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OpEdNews Op Eds    H2'ed 6/13/12

Economic Reform Newsletter: Are we lurching towards a one-world government?

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Hello Fellow Economic Reformers:

Welcome to the new recipients of this newsletter!  Some of you signed up for a followup at the recent Earth Days and Left Forum events and I will have a more personal outreach for you next month.  Meanwhile, old and new readers of this irregular newsletter - now numbering 904 recipients - I hope you will find this addition useful and helpful.  As always, let me know if you wish to be removed from the list.

Local News for the Local Chapter
We had a productive, albeit business-like, meeting of Georgist reform group Common Ground-NYC a few weeks ago, covering the recent elections, activities, finances, future plans, etc.  I'm happy to announce that the current administration has been re-elected for another year by 19 out of 21 votes, with 2 abstaining; that's me as president and Rita Rowan as Treasurer. 

Most of the recipients of this newsletter are interested in larger economic issues, however, so I'll move on.  Those who are interested in more details about our local NYC group can join the Economic Reform group and read Common Ground-NYC Docs here:

Lurching Towards a One World Government?

How does Fascism start?  It certainly doesn't happen because people think they could do a little better with some other less democratic system.  It happens because the confused and desperate masses are looking for a solution to their socio-economic problems.  Perhaps they latch onto a charismatic leader like Hitler, but this may not be necessary.  It can grow out of Corporate Fascism: click here, which originally developed under Benito Mussolini.  From Wiki:
Italian Fascism involved a corporatist political system in which economy was collectively managed by employers, workers and state officials by formal mechanisms at the national level. [ 33 ] This non-elected form of state officializing of every interest into the state was professed to reduce the marginalization of singular interests (as would allegedly happen by the unilateral end condition inherent in the democratic voting process). Corporatism would instead better recognize or 'incorporate' every divergent interest into the state organically, according to its supporters, thus being the inspiration for their use of the term totalitarian, perceivable to them as not meaning a coercive system but described distinctly as without coercion in the 1932 Doctrine of Fascism as thus:
When brought within the orbit of the State, Fascism recognizes the real needs which gave rise to socialism and trade unionism, giving them due weight in the guild or corporative system in which divergent interests are coordinated and harmonized in the unity of the State. [ 34 ]
[The state] is not simply a mechanism which limits the sphere of the supposed liberties of the individual... Neither has the Fascist conception of authority anything in common with that of a police ridden State... Far from crushing the individual, the Fascist State multiplies his energies, just as in a regiment a soldier is not diminished but multiplied by the number of his fellow soldiers. [ 34 ]
Fascism then, was at the time, full of optimism towards the future.  Too few saw the dark clouds of the coming nightmare.  Does this apply again today?
Are the problems in Europe enough to tilt the sub-continent back towards a fascist one-region government?  Consider a recent Reuters article (click here):
After falling short with her "fiscal compact" on budget discipline, German Chancellor Angela Merkel is pressing for much more ambitious measures, including a central authority to manage euro area finances, and major new powers for the European Commission, European Parliament and European Court of Justice.
She is also seeking a coordinated European approach to reforming labour markets, social security systems and tax policies, German officials say.
Until states agree to these steps and the unprecedented loss of sovereignty they involve, the officials say Berlin will refuse to consider other initiatives like joint euro zone bonds or a "banking union" with cross-border
deposit guarantees - steps Berlin says could only come in a second wave.
Note this is not just about "Monetary Union" anymore, whatever that truly means.  The "Final Solution" now includes a "European Parliament and European Court of Justice" according to German(!) officials.  Merkel is seeking sweeping "reforms" (read: cuts for everyone but the German banks).  Ironically, but happily, German voters are starting to turn against her in regional elections, not because they don't believe in austerity, at least for their neighbors, anymore, but because they don't believe in bailouts for them.  This may prove her undoing, and the undoing of the one world government movement and back towards a decentralization of power and even regained Monetary Sovereignty, and unraveling of the Euro.  Convenient as a single currency may be, with common fiscal and political powers, it can't work.  And with that, absent democratic control, there will be a top-down dictatorship, led primarily by the Money Power, for which the European Union was set up in the first place.  Europe's people may have sought union as a way to end a history of world wars, but what they're getting is an oligarchy that will financially, and increasingly, legally , enslave them.  It is no coincidence that the strongest players in this come from Germany...again.  Perhaps decentralization needs to get down to another level.  Perhaps people need...

Alternate Money?

The world economy continues to fall apart.  The recent American job creation number - 69,000 - was so abysmal, I was driven to write another article (OK, stop laughing now ): 

Today's payroll number -- 69,000 -- was one of the worst since the depths of the economic crisis in late 2008-early 2009.   The official unemployment rate ticked up to 8.2%, but the rate, as measured the way it was before all the gimmicks of the 1990s and 2000s undercounted or excluded the long-term un/underemployed, is at least twice that.   Nationally, the inflation-adjusted wages of the bottom 80% of the country haven't seen a rise in nearly 2 generations.   Inflation figures too, have been purposely rigged to undercount inflation.   Says economist John Williams of
May 15, 2012
Consumer Price Index Has Been Reconfigured Since Early-1980s So As to Understate Inflation versus Common Experience
- CPI no longer measures the cost of maintaining a constant standard of living.
- CPI no longer measures full inflation for out-of-pocket expenditure.
- With the misused cover of academic theory, politicians forced significant underreporting of official inflation, so as to cut annual cost-of-living adjustments to Social Security, etc.
- Use of the CPI to adjust retirement benefits, private income or to set investment goals impairs the ability of retirees, income earners and investors to stay ahead of inflation.
- Understated inflation used in estimating inflation-adjusted growth has created the illusion of recovery in reported GDP.
Meanwhile, according to Professor L. Randall Wray Professor of Economics and Research Director of the Center for Full Employment and Price Stability, University of Missouri--Kansas City, in widely published series of articles, including one in the Huffington Post, the Fed has loaned, guaranteed or otherwise made available, cumulatively, some $29 Trillion!   Has this largesse towards the financial sector made us better off?   At best, the Fed rescued the banks that were directly instrumental in causing the crisis, and boosted stock prices - for now.   At best, the government stimulus stalled the economic slide into oblivion - for now.

We are so used to hearing "there are no easy solutions" that many people think there are no solutions at all.   This is Big Lie #1.   Big Lie #2 is that we are broke and There Is No Alternative (TINA -- thanks, Margaret Thatcher, for that false belief) to Austerity.   We can throw Austerity as a cure for the economic crisis on the dust heap of failed theories, says Paul Krugman and, increasingly, other economists, mainstream and not.   I have been lamb-basing the new Austerians (a term I coined even before Krugman) for months.   Greece will probably throw the Austerians out of office later this month as well, German Chancellor Angela Merkel is rapidly losing support, even in her homeland, as recent regional elections have turned against her.   She is becoming increasingly isolated internationally, with her ally in France, Sarkozy, now booted out by socialist(!) Francois Hollande who wants more stimulus (good), but has no idea how to pay for it (bad).
Meanwhile, Europe's up-and-coming basket case, Spain, has an unemployment rate of just under 25% and a youth unemployment rate double that -- perfect "stimulus" for protests on a daily basis.   How long until the police -- the last line of the 1%'s defense, simply switch sides, as they did in Egypt and much of the Middle East, and support those who they beat up previously?   This is how revolutions succeed, a fact that has been overlooked by both the Right and the Left, who just assume that mass protests will eventually get them what they want.   No, all successful revolutions end with the police or military coming out in support of those who want change -- though that does not necessarily, or usually, mean success in the long run.  

I'm still waiting to see if the pen is mightier than the sword, but here's the rest of the article on Op Ed News:
and here on Huffington Post:
The Instant Solution to the New Depression: Debt-free Money
click here

Victoria Grant is Getting it Done

12-year old Victoria Grant's 7-minute viral video on Public Banking and Public Money, re-filmed at the Public Banking Institute Conference in April, has now hit a combined total form all sources of over 2 million views.  Way to go Victoria!  If you are among the decreasing number of people who have not seen it yet, it is here on the PBI site: click here;
Now, some of you may be thinking, "Well, sure, it's easy for a photogenic 12-year old to get noticed" but in fact, just the opposite is true.  How many 12-year olds do you listen to on matters of reforming the economy, or any other major societal change, for that matter?  No, people are listening because Victoria's message was succinct, inspiring, and most importantly, correct.  It is worth not just watching her delivery for its content, but also to learn how all of us may better deliver our message.  Maybe we really don't need to "wow" people with our erudition.  Maybe we don't need to cover every factoid in a world with a limited attention span, already bombarded by supposedly urgent messages.  Most importantly, maybe we need to consider our audience better.

Now, I am no Victoria Grant, but from the Shameless plug Department:
I am also getting on alternate media - public access TV in this case : or here:
where I spent half an hour talking to host Lou Puliafito about Georgism/Geoism, Greenbacking, and State Banking.  It's hard to fit all that into 25 minutes, but I tried!  I hope to be invited back, maybe next month.

Also worthy of note, Bill Still's speech to the Public Banking Institute April 27-28 was posted by PBI.  Pay particular attention to the mention of Cliff Johnson's lawsuit against the Treasury (which I am advising upon).  Still spends a couple of minutes on this at the 20-minute mark because it will be a game-changer if it succeeds:
Thanks for the shout-out, Bill! 
(My new article about the Public Banking Institute's first annual conference is here:

The Johnson vs. Geithner lawsuit that would expose the lie that Federal Reserve Notes are equivalent to United States Notes and coins, continues to move forward, haltingly, while the government tries to dismiss it on technical grounds of lack of standing and other boilerplate rejoinders - anything to avoid answering the complaint itself.  The next court hearing will be on June 21.
A similar, if less specifically focused Sovereign Money lawsuit, has been brought in Canada:

Speaking of alternate money, a new LETS alternate money system is spreading in Euro-deprived Greece ( Perhaps government is so hopelessly addicted to private money creation that we will all have to initiate our own money systems!  LETS are proof that more money is needed in the real economy, where people will work for it and spend it.  We do not have a shortage of jobs.  We do not have a shortage of workers.  We have a shortage of money.  There is something wrong with this equation: # of jobs + # of workers + Amt. of money = Economic Health.  And yet, the TBTF banks just keep getting more and more money.  Is it doing any good, or....

Is JP Morgan about to blow up?

The latest Bank Derivatives Activities
Report on the Office of the Comptroller of the Currency site has some interesting info.  From the 4th qtr. Bank Derivatives Activities rpt: "The notional amount of derivatives contracts held by insured U.S. commercial banks in the fourth quarter fell by $17.2 trillion (6.9%) to $230.8 trillion from the third quarter." JP Morgan now has "only" $70 Trillion in derivatives - table 1 - higher than any other bank, but only $1.8 trillion in total assets (table 3) *IF* it's a good day and someone is buying. No one but the Fed was buying in the last meltdown, but that was for far less assets.
OK, so the total is headed down, but in a chart later on (pg. 17), JP has some 250% exposure as a "Percentage of Total Credit Exposure to Risk Based Capital." Only Goldman has a higher risk ( 800% ) profile.*

"The European Stabilization Mechanism,
Or How the Goldman Vampire Squid Just Captured Europe
Ellen Brown
April 13, 2012
The Goldman Sachs coup that failed in America has nearly succeeded in Europe--a permanent, irrevocable, unchallengeable bailout for the banks underwritten by the taxpayers.  
In 2008, Henry Paulson managed to extort a $700 billion bank bailout from Congress.   But the former CEO of Goldman Sachs had to fall on his knees and threaten martial law and the collapse of the entire global financial system to pull it off, and the bailout was a one-time affair.   Paulson's plea for a permanent bailout fund--the Troubled Asset Relief Program or TARP--was opposed by Congress and ultimately rejected.

By December 2011, European Central Bank president Mario Draghi, former vice president of Goldman Sachs Europe, was able to approve a 500 billion Euro bailout for European banks without asking anyone's permission. And in January 2012, a permanent rescue funding program called the European Stability Mechanism (ESM) was passed in the dead of night with barely even a mention in the press. The ESM imposes an open-ended debt on EU member governments, putting taxpayers on the hook for whatever the ESM's Eurocrat overseers demand.
The bankers' coup has triumphed in Europe seemingly without a fight. The ESM is cheered by Eurozone governments, their creditors, and "the market" alike, because it means investors will keep buying sovereign debt. All is sacrificed to the demands of the creditors, because where else can the money be had to float the crippling debts of the Eurozone governments?"

Brown goes on to quote from a recent youtube video, first out in German, that lists the articles of the "treaty" (treaty with who?) that would give the ESM complete power and immunity from everything.   The coup will be complete if this thing passes in July, 2012, which is expected to happen.  On this side of the pond, the story is almost completely ignored in the MSM.  Perhaps they'll ignore it when it happens here too; by then it may be too late anyway.

Ellen Brown gets even further ahead of the curve in a new article here:
Greece and the Euro: Fifty Ways to Leave Your Lover
in which she prescribes 5 ways (not 50) for Greece to end its self-destructive downward spiral. Greece has now seen its economy shrink by a depression-level 16%, with no end in sight.  Brown's prescriptions include:
1. The Open Marriage: Return to the Drachma Without Abandoning the Euro
2. Separate Bank Accounts: Fire Up the Printing Presses at the Greek Central Bank
3. Divorce: Just Walk Away
4. Spousal Support: The Public Bank Option
5. The Dowry: Impose a Financial Transaction Tax

Brown proves you don't have to be 12 years old to come up with creative, great solutions, though it helps.  A future edition of this newsletter will include an article featuring a recent 5-way conversation involving a precocious tri-lingual 12-year old I am happy to know, who got Georgism almost before it was fully explained, and has some great insights besides.  Stay tuned.  

Perhaps what we really need to so is to get back to First Principles and find out why...
Economies Blow Up
Max Keiser Interviews Fred Harrison   for some answers.  Harrison predicted the crash, years before it happened, and the reasons for it, speculation in Land .

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Scott Baker is a Managing Editor & The Economics Editor at Opednews, and a former blogger for Huffington Post, Daily Kos, and Global Economic Intersection.

His anthology of updated Opednews articles "America is Not Broke" was published by Tayen Lane Publishing (March, 2015) and may be found here:

Scott is a former and current President of Common Ground-NY (, a Geoist/Georgist activist group. He has written dozens of (more...)

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