Nobody Could Ever Have Predicted

Happy sixth anniversary of the collapse of Lehman Brothers, Main Street! As President Obama so blithely assured us last week, America is bouncing back and bouncing forth to fight more manufactured Terror:

Next week marks six years since our economy suffered its worst setback since the Great Depression.  Yet despite these shocks, through the pain we have felt and the grueling work required to bounce back, America is better positioned today to seize the future than any other nation on Earth.

Our technology companies and universities are unmatched.  Our manufacturing and auto industries are thriving.  Energy independence is closer than it’s been in decades.  For all the work that remains, our businesses are in the longest uninterrupted stretch of job creation in our history.  Despite all the divisions and discord within our democracy, I see the grit and determination (TM) and common goodness of the American people every single day –- and that makes me more confident than ever about our country’s future....

 America, our endless blessings bestow an enduring burden.  But as Americans, we welcome our responsibility to lead.  From Europe to Asia, from the far reaches of Africa to war-torn capitals of the Middle East, we stand for freedom, for justice, for dignity.  These are values that have guided our nation since its founding.

Military Keynesianism (stimulating the arms and oil profiteers, a.k.a. "the economy," through endless war) is the only tool left in the tools' box. Or should I say the fools' box. The Best and the Brightest zombies have arisen from the grave, their ivy-covered marble tombstones miraculously untoppled. That is why President Obama remains so confident. Just as the titans of Wall Street paid no price for perpetrating the worst fraud in modern history, the warmongers of the Pentagon and the mainstream media have paid no price for the desecration of Iraq and its environs. Failing upward is the reward given to miscreants in a corrupt world.

Unless, of course, their supreme arrogance and self-confidence become miraculously doomed. I may be wrong, but it looks like despite alleged poll results, more people are against the latest war than are for it. The jingoism isn't quite so jingly this time around. People are noticing that the phrase "moderate Syrian rebel" has an oxymoronic ring to it. This is despite the growth of a deformed third branch of the Democratic Party. There's the pseudo-progressive Warren/Sanders branch, there's the centrist Hillary/Obama Wall Street branch, and now there's the all-inclusive Cheney Branch.

Because, if you're willing to follow Barack Obama, self-proclaimed heir to the unitary executive coup effectuated by Dick Cheney, then you might as well face it: you are a Cheney Democrat. It's a unifying experience, because both Warren Democrats and Hillary Democrats are both cordially invited to join in the exuberant bellicosity. You can be an enemy of the banks or a friend of the banks, but when it comes to embracing death, you are all partying under one big tent. Is there even one anti-war Democrat in Congress these days?

But back to the economy. Paul Krugman, who I thought might have written a column on military Keynesianism again in light of this latest outbreak of war fever, instead marked the sixth anniversary of the economic collapse by blaming the whole debacle on individual ignorance and careerism and giving the Obama administration the usual free pass. (Weaponized Keynesianism only comes in for a Krugman drubbing when the Republicans tout it.)

 In what sense did economics go astray? Hardly anyone predicted the 2008 crisis, but that in itself is arguably excusable in a complicated world. More damning was the widespread conviction among economists that such a crisis couldn’t happen. Underlying this complacency was the dominance of an idealized vision of capitalism, in which individuals are always rational and markets always function perfectly.

Krugman conveniently ignores the continuing corruption, the continuing criminality, and the de facto global fascist coup that has subsumed the world over the past 30 years. This unrestrained coup toppled the global economy six years ago, and threatens to do so again, thanks to toothless and meaningless "reform" passed to placate the masses. But Krugman hilariously blames "capitalist idealists" instead of financial felons. And then there's this:

You might say that this is just human nature, and it’s true that while the most shocking intellectual malfeasance has come from conservative economists, some economists on the left have also seemed more interested in defending their turf and sniping at professional rivals than in getting it right. Still, this bad behavior has come as a shock, especially to those who thought we were having a real conversation.

Krugman is falling into "both sides do it" sophistry again. Just who are these sniping, backbiting "economists on the left" who haven't gotten it right? He does not say. The erection of straw men certainly seems to be a prerequisite for a gig as a New York Times columnist. 

As for his claim that hardly anyone predicted the economic crisis, there is a mountain of evidence that says otherwise. The accurate predictors include Dean Baker, one of those economists on the left. He warned about the housing bubble in 2002 and again in 2004. The Wall Street Economists blog has more on the Cassandras.

Meanwhile, Paul Krugman tepidly concludes, " if we’ve made a hash of things — and we have — the fault lies not in our textbooks, but in ourselves.

My published response:

The fault lies with economists and other "experts" willing to sell out their integrity to the highest bidder. In America as in most of the world, the ultra-rich dictate neoliberal policy. The academic sellouts at think tanks and universities have no choice but to follow the money if they want to keep their ivory tower perches. There are plenty of Rogoffs and Reinharts only too eager to cherry-pick the data, ignore facts, and throw intellectual honesty into their circular files.

Picketty was all the rage for awhile, until the plutocrats panicked and got politicians from both parties to bowdlerize the most extreme wealth inequality in history into the "opportunity gap" and the "achievement gap" and the "personal responsibility gap."

Meanwhile, the Federal Reserve has come out with a largely ignored report showing that by all measures, life for regular people is only getting worse. Without even factoring in the obscene wealth of the Forbes 400, the Fed founded that the wealth share of the top 3 percent rose from 44.8 percent in 1989 (late Reagan years) to 54.4 percent in 2013 (mid-Obama years.) The wealth of the bottom 90 percent fell from 33.2 percent in 1989 to 24.7 percent in 2013. Incomes and home ownership rates fell, while debt, both consumer and student, has risen.

It can be no coincidence that these economic woes are concurrent with skyrocketing incarceration rates, a massive surveillance and police state, and more war.

Jobs, not bombs. Schools, not prisons.

Read the other comments. People realize that the corruption and the stupidity and the militarization are all of a piece. This response from Tim Kane of Mesa, AZ was especially insightful:

You can tell who the bad guys are because they never mention demand side economics. They believe that "supply creates demand" (Hollande - the Socialist President of France) the most absurd thing. Build a buggy-whip factory and see how much demand that supply creates.

I think it can also be said that other problems in the news are related to this. People have too little bargaining power, that means too little wages, which means too little demand, and it then recycles downward.

A huge % of African Americans can't find a way to make a middle class standard of living with just one job. Republicans think "why should they be able to?". Then Ferguson happens.

In the Middle East people are suffering while those tide to Big Oil live in undreamt of comfort. This is all fodder for Jihadist doctrines. And not just in the Middle East, which is why so many people from the west are signing up.

In the 1950s and 60s in the height of the cold war, the issue was which system could give working people a better living: capitalism or communism. In the west they mixed capitalism with socialism creating the mixed economic system (New Deal in the U.S., social democracy elsewhere) resulting in the greatest golden age in history (global GNP doubled in 30 years - ie, grew more in 30 years than the prior 11,000 years since the neolithic revolution).

Somehow, since the end of the cold war, all that's done away with - and the world is falling apart, just as it did after 1929. Economists know this.

Obama's latest terroristic counterinsurgency is not only a war on ISIS. It's a deformed offshoot of the class war. That English-speaking beheader hails from lower-class Britain, which was also rocked by civil disturbances a few years ago, a direct result of the austerity imposed by the global oligarchy. Obama is pissed off because these jihadists have now essentially formed their own oil cartel. The beheadings by disaffected serial killers are only the excuse given to incite vengeance among the sheep. The real cancer of the military-industrial-spy-media complex can continue growing, while the president unilaterally dictates that a relatively minor malignancy, both fed by and feeding the beast, shall be cosmetically nipped and tucked with band-aid bombs.

War under Obama is like another branch of Obamacare: a neoliberal kludge dependent on so many moving parts that it makes "success" impossible. The inclusion of "moderate rebels" will turn out to be just as disposable a notion as the employer mandate. Boots will be put on the ground, but Obama will say they're walking on air. 

It's one more battle between and among wealthy criminal factions. And as usual, the poorer citizens of the world are the ones caught in the crossfire.