October 15, 2008) […]
* UNLEASHING THE FUTURE: ADVANCING PROSPERITY THROUGH DEBT FORGIVENESS (PART 1)
By Zeus Yamouyiannis, Ph.D, Of Two Minds
1) Debt that cannot (vs. “will not”) be practically paid is not a debt in its classical sense. It’s a default. Whether or not people want to recognize this reality is another issue. We recognize that a law that cannot be enforced is not really a law in any practical sense, so why are we dragging our feet with debt? Greece cannot pay its debt by any rational formula. It is already in default. Extending and pretending does not materially change this fact, it only delays recognition of the stark, enduring reality.
2) Debt based in fraudulent lending is also not true debt in any meaningful sense, since the loan along with its obligations originated from something (private fiat) that had no valid authority or exchange value to begin with. Much of the current worldwide debt simply stems from lending based in fraud numbering in the hundreds of trillions of dollars by institutions who did not have adequate collateral (i.e. held insufficient capital reserves, engaged in mark-to-fantasy accounting of their assets, assigned real value to fake assets like credit default swaps, etc.). A lending body cannot give effectively nothing to someone (claiming it is something) and legitimately expect to get something real back.
3) When debt systems are flooded with fraudulent currencies and claims, it is not true that someone, either the borrower or lender, will have to pay the “false value”-backed debt. You are not legally allowed to profit from crime nor legally obligated to support crime. This precludes the payment of many of the debts currently in circulation. In committing wide-scale control fraud, major financial institutions have broken laws. The laws they have broken are enforceable; they just have yet to be enforced.
However, even with successful prosecution, bankruptcy proceedings, and nationalization/receivership of offending institutions, we are left with a practical problem: Real currency has been mixed with fake currency, real debt with fake debt. Chains of title and claims to property have been so forged, electronically registered, diced up, and distorted as to make it difficult to sort valid ownership from invalid. When real money has been high-jacked and “disappeared” as with Bernie Madoff, what can be done to address this? These will be points of discussion later in this article series.
4) The mathematics of debt, even without fraud, would require periodic forgiveness or at least abatement. There must be ways for debts to be adjusted to contingencies. Economies, like families, go through good and bad times. Debt obligations are constructed as if there are only good times. Basically, the only way to pay off a debt is to outrun it in a time of relative stability. Even in eras of surplus, debt takes a big bite out productive effort, but it quickly becomes consuming as one gets behind in payments and as more and more of the fruits of effort must go to servicing debt.
At that point, loans become chains that tie people to mediocre jobs and underwater houses and no longer engines of mobile growth. Debt forgiveness recognizes this contingency and facilitates liberty, productivity, and global quality of life as the more salient indicators of vital economies. Policies and contracts ultimately must be in the interests of people’s well-being for them to be legitimate. Conversely, when debt is ring-fenced from contingency as with student loans, it will be become inherently corrupt and unjust.
5) In any rearrangement of the debt system, productivity and stakeholdership should be rewarded and parasitism should be punished. It’s easy to forget that people used to go to a banking agent to get a loan to grow their net financial worth through productive enterprise. In such a relationship the bank gained a stake in your success, not your misfortune. If we are serious about rewarding well-applied effort, then it would make sense to peg debt and debt obligations to the productivity growth curve of an enterprise or domestic product. Lending institutions, then, would essentially buy a longer term stake in the success of enterprises it funds, exert a due diligence proportional to its interest, and both benefit from and share the burden of inevitable rises and falls in growth.
In the housing-bubble debacle the incentives were exactly opposite. Irresponsibility was rewarded precisely because banks could sell off fraudulently documented loans as quickly as they could be signed. In late capitalism, bank support for productivity has been converted into support for exploitation and victimization, using repayment shortfalls to repossess assets from borrowers even though the bank loans were drawn from “money” backed by counterfeit assets. That has to be reversed—real money for real enterprise backed by real assets.
6) Things go down and not always up. “New era” rhetoric where financial gravity is suspended is a dangerous delusion. When we realize this simple fact and combine it with rewarding productivity and stakeholdership, we realize that our revenues and values will fluctuate dependent upon demand, environmental limits, and a host of other factors, some within our control and some not. Fighting this empirical fact, on the other hand, creates damaging and unsustainable living. Why not tie notions of prosperity and economic organization to optimizing our productivity, by identifying and working within the changing conditions, not distorting those conditions by taking on debt-credit to be paid by later generations?
7) The living shall not be beholden to the dead. When an individual person dies with debts, what can be collected from their remaining assets is collected and the rest is written off. Yet the opposite occurs with generational debt. Irresponsible borrowing by past generations is foisted on succeeding generations. The sins of the forefathers are preserved with interest to gouge the quality of life of younger people who neither decided upon nor benefited from irresponsible borrowing.
Certainly, we now see scorched-earth class warfare of the 1% against everyone else, but we are ignoring an even more profound unintended warfare by an entire generation of post-WWII world citizens against the wellness and interests of its own children. How could such a destructive myopia so thoroughly pervade society and bring us this critical historical inflection point? This will be examined in the next part.
* UC DAVIS PEPPER-SPRAY INCIDENT REVEALS WEAKNESS UP TOP
By Matt Taibbi, Rolling Stone
Was absolutely mesmerized last night watching the viral video of the UC-Davis pepper-spraying. It was totally amazing, simultaneously one of most depressing and inspiring things I’ve seen in many years.
To recap for those who haven’t seen it: police in paramilitary gear line up in front of a group of Occupy protesters peacefully assembled on a quad pathway. Completely unprovoked, police decide to douse the whole group of sitting protesters with pepper spray. There is crying and chaos and panic, but the wheezing protesters sit resolutely in place and refuse to move despite the assault.
Finally, in what to me is the most amazing part, the protesters gather together and move forward shouting “Shame On You! Shame On You!” over and over again. You can literally see the painful truth of those words cutting the resolve of the policemen and forcing them backwards.
Glenn Greenwald’s post at Salon says this far better than I can, but there are undeniable conclusions one can draw from this incident. The main thing is that the frenzied dissolution of due process and individual rights that took took place under George Bush’s watch, and continued uncorrected even when supposed liberal constitutional lawyer Barack Obama took office, has now come full circle and become an important element to the newer political controversy involving domestic/financial corruption and economic injustice.
As Glenn points out, when we militarized our society in response to the global terrorist threat, we created a new psychological atmosphere in which the use of force and military technology became a favored method for dealing with dissent of any kind. As Glenn writes:
The U.S. Government — in the name of Terrorism — has aggressively para-militarized the nation’s domestic police forces by lavishing them with countless military-style weapons and other war-like technologies, training them in war-zone military tactics, and generally imposing a war mentality on them. Arming domestic police forces with para-military weaponry will ensure their systematic use even in the absence of a Terrorist attack on U.S. soil… It’s a very small step to go from supporting the abuse of defenseless detainees (including one’s fellow citizens) to supporting the pepper-spraying and tasering of non-violent political protesters. […]
* SCOTT OLSEN, IRAQ VET INJURED BY POLICE AT OCCUPY OAKLAND, INTERVIEWS AFTER RELEASE FROM HOSPITAL
By Brad Friedman, BradBlog
[…] In the video interview, Olsen displays a remarkable memory of the events of the night — particularly given the bloodied, apparent state of shock he was seen in as he was carried off by fellow demonstrators shouting “Medic! Medic!” in video tapes of the incident.
As seen in the interview, he also now has trouble with his speech, thanks to the damage sustained to the left frontal lobe of his brain, according to David Id, who posted the interview on Monday at the East Bay Indy Media website.
Olsen tells Id that his condition has been improving. We’d say remarkably so, given the injury he sustained just over one month ago, which sent him to the hospital in critical condition with a fractured skull and a swelling brain in the early morning hours of October 26th.
His indomitable spirit, evidenced throughout the short interview in which he offers a message to police, politicians and demonstrators alike, is remarkable as well, as he is seen smiling while responding to each of Id’s questions, explaining what he recalls of that night in the moments both before and after he was shot…
“I took a step back and I walked across the right a little bit. I had my phone out. I was texting something to a friend of mine and next thing I know I’m down and on the ground and there are people above me who are trying to help me,” he says.
The responders trying to help him were momentarily waylaid as one of the law enforcement officials hurled an explosive canister amongst them as they were attempting to render aid, in another apparent violation of the Oakland PD Training Bulletin [PDF] created as part of the federal consent decree issued following similarly inappropriate behavior by the department in 2003 and 2005.
“They ended up carrying me away,” Olsen says about his fellow demonstrators. “I didn’t want them to. I wanted to get up and stay there, pick up my bag, but they carried me away.”
“They asked me my name several times and I couldn’t answer them. I couldn’t answer what — I don’t know if I couldn’t recall the answer or if I couldn’t spit it out. But that’s when I knew, yeah, okay, it’s time to go. Time to let them take care of me.”
Olsen’s failure to respond to those carrying him away — as he is seen bleeding from the head with his eyes wide open — is one of the more startling moments of the video taken the night he was shot. [That video, along with his Sunday interview, both follow at the end of this article.]
Asked to explain why he had come to join the demonstration that night, he says he received a call that people were needed in support of Occupy Oakland after the eviction from Oscar Grant Plaza that morning. He says when he was hit he was “standing up for our rights to exist here, with a veteran who was there with me, and all the people who were there. We were attacked and I ended up in the hospital that night.”
His friend was navy veteran Joshua Shepherd who, he says, he met via Iraq Veterans Against the War after moving to the Bay Area. Shepherd is seen in a remarkable piece of video tape, standing without a gas mask amidst rising clouds of CS gas, holding a VeteransforPeace.org flag in one hand and clutching an open copy of the U.S. Constitution in the other, as he stood stone still, staring at the law enforcement agents on the other side of the barricade they’d created at 14th and Broadway that night. […]
READ AND VIDEO @ http://www.bradblog.com/?p=8960
* DEMOCRAT CALLS FOR HEARING ON ‘SECRET’ BANK LOANS FROM THE FEDERAL RESERVE
By Vicki Needham, The Hill
A top House Democrat is calling for a hearing with Federal Reserve Chairman Ben Bernanke following a report that the central bank secretly committed more than $7 trillion to save banks during the financial crisis.
House Oversight and Government Reform Committee ranking member Elijah Cummings (Md.) sent a letter on Monday to panel Chairman Darrell Issa (R-Calif.) requesting the committee look into how banks “benefitted from trillions of dollars in previously undisclosed government loans provided at below-market rates.”
“Many Americans are struggling to understand why banks deserve such preferential treatment while millions of homeowners are being denied assistance and are at increasing risk of foreclosure,” Cummings said.
The request comes on the heels of a Bloomberg report that said the Fed secretly committed more than $7 trillion as of March 2009 to rescuing the nation’s top financial institutions, and that these banks “reaped an estimated $13 billion of income” on the below-market rates.
“Unfortunately, officials from many of these financial institutions declined to comment about these loans, including officials from Goldman Sachs, JPMorgan, Bank of America, Citigroup, and Morgan Stanley,” Cummings writes.
Information about the loans was withheld from Congress as lawmakers debated and passed the Dodd-Frank financial regulatory reform bill and Consumer Protection Act of 2010, Cummings said. Banks also failed to disclose the information to their shareholders.
This “secret financing helped America’s biggest financial firms get bigger and go on to pay employees as much as they did at the height of the housing bubble,” according to economists cited in the report.
* HOW PAULSON GAVE HEDGE FUNDS ADVANCE WORD
By Richard Teitelbaum, Bloomberg
[…] After a perfunctory discussion of the market turmoil, the fund manager says, the discussion turned to Fannie Mae and Freddie Mac. Paulson said he had erred by not punishing Bear Stearns shareholders more severely. The secretary, then 62, went on to describe a possible scenario for placing Fannie and Freddie into “conservatorship” — a government seizure designed to allow the firms to continue operations despite heavy losses in the mortgage markets.
Paulson explained that under this scenario, the common stock of the two government-sponsored enterprises, or GSEs, would be effectively wiped out. So too would the various classes of preferred stock, he said.
The fund manager says he was shocked that Paulson would furnish such specific information — to his mind, leaving little doubt that the Treasury Department would carry out the plan. The managers attending the meeting were thus given a choice opportunity to trade on that information. […]