Tuesday, May 31, 2011


Last year in the Citizens United decision the Supreme Court ruled that corporations could spend as much as they wanted on political campaigns. Money is their voice, as it were. As long as the contributions went to independent groups, and ads were run by third parties (and not to the candidates themselves) corporations were free to drop as much money as they wanted to voice their political opinion during a political campaign.

Well, now, according to a U.S. District Court decision corporations can spend as much as they want on individual candidates because corporations enjoy the same rights as individual citizens. Put another way, corporations are people too. Only they are richer and enjoy the fact that politicians dependent on them for their political lives.

What the judges in our country who make these rulings don't seem to understand is that foreign owned corporations are also empowered to voice their opinion in our political process too.

While there are several sites that explain the long history behind corporate personhood, the fact is establishing corporate personhood is really a product of a damn typo. Seriously. I have commented on the long and less than distinguished road to corporate personhood here, here and here.

At the end of the day, our emerging reality is that corporations can now dominate the political process in America - more so than they did in the past.

If we have to live with this corporate personhood nonsense, then I'm with Rep. Kucinish (D-OH), and have one request: If corporations are endowed with the same rights and privileges as U.S. citizens, and are considered people in the eyes of the law, then I want to see a birth certificate ... long form too.

At what point do we realize that corporations aren't the same as people? They are legal concepts that have have been granted life and significant protections by the state. They were created to serve the state, not the other way around.

Surrendering our sovereignty and our individual rights to a private legal abstract is nuts.
- Mark

Addendum: Artwork from Keith Tucker at "What Now!" Toons.

Thursday, May 26, 2011


With Memorial Day around the corner, Sen. Robert Menendez (D-NJ) introduced a bill today that would allow the immigrant parents, spouses and children of active duty military service members to gain legal status. The idea is that no soldier should fight for our country and then have to worry that their family will be deported.

With no Republicans signing up to support the bill the GOP is demonstrating, once again, that their support for families in general, and military families in specific, is really political theater. Menendez' bill is especially pertinent in light of MSNBC's recent Lean Forward ad campaign ...

The idea that a U.S. soldier can fight and die for America ...

... and then have their family deported after the fact is unconscionable.

- Mark


From time to time I run across articles that are worth posting in their entirety. This article on the International Monetary Fund (IMF) from Money Morning's Martin Hutchinson is one of them. In very succint and clear terms Hutchinson explains what the IMF does, and why it is no longer the institution that it's post-war architects (Dexter White and John Maynard Keynes) had in mind. In my view what Hutchinson's explaining is how the IMF has become a victim of "mission creep" and is currently little more than a subsidy providing institution that works as much for Wall Street as it does for the countries it bails out. The photos are added.

Ebenezer Scrooge: The Ideal IMF Successor
By Martin Hutchinson, Contributing Editor, Money Morning

Dominique Strauss-Kahn's forced resignation from the International Monetary Fund - and the search for an IMF successor - is a blessing in disguise. Strauss-Kahn's term in office saw a vast expansion of the IMF's activities, a fact often used to praise his tenure.

But a close examination yields a very different picture. Under Strauss-Kahn, who took over as the IMF managing director in September 2007, nearly every intervention has resulted in failure: The IMF allocated capital to places it shouldn't have allocated capital to, and propped up governments that shouldn't have been propped up.

The ideal IMF successor to Strauss-Kahn would be Ebenezer Scrooge - as a prelude to closing the institution down altogether.

That's because the IMF is a waste of money ... your money.

To understand why, let's take a look at what the IMF is, and see how it works.

IMF Insights
The IMF is an international financial institution that's based in the U.S. capital. It operates a bit like a credit union, but on a global scale. Like a credit union, the IMF's member countries - all 187 of them - provide the funding. And the IMF board then lends that money out.

Each member country has a financial stake in the IMF - a funding "quota" that's expressed as a percentage - and contributes accordingly. Because the United States is the single-biggest stakeholder in the IMF, it also has the single biggest quota (17.75%).

The United States is followed by Japan (6.58%), Germany (6.14%), and then France and the United Kingdom (at 4.52% each).

But that doesn't necessarily mean that this country (meaning U.S. taxpayers) is responsible for 17.75% of the money the IMF doles out as its share of the global bailout packages that have been issued during the past few years.

Indeed, the U.S. stake is actually higher. That's because some IMF-member countries have currencies that potential borrowers just cannot use. The IMF refers to this as "non-usable resources." As of January 2010, about 21% of the IMF quota contributions fell into this category.

Because the United States, Japan and their European counterparts have "usable" currencies, the IMF relies on them for funding contributions that are actually greater than their official quota.

And that means the burden on U.S. taxpayers is higher than most realize.

There are exceptional cases where the IMF has done some good. A $2.3 billion loan to Latvia in December 2008 was only partly drawn, and helped Latvia to survive the savage deflation needed to maintain its currency peg against the European euro.

Having downsized its government and reduced wage rates, Latvia's current account is now in balance, and its budget deficit for 2011 is projected to fall below 6% of gross domestic product (GDP), according to projections by The Economist. Best of all, Latvia's economy is growing again: It advanced at a healthy 3.6% clip in 2010.

In this case, the Latvian government did most of the hard work. And the Latvian people suffered most of the pain. Even so, this is one situation where IMF intervention was clearly helpful, albeit in a modest way.

But victories like the one in Latvia have been more the exception than the rule. And that's something the IMF successor needs to address.

Larger programs without energetic local government support have been more problematic. In Ukraine, for instance, the IMF dragged its feet on lending to the pro-Western Yulia Tymoshenko government. Then, after Tymoshenko lost the January 2010 election, it released further resources to the anti-market Viktor Yanukovych government, which has allied the country firmly with the nastier elements in Russia's Medvedev/Putin regime.

A total of $14 billion of IMF money is currently outstanding here. Any economic - and, indeed, political - "reforms" have gone in the wrong direction.

By far, the IMF's largest current commitment is the huge sum of about $40 billion to Greece - of which just over $20 billion is outstanding [Editor's Note: Make sure to check out a related story on the Greek debt crisis that appears elsewhere in today's edition of Money Morning.]

This commitment of around 13% of Greek GDP is not an attempt to help poor folks, since Greece's per-capita is more than $30,000 - far in excess of most East European economies.

But what it did accomplish was to prolong an entirely untenable situation.

Since Greece joined the European Union in 1981, decades of EU subsidies - many of them obtained through fraud - have raised the country's standard of living far above its production. Very early retirement and extremely poor tax collection indicate that the desire to pay reasonable taxes to support the state isn't overwhelming in Greece. Instead, more than a little of the financial burden, over time, has been shifted to international banks, German taxpayers and other deep-pocketed patrons.

There's also the fact that consumption is lavish while exports are almost nonexistent, meaning that even in this deep recession Greece is running a current-account deficit of around 10% of GDP.

If Greece ends up defaulting - as now seems overwhelmingly likely - the IMF will be repaid 100 cents on the dollar, because it is by international agreement ranked senior to commercial debt. That means the IMF loans, by enabling Greece to spend an additional year or more squandering its resources, will have greatly reduced the likely payout to the country's private creditors.

Thus, the IMF has not even taken risks with its own capital, but has extracted its subsidies from the unfortunate shareholders of major international banks foolish enough to lend to the country.

There is plenty of blame to go around.

Greece's 2001 entry into the Eurozone was facilitated by a Goldman Sachs Group Inc. (NYSE: GS) scam that allowed the country to report phony deficit figures. However, the IMF's $40 billion has merely prolonged the Greek rave-up and stiffed bank shareholders, without producing any possibility of genuine reform or long-term stability.

As the above figures suggest, far more of the IMF's money goes to the Greeces and Ukraines of this world, than to the more-deserving Latvias.

By subsidizing the world's most profligate and unproductive countries - and doing so by extracting the money for financing from the hard-working taxpayers of Germany, Japan and the United States - the IMF is damaging world growth and preventing Schumpeterian "creative destruction" from happening as fast as it should.

Scrooge for IMF Successor
In principle, the world would be very much better off without the IMF. Indeed, freed from that financial drain, development finance could be properly carried out by the private sector - by skilled merchant-bank practitioners - as was the case before 1914.

But if we must have an IMF, at least let us have an IMF that does not pour money down ratholes. The closer the new chief is in spirit to Ebenezer Scrooge, the better.

By all means, let the IMF successor to Strauss-Kahn be someone from the emerging markets (all the IMF managing directors have hailed from Europe). But if that's the route we're going to travel, may he or she come from a well-run emerging market - such as Singapore - where they understand the value of a buck and won't listen to soppy hard-luck stories from leftist corruptocrats.

For investors, there is not much to be done - other than avoiding the shares of the major international banks, which will undoubtedly be presented with much of the bill for this useless institution's activities. That bill will ultimately find its way to us - the put-upon U.S. taxpayer.

Exactly 12 months ago, not long after an IMF bailout for Greece was first proposed, then-U.S. Rep. Todd Tiahrt, a Kansas Republican, urged the United States to oppose participation in the package. His statement is worth a look.

Said Tiahrt: "It is simply unfair-as a matter of principle-to force American taxpayers to use their hard-earned money to prop up failed policies in relatively wealthy nations."

We're with him.

I couldn't have said it better myself ...

- Mark

Wednesday, May 25, 2011


Nine years ago I wrote an op-ed on Middle East tensions for our local paper, the Bakersfield Californian. Most of the article covered basic historical information. At the end of that article I wrote that for Israel to avoid another century "drenched in blood" - as King Saud predicted would happen - that accepting pre-1967 borders, "or adjusting those borders," so that the Palestinians can have a state that they call their own, was the key to building a foundation for peace in the region.

If this were to happen, I wrote, there would be a reason for the Arab world to begin cooperating on the issue of Israeli security. This is why I was so impressed with President Obama's Middle East speech last week.

Specifically, President Obama said:
"We believe the borders of Israel and Palestine should be based on the 1967 lines with mutually agreed swaps, so that secure and recognized borders are established for both states."
And just like that President Obama initiated a discussion that those of us who follow the region understand needs to take place if we are to secure a modicum of peace in the region.

Perhaps more importantly, with Osama Bin Laden dead, we are currently witnessing the consolidation of the Obama Doctrine - Peace through cooperation, Order through strength - in real time. By pushing the Israelis to see how their future security is tied to building bridges with the Arab world - no matter how reluctant they may seem at the moment - President Obama is demonstrating that he isn't interested in pushing empty and unrealistic "Road Map to Peace" agendas.

And by taking Bin Laden out earlier this month, President Obama has made it clear that he's ready to take risks, which includes his willingness to put the future of his presidency behind his agenda for the region.

This is serious stuff, and the major players involved know it.

Better yet, what President Obama is doing is slowly leaving his domestic enemies (mostly in the GOP) and regional critics with little more than petty sound bytes.

With Prime Minister Netanyahu supporting President Obama's proposal for mutually agreed land swaps, the professional naysayers and the GOP may soon find themselves left with little more than empty rhetoric and petty grandstanding media ops to hang their hats on - as this Lawrence O'Donnell clip makes clear ...

We are currently watching history being made in real time. And the fact that the GOP doesn't see or understand what's happening is just one more reason why President Obama will be reelected in 2012.

- Mark

UPDATE (11-21-12): If you want to read an excellent book on the Obama Doctrine take a look at David E. Sanger's Confront and Conceal: Obama's Secret Wars and Surprising Use of American Power (Random House, 2012). It provides a detailed look at the Obama Doctrine by outlining the president's use of coalitions when broader U.S. global interests are evident (like the intervention in Libya) and aggressive unilateralism when specific U.S. security interests are involved (the drone attacks and the killing of Osama Bin Laden). For a quick but still nuanced review of the Obama Doctrine check out Joseph S. Nye's article, "The Obama Doctrine's First Term." And, of course, there's my earlier blogpost on the Obama Doctrine as it was being defined in 2009.


Last weekend, for his birthday, I took my son and some of his friends to San Francisco to watch the Giants play the A's. Apart from the fact that the ball park is perhaps the best baseball-watching stadium in the country (the setting in the outfield is more like a plaza than a stadium), at the end of the game the Giants played "I left my Heart in San Francisco" by Tony Bennet ...

I had forgotten how much I liked the song, and stopped my son before we left so we could listen. Definitely going back.

- Mark

Tuesday, May 24, 2011


In my book I wrote about dead peasant insurance. It worked something like this. Companies would take out insurance policies on their employees. Those on the lowest rung of the totem pole would be offered a $10-25,000 insurance policy when they were hired. When they died their family would collect the money.

This is where it gets interesting.

What the companies didn't tell their employees is that when they took out policies the policies actually paid out anywhere from $100-300,000, and some times more. But the family members still only received $10-25,000. The companies could do this because of favorable legislation that gave them tax credits (as a business expense) to purchase the insurance policies.

This means that the American taxpayer you and me actually paid for the insurance policies. But the company collected when the "dead peasant" insurance policy paid off.

Nice, huh?

Anyways, we're now seeing the evolution of another death based financial contract. It turns out that Goldman Sachs and the usual suspects on Wall Street want to peddle insurance contracts to pension "investors."

Sound good so far? Not really. Here's why.

Because people are living longer, each additional year of life expectancy adds as much as 4% to future pension requirements. This cuts into profits. Longevity cuts into the bottom line. However, by providing insurance to pensions and other retirement institutions Goldman Sachs hopes to convince the pension groups that they are dumping the expense of each additional life year onto insurance providers.

But here's the catch.

The "insurance" providers are not categorized as insurance companies. As a result the pension insurance system isn't regulated like regular (car, home, etc.) insurance companies. These insurance providers don't have to have the reserves on hand to pay out if something really goes wrong (you know, like in 2008).

Instead, these market players are considered as part of our unregulated derivative and/or "swap" market. Call it the "death derivative" market. But, at the end of the day, they don't legally need to have the money to pay out claims. To be sure, they can collect premiums, and can suck the financial life out of their customers. But, like the economic zombies they're sure to become when the going gets rough, they're not legally obligated to give anything back.
So, instead of selling insurance Goldman Sachs and other banks are really selling "death derivatives" - which are contracts that derive their value from an underlying asset, and can be bought and sold to others with few if any oversight (similar to an earlier class of "death securities" I wrote about over a year ago).  

In plain language what this means is that if the insurance providers collecting premiums today go belly up tomorrow because more people suddenly die, many pensions who think they have insurance will find themselves facing a shortfall, big time.

Goldman Sachs, and their band of snake oil salesmen, are saying "Don't worry ... private market players know what they're doing ... and besides, insurance companies don't go bust." Huh?

Incredibly, these guys have already forgotten and moved past Lehman Bros. and A.I.G. And why not? They got their money.

We should know better. The motive here isn't insurance. It's revenue. These guys need to be regulated. But they won't be.

It's de javu all over again.

- Mark

Monday, May 23, 2011


So the world didn't come to an end on Saturday. No Rapture-like body disappearances. No Apocalyptic ending. Not even space aliens. Nada. Zilch (though I did have a good time at the game on Saturday).

However, this is what happens when people take the charlatans seriously.

Too bad. People need to remember what the Bible says about predicting the end of time. December 2012 could be an unnecessary nightmare for many. Sigh ...

- Mark

UPDATE: Harold Camping has rescheduled the Rapture for Oct. 21, 2011. Halloween time. Pretty spooky, wouldn't you say? But rather than a long torturous road, the end "will come at once."

Friday, May 20, 2011

TENNESSEE IS SO GAY ... (and why I'm going to teach Intelligent Revolution)

So the state of Tennessee is prepared to have their school children challenge the Theory of Evolution so they can discuss the merits of Intelligent Design. Presumably this might include how Jesus helped domesticate the dinoasurs ...

But, in Tennessee's public schools, it may not be OK to say anything or discuss the challenges and realities of American citizens who are part of our gay community ...

And the South wonders why the rest of America often views them as out of touch hillbillies. The way they do business has a way of making people think that they view the Flinstones as a documentary ...

While believing that the dinosaurs made it for the trip on Noah's Ark, the reality is that it would have probably ended something like this ...

Yeah, yeah ... I know.

Anyways, in the spirit of the South, I have an idea. The next time I teach American Politics I'm going to start off the American Experience by teaching Intelligent Revolution ...
Think about it. How else can we explain American revolutionaries beating the British against all odds? They must have had some divine help from the Spirit. Now if we can just find Washington's dinosaur saddle ...

- Mark  

THE END IS NEAR ... (so we're told)

The world's coming to an end tomorrow. This is what apocalypse predictor, and religious provocateur, Harold Camping is saying. Why in the world anyone pays any attention to this guy is beyond me. Still, as I thought about his prediction (and his previous end of times prediction), I began to think about the other prophesies of doom.

The Bible's punishing Book of Revelations prediction has captured the imagination of Christians through the millennium. We have the Mayans and their December 21, 2012 "end of the calendars" solar-pole shifting event (which is backed by science). Edgar Cayce, the slumbering oracle of Indiana, chimed in with his quake predictions as well. Then there are the Nostradamus quatrains, and the Web Bot's "data gap" that begins in 2012 and restarts May 2013.

At the end of the day, one thing is clear. We've had numerous gloomy end of times predictions from diverse sources throughout the millennium. The prediction for tomorrow's global flame out falls right into that category.

But I'm still going to take my son to the Giants game tomorrow. Here's why.

What we need to remember is that throughout history we've been told that the end is near. We've also been told that Napoleon was the anti-Christ. Then it was Hitler. Then it was Bin Laden. Tomorrow we'll find another, I'm sure. The point is human nature is such that many are predisposed to embrace the worst predictions because, as we've seen throughout time, they don't know any better. So, as a species, we buy into myths, predictions, and superstitions. They help explain, and provide a sense of control.

Indeed, at one time many believed that anyone who fell to the ground - in what we now know is an epileptic fit - was possessed by the devil. Why? Because that's all we knew at the time. But - and here's the  key - we allowed ourselves to believe this. Floods and famine? The gods must be mad at us. The Plague? God was really pissed off then. And we believed it all.

Incredibly, the Enlightenment, the scientific method, and the modern world really haven't made things any better.

Think about it. Science and technology have evolved to such a degree that we have elaborate communication tools that allow us to keep tabs on the rest of the world. So we see more devastation and calamities. And, as products of the Enlightenment, we should be able to evaluate their developments rationally. But instead of saying, "Wow, isn't it incredible that we can see more of what's happening in the world ..." we have people who want us to believe "the end of times is near because more catastrophes are evidence of God's wrath ..."

Just because you see and hear about more quakes and devastation doesn't mean there are more quakes and devastation then we've had in the past. It only means that modern technology and media networks allow us to have more information about global events. We should be studying these events, and preparing for them. Instead, we fear them and have invented elaborate stories to explain them.

Look, whether you want to believe in the calculations of the Mayans (which do have a basis in science), the punishing judgment days foretold in the Bible (or the prophecies of St. Malachy), the dreams of  Edgar Cayce, or the mystical writings of Nostradamus, we need to keep one thing in mind: If you believe that the future of our world is guided by a divine hand, or cyclically determined, then what happens to our world tomorrow is beyond your control.

What is in your hands is what you do with your life, and how you treat those around you. Me? I'm going to the game tomorrow.

- Mark

UPDATE (12/20/12): For those wondering why the Mayan calendar ends so suddenly ...

UPDATE TO MY UPDATE (12/20/12): This piece from The Economist is interesting too ...

Wednesday, May 18, 2011


In the "I told you so" department ...

Last month I posted on the "Ten Myths About Our Budget Mess (And Why the GOP Isn't Serious About Solving It)". In a few words I wrote that rather than pursuing a balanced approach, and going after wasteful corporate subsidies, write-offs, deductions and other unnecessary corporate welfare giveaways, that the Republicans simply wants to cut programs they don't like. Their budget priorities have nothing to do with saving money as much as it does with forcing their failed ideology down America's collective throat.

A political force-feeding, as it were ...

I wrote that it doesn't matter that we can find at least $1 trillion in savings by going after unnecessary tax breaks, subsidies, and deductions, the GOP simply is not serious about fixing our budget mess. Period.

Well, guess what? With a $1.5 trillion budget deficit staring us in the face the GOP voted yesterday to keep and extend billions in tax breaks for America's biggest oil companies - even though they're making record profits, and don't need them. 

Think about this the next time the GOP says they're serious about the deficit.

- Mark


Once again, Jon Stewart shows how foolish and petty Fox News is ...

These guys are pathetic and poisonous. I won't comment on the racial undertones behind the Fox commentary. Sean Hannity, especially, looks like a complete tool.

- Mark


Are you tired of the thirty year lie that tax cuts will solve all our problems, only to see budget deficits surge while public services are starved for cash?

Are you tired of seeing corporations get big subsidized handouts, exemptions, and write-offs to create jobs, only to see them eliminate 2.9 million jobs in the U.S. while creating 2.4 million abroad?

Are you tired of watching the rich get richer as your debt load increases, and your economic situation deteriorates?

Are you tired of being fed "free market" myths only to see corporate lobbyists and the global rich work to transfer trillions of dollars in current and future wealth to a small group of beneficiaries?

If you answered yes to all of these questions then check out the site for the Robin Hood Tax. Like Millionaires for Fiscal Strength, this group is supported by thoughtful leaders and ordinary people from around the world.

The Robin Hood Tax site is for anyone - and not just millionaires - who believe it's time to rewrite the social contract between the banks, Wall Street, and society.

- Mark

Friday, May 13, 2011


This is Labor Relations 101 (or should be). From Huffington Post, this story on confiscated gratuities is simply incredible. Seriously, who keeps tips and then tells their servers they can't let the paying customers know who's actually getting the tip? It kinds of reminds me of this guy ...

As a former waiter, bartender, busboy, and general supporter of working folk I hope the servers win their case, and then get damages too.

- Mark


In the FYI category, this is what's really behind the Birthers and the party of "Your papers, please" ...

- Mark

Thursday, May 12, 2011


None of the information here is new. But "Immigrants for Sale" is perhaps the best brief review of what's helping to drive our immigration debate, from the dark side ...

This clip also helps us understand what's wrong with "privatizing" our prison system. The political and private incentives here are all wrong.

- Mark

Tuesday, May 10, 2011


If you want to know why the economy is still in trouble check out these two pieces on corporate crime and our 30 year-long "wage" recession from Harvard economist Jeffrey Sachs and former Labor Secretary Robert Reich.

First up, we have Sachs' "Corporate Crime Wave" piece.

In very simple terms Sachs makes it clear that corporate crime pays. And it especially pays if you earn a living as a top executive in one of the largest firms around the world. And why does corporate crime pay? Two reasons.

* Big companies are now multinational, while governments remain national. Big companies are so financially powerful that governments are afraid to take them on.

* Big companies are major funders of political campaigns in places like the U.S., while politicians themselves are often part owners, or at least the silent beneficiaries of corporate profits.

Sachs is spot on here. Conceptually, the challenge of managing multinationals is easy to understand. There's historical precedent. At the beginning of the 20th century corporate America had become so powerful that individual states were largely powerless to take on the Carnegies, Morgans, and Rockefellers of the world. It took market collapses, entrenched corruption, and genuine public outrage to motivate a political movement.

But it also took the genius of Teddy Roosevelt at the national level to challenge the "trusts" and monopoly practices of corporate America.

But even the efforts of Teddy Roosevelt weren't enough. A string of laissez-faire, let-the-market-do-what-it-wants, American presidents in the 1920s allowed corporate America to have it's way with the economy and the American public. We all know what happened with the triumph of conservative Republicanism in the 1920s ...

Sachs also discussess how problems are made worse by the international financial structure. In his view the international financial structure is propped up and supported by institutions that lack genuine oversight authority.

This has created an environment that allows tax havens, winks at secretive Swiss banks, encourages global tax evasion, accepts global kickbacks, nods at illegal payments, turns it's back on bribes, and pretty much ignores other illegal transactions - as long as it's done by and for large multinationals (drug lords, money launderers, and weapon runners really need to work on getting their trade legalized).

According to Sachs, the "wealth, power, and illegality enabled by this 'hidden' system are now so vast as to threaten the global economy's legitimacy." (Sachs doesn't touch what William K. Black referred to as "control fraud" at the domestic level. Anyways ...)

With no global institutions dedicated to advancing and protecting the interests of people like you and me in this giant parlor game, the losers in this market game are the rights of labor and, ultimately, the American consumer. This brings us to Robert Reich's piece on the wage and jobs recession we're now experiencing.

Reich's argument is a simple one: Because wages have stagnated and even fallen backwards, while record profits and bonuses continue, the American economy is bifurcated and in trouble. And it's getting worse.

One of the reasons wages have stagnated is because corporate America has been sending jobs overseas (aided by very favorable legislation). This dynamic cuts into the wages and salaries of workers who see jobs disappear, and must now compete with more unemployed laborers here, and millions of workers willing to work in sweat shop conditions in the developing world.

How bad has it gotten? Consider the following: The Commerce Department recently reported that over the past decade, American multinationals (essentially all large American corporations) eliminated 2.9 million American jobs while adding 2.4 million abroad. If you're looking for specific examples check this out:

* In 2000, 30% of General Electric's business was overseas, along with 46% of its employees. Today, 60% of its business is outside the United States, as are 54% of its employees.

* Over the past five years, Oracle added twice as many workers overseas as in this country; 63% of its employees now work abroad.

The incredible thing is that workers wages in America have been collapsing at precisely the same time that productivity has been going through the roof.

What should be happening in this scenario - according to economic history and the "laws of justice" Adam Smith spoke about - is that the workers should be sharing in the productivity gains made by industry. Wages in America should be going up. Consumption should be stable, or going up. A real recovery should be happening. But this is not the case. 

Part of the reason for this, as Sachs points out, can be attributed to the power and influence corporations wield around the world. In addition to securing a steady stream of bailout money, they're able to move money and jobs out of the United States, in the process depriving the American economy and its workforce of the resources they need to recover. The incredible thing is that corporations no longer need to rely on the Pinkertons and Baldwin-Felts of the past to intimidate and cow labor.

They simply go to their muscle in the lobbying halls of Washington DC. The blackjacks used by the Pinkertons have been replaced by briefcases of lobbyists in Washington.

There's more. Much more. But one thing is clear. Don't expect the American consumer to lead the recovery. They are buried under a barrage of bad news, collapsing wages, and favorable legislation for corporate America. And, as I pointed out in my book (and 7 months before the market collapsed in 2008), the American consumer is simply tapped out.

- Mark


At CSU, Bakersfield tonight ...

For those of you who live in the Bakersfield region, California State University, Bakersfield will be hosting a panel discussion titled "Death of Bin Laden: What Now?" tonight at 5:30 pm.

I will be joined on the panel with Dr. Steve Campagna-Pinto from Religious Studies, Dr. Reem Abu-Lughod from Criminal Justice, Dr. Debra Jackson from Philosophy, and my colleague from Political Science, Dr. Gitika Commuri.

For additional information call, 661-654-2141.

- Mark

Monday, May 9, 2011


Why isn't this a surprise ...

In yet another demonstration of ego overcoming common sense, serial cheater and former Speaker of the House, Newt Gingrich (R-GA), is expected to anounce his candidacy for President of the United States this week.

With super geniuses like Sarah Palin and Donald Trump polling ahead of Newt, there's little doubt that the 67 year old Gingrich is clearly looking for attention (or another wife). Apart from the hypocrisy vote (recall, Gingrich went after President Clinton while Gingrich was cheating on his second wife; who he used to cheat on his first wife), expect Gingrich's base of support to come from these characters ...

Expect Newt to make a lot of noise, then to flame out.

But don't be surprised if Gingrich finds wife number four during the campaign. Politics seems to make him more attractive to females in the Republican party.

- Mark

Friday, May 6, 2011


About eight months ago - in "Corporate America's Blame Game" - I discussed how our financial services sector is busy suing each other because no one wants to accept responsibility, for anything. Well, guess what? The finger pointing in corporate America continues.

First up, we're learning that Deutsche Bank has shoved at least a billion dollars in toxic loans on to the books of the U.S. government, in the process shifting responsibility and blame on to the government for bad loans that they originated (their argument works like this, "If the government insured it, it's their fault").

Then we hear about our taxpayer bailed out banks illegally evicting military families from their homes, in the process claiming that they were both a "painful aberration" and an oversight in bank practices - ignoring how the industry created the "aberration" environment by deliberately overworking and taking shortcuts on hiring people to properly assess troubled borrowers' home loans (earning $20 billion in savings in the process).

Now we see the banks raking in billions of dollars acting as bad neighbors and slumlords because of their claim that they aren't legally responsible for maintaining their properties, in the process shoving the responsibility on to hard-to-prosecute servicers of their loans.

Making matters worse, is that all of these taxpayer bailed out parasites are hiding behind lobbyist-driven negotiations, and taxpayer funded legal infrastructures to avoid responsibility for their questionable activities.

At the end of the day we end up with one simple truth: The banks are not responsible for anything.

And the big banks wonder why America has lost faith in corporate America and in the financial services sector (only 25% of Americans trust the banks to do the right thing, a drop of 46% points).

Simply put, the banks are demonstrating that they have no sense of responsibility, shame, or irony.

They just have our money.

- Mark