Michael Hudson: The State and Local Budget Crisis By Michael Hudson, a research professor of Economics at University of Missouri, Kansas City and a research associate at the Levy Economics Institute of Bard College The cost of the 2011 cutbacks in federal spending will fall most directly on consumers and retirees by scaling back Social Security, Medicare, Medicaid and social spending programs. The population also will suffer indirectly, by lower federal revenue sharing with U.S. states and cities. State and local revenue, 1930-2007 Untaxing real estate has served mortgage bankers by freeing more rental income (the land’s site value) to be paid as interest. While homeowners saw their carrying charges rise, they nonetheless felt more affluent as real estate prices rose – inflated on easier and easier credit terms. From the local fiscal vantage point, these debt-leveraged price gains represented uncollected user fees for the site value provided by public infrastructure and rising prosperity.
When Debt Is More Important Than People, The System Is Evil Submitted by Charles Hugh Smith from Of Two Minds When Debt Is More Important Than People, The System Is Evil The Empire of Debt has only one end-point: a death spiral. It is evil and must be dismantled. Ethics has no place in the Empire of Debt. The financialized Status Quo is careful to limit the language used to describe the situation in Greece to the subtexts of "obligations" and "avoiding chaos." The reality being masked is that debt is now more important than people. 1. 2. This begs further investigation. The ethics of debt, at least in the officially sanctioned media, boils down to: nobody made them borrow all those euros, and so their suffering is just desserts. What's lost in this subtext is the responsibility of the lender. Consider an individual who is a visibly poor credit risk. Now a lender comes along who can create credit out of thin air (via fractional reserve banking) and offers this poor credit risk $100,000 in collateral-free debt at low rates of interest.
David Graeber’s Debt: My First 5,000 Words In the final lines of his introduction to Debt: The First 5,000 Years, David Graeber writes that “[f]or a very long time, the intellectual consensus has been that we can no longer ask Great Questions.” And as he put it in a guest post over at Savage Minds: The aim of the book was to write the sort of book people don’t write any more: a big book, asking big questions, meant to be read widely and spark public debate…[T]he credit crisis —and near collapse of the global economy in 2008—afforded the perfect opportunity. Debt is a “big book,” in other words, because he wants to re-open a set of questions that had come to seem closed “for a very long time,” the questions of “what human beings and human society are or could be like—what we actually do owe each other, what it even means to ask that question.” It’s a hard book to review, though, because it’s doing several irreducibly different things at once (which I’ll try to lay out in as logical a fashion as I can manage).
John Michael Greer on Resilience vs Efficiency “The rise of this term to its present popularity in green circles has a history worth noting. A year or two ago, the word “sustainability” began to lose its privileged place in the jargon of the time, as it began to sink in that no matter how much manhandling was applied to that much-abused term, it couldn’t be combined with the phrase “modern middle-class lifestyle” without resulting in total absurdity. Enter “resilience”, as another way to talk about what too many people nowadays want to talk about, generally to the exclusion of more useful conversations: the pretense that a set of lifestyles, social habits, and technologies that were born in an age of unparalleled extravagance can be maintained as the material basis for that extravagance trickles away. The word “sustainability”, it bears remembering, has a perfectly clear meaning. The problem with “resilience”, though, is that it also has a perfectly clear meaning. Okay, now that you’ve stopped spluttering, let me explain.
What Is The Singularity And Will You Live To See It? 1. I'm generally skeptical of the singularity and of post-scarcity economics in general. 2. I think it's interesting to ponder why the singularity might not occur. 3. 4. 5. 6. Debt The First 5,000 Years David Graeber “Brilliant … and unexpectedly funny.” —The Spectator (selected as a book of the year) Every economics textbook says the same thing: Money was invented to replace onerous and complicated barter systems—to relieve ancient people from having to haul their goods to market. The problem with this version of history? Here anthropologist David Graeber presents a stunning reversal of conventional wisdom. With the passage of time, however, virtual credit money was replaced by gold and silver coins—and the system as a whole began to decline. DAVID GRAEBER teaches anthropology at Goldsmiths College, University of London. “An absolutely indispensable—and enormous—treatise on the history of money and its relationship to inequality in society.” “Mr. “Debt [is] meticulously and deliciously detailed.” “Written in a brash, engaging style, the book is also a philosophical inquiry into the nature of debt — where it came from and how it evolved.” “[A]n engaging book.
Sachs: The Great Failure of Globalization Jeff Sachs: The great failure of globalization, by Jeffrey Sachs, Commentary, Financial Times: ...I’ve watched dozens of financial crises up close... Neither the US nor Europe has even properly diagnosed the core problem, namely that both regions are being whipsawed by globalization. Jobs for low-skilled workers in manufacturing, and new investments in large swaths of industry, have been lost to international competition. ... The simple fact is that globalization has not only hit the unskilled hard but has also proved a bonanza for the global super-rich. An improved fiscal policy in the transatlantic economies would therefore be based on three realities. Export-led growth is the other under-explored channel of recovery. Sadly, these global economic currents will continue to claim jobs and drain capital until there is a revival of bold, concerted leadership. ...
The 48 Laws of Power Background[edit] Greene initially formulated some of the ideas in The 48 Laws of Power while working as a writer in Hollywood and concluding that today's power elite shared similar traits with powerful figures throughout history.[5] In 1995, Greene worked as a writer at Fabrica, an art and media school, and met a book packager named Joost Elffers.[4][8] Greene pitched a book about power to Elffers and six months later, Elffers requested that Greene write a treatment.[4] Although Greene was unhappy in his current job, he was comfortable and saw the time needed to write a proper book proposal as too risky.[10] However, at the time Greene was rereading his favorite biography about Julius Caesar and took inspiration from Caesar's decision to cross the Rubicon River and fight Pompey, thus inciting the Great Roman Civil War.[10] Greene would follow Caesar's example and write the treatment, which later became The 48 Laws of Power.[10] He would note this as the turning point of his life.[10]
Too Big To Fail: The First 5000 Years One of the many fascinating pieces of information that David Graeber tosses off like shrapnel in Debt is that the first recorded appearance of the word “freedom” in a political document is in a Sumerian proclamation of a debt amnesty or jubilee. What interested me, however, from the point of view of a professional banker, is that the document in question provided only for the discharge of personal debts of the Sumerians; commercial debts of merchants were not discharged. Clearly (and I suppose there is an interesting anthropological history to be written of the extent to which the appropriate level of cynicism about these things as changed from pre-Christian Mesopotamia to modern London), anyone who could have convinced the Babylonian legal system that his liabilities were all personal debts covered by the jubilee, while his assets were all mercantile trade credits, would have made out like a bandit. This sets in motion the dzamalag exchange.
The Decline of Manufacturing in America: A Case Study One frequent and frustrating line that often crops up in the comments section of this blog is that American labor has no hope, it should just accept Chinese wages, since price is all that matters. That line of thinking is wrongheaded on multiple levels. It assumes direct factory labor is the most important cost driver, when for most manufactured goods, it is 11% to 15% of total product cost (and increased coordination costs of much more expensive managers are a significant offset to any savings achieved by using cheaper factory workers in faraway locations). It also assumes cost is the only way to compete, when that is naive on an input as well as a product level. This argument is sorely misguided because it serves to exculpate diseased, greedy, and incompetent American managers and executives. But if you were to ask most people, they’d now blame the fall of American manufacturing on our workers. The Escanaba mill makes coated paper. In 1969, Mead added a #3 machine in Escanaba.