Music For Those Who Hate the Grammys. Progressive Music Classics: "Joe Hill" by Paul Robeson

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By MARC McDONALD

Welcome to another edition of Progressive Music Classics.

I didn't watch the Grammy Awards this year. In fact, I never watch the Grammys (which is nothing more than a wank-fest of the corrupt U.S. corporate recording industry to celebrate another year of the utter mediocrity that clogs up today's pop charts). Anyone who thinks the Grammys celebrate the best of U.S. popular music probably also thinks the "Best Picture" Oscar actually has something to do with the best cinema of the year.

I suppose there might be some worthwhile music at the Grammys. But as the great Morrissey once sang, "It says nothing to me about my life."

Once upon a time, popular music actually had something to say. Listen to the best songs of the 1960s for example, and you can quickly get a sense of the issues of the day, from the Vietnam War to the youth rebellions that shook the Western world.

But these days, the songs are all about sex, bling-bling, and mindless consumption. And even the "best" music these days seems clinically crafted for one purpose: to shift as many units as possible.

It's all the more outrageous when you consider that one important function of the arts has been to hold a mirror up to society. Any outsider who listened to today's U.S. pop music would conclude that most Americans drive Bentleys, drink lots of Grey Goose, and spend their days having sex with supermodels.

If today's pop music really reflected U.S. society, it would reveal a broken, deteriorating nation that is facing a major crisis. Poverty is rising. The gap between rich and poor is at obscene levels. More and more kids are going hungry. The once Great American Middle Class is becoming extinct. And yet our corrupt government does nothing but act as a concierge service for the Rich & Powerful.

Do today's hitmakers like Justin Timberlake or Robin Thicke have anything to say about all this? No---in fact today's popular music has nothing much to say about anything, bar the odd left-field hit from Chumbawamba.

One artist who always did keep it real was the great Paul Robeson (1898-1976). One of the most important progressive artists of all time, Robeson was often persecuted by the Powers That Be for his beliefs. But he never apologized and never backed down.

In the video above, Robeson pays homage to another great progressive hero, Joe Hill, who was executed in 1915.

Today, it's easy for some to mock Robeson's leftist beliefs as "naive." But what I've always found really naive is how so many in our society now embrace a unregulated, unfettered "free market" as the answer to everything.

Somehow, in our society, it's always the lefties who are regarded as naive. But those who embrace hard-core dog-eat-dog capitalism are somehow regarded as "sensible" and "realistic."

But those who don't learn history are doomed to repeat the mistakes of the past. Back in the 1930s, unfettered capitalism led to the Great Depression. I believe that today's unfettered capitalism will likely lead to nothing less than the end of America as we know it.

The fact is, the middle class is dying in America. And without a healthy, vibrant middle class around to buy the products that the system produces, U.S. capitalism won't survive for much longer.

Where are the Joe Hills of today? And for that matter who is our generation's equivalent of Paul Robeson? You certainly won't ever find such a singer, watching the banalities of the corporate wank-fest called the Grammy Awards.

America's Imaginary Lavish Social Welfare Safety Net That Exists Only in GOP's Mind

By MARC McDONALD

In America, we hate the poor. We really, really hate the poor. We are indoctrinated from birth to hate the poor. Jesus may have said, "Blessed are you who are poor." But America has no time for that Jesus. Our motto is "Screw the poor."

As a result, America has never been big on social welfare programs for the poor. Even during the peak years of U.S. social program spending (during LBJ's "Great Society" years), America had a skimpy social safety net, compared to other industrialized nations.

Compared to generous European social safety nets, America these days more closely resembles the likes of Mexico than a modern First World industrialized nation. Jobless benefits, for example, are far more meager and stingy in the U.S. than they are in Europe. In fact, for one reason or another, millions of Americans don't even ever qualify for jobless benefits. (I know: I was one of them. Years ago, I applied for jobless benefits and was turned down).

The other pillar of the U.S. social safety net, food stamps, is also very meager. I recall recently playing around with the food stamp eligibility program on a Texas state government Web site. I was curious as to exactly how low one's income had to be in order to qualify. I kept plugging in lower and lower income numbers and kept getting a response page that said, "You earn too much to qualify for food stamps." Eventually, I concluded the Web site must be broken. It was only later that I discovered, much to my amazement, that the Web site was in fact working just fine and the Third World-like wages I'd plugged into the search form were indeed considered too high to qualify for aid.

In short, in America these days, if you're poor, you are screwed. The fact is, many low-income and poor people never even qualify for any type of aid. And the shocking numbers of homeless in the U.S. demonstrates that our social safety net is grotesquely inadequate to meet the needs of the needy. The fact that one in five children lives in poverty is a good indicator of that.

In fact, what meager social safety net programs that are around only exist because corporate America wants them to exist (a good indicator of just how corrupt our government is these days).

Take food stamps for example. This program simply wouldn't exist were it not for the likes of Walmart. Since Walmart (a vastly profitable mega-billion-dollar corporation) can't be bothered to pay their workers a living wage, we the taxpayer in effect subsidize their wages via food stamps, (as well as other programs like Medicaid).

Give corporate America credit: they do know how to exploit a situation to boost their profits.

Despite all this, today's Republican Party is convinced that the reason America is going broke is that we supposedly fund all these lavish, generous social safety net programs. Indeed, the likes of Rush Limbaugh constantly ramble on about "trillions of dollars" that are supposedly spent on welfare. The typical Limbaugh listener these days is convinced that America is going broke because of "excessive welfare spending" and "lavish foreign aid."

It's all a lie, of course.

Welfare programs for the non-working poor are in fact a tiny part of the federal budget (5 percent, in fact). And, as a percentage of GDP, America's foreign aid budget is smaller than virtually any other industrialized nation. (In fact, what foreign aid we do spend is often nothing more than backdoor military aid).

It's one thing for clowns like Limbaugh to lie about welfare. But I also routinely hear other, more mainstream Republicans lie through their teeth about America's "lavish" welfare spending.

The reason is obvious. It's easier to beat up on the poor and the needy and make them a scapegoat for America's economic crisis. The real reason for America's titanic deficits (out-of-control military spending and insane trillion-dollar wars) rarely gets a mention in our mainstream political discourse.

Republicans are happy to shovel trillions of dollars into the wasteful, corrupt monster known as the Military Industrial Complex. And then they have the gall to blame needy children for bankrupting the American nation.

The reason is obvious, of course. The Military Industrial Complex employs thousands of lobbyists who are willing to shower billions of dollars on "our" representatives in Congress.

By contrast, needy children don't have any lobbyists to represent their interests.

America is a nation that has a serious addiction to massive trillion-dollar military budgets. By contrast, programs for the poor are a small slice of the federal budget. To blame the latter for America's fiscal woes is the equivalent of a drug addict who spends $500 a day on crack cocaine and then blames his budget woes on the fact that he spends a quarter a day on a newspaper.

I believe today's Republicans are playing with fire when they continue to attack the poor and continue to work to slash what little remains of the U.S. social safety net.

The poor, the needy, the impoverished have been crapped all over by this government for decades. Their growing ranks (and their growing desperation) is a ticking time bomb that will eventually blow up in the face of our corrupt government and the plutocrats that it serves.

How Ronald Reagan Unwittingly Laid the Groundwork for the Death of Capitalism

By MARC McDONALD

Thanks to tireless efforts by historical revisionists over the past two decades, Ronald Reagan has gotten a lot of credit for achievements that he had nothing to do with. "Winning" the Cold War is a good example.

In reality, Reagan's policies had little or nothing to do with the collapse of the Soviet Union. In fact, the last thing the Military Industrial Complex ever wanted was to see the Cold War's end (and with it the trillion-dollar gravy train of "defense" contractor funding).

On the other hand, Reagan should get credit for something that he actually did achieve: laying the groundwork for the death of capitalism as we know it.

Capitalism had its first near-death experience during the Great Depression. Ironically, it was saved by the most progressive president that the U.S. ever had: Franklin D. Roosevelt. Although attacked by the business community at the time, FDR's New Deal in fact resurrected capitalism and gave it new life. The New Deal created the Great American Middle Class: tens of millions of well-paid workers that actually had the money to buy the products that the system produced.

It was a wonderful arrangement that made America a superpower and the most envied nation on the planet for decades to come.

However, America's wealthy never got over their hatred of FDR and the New Deal---despite the fact the latter saved capitalism from itself. The Rich & Powerful constantly plotted to abolish the New Deal. And in 1980, with Reagan's election, the wealthy class finally saw its chance to begin the attack on the New Deal---a process that continues to this day.

Under Reagan, middle class entitlements were slashed, as were programs to assist the poor. And sweeping changes in tax policy began to favor the very wealthy, at the expense of the middle class and the poor. Also, labor unions and labor laws were gutted. Lastly, under Reagan's disastrous "free trade" policies, America started shipping all its good-paying manufacturing jobs overseas.

The result of all this was that, under Reagan, the Great American Middle Class began to shrink---a process that continues to this day. And with a much-weakened middle class, U.S. capitalism has hit a major crisis in that fewer and fewer consumers are able to buy the products that the system produces.

The latter is a crucial component of capitalism that has long been curiously overlooked by the "free market" Chicago School zealots who've long championed a completely deregulated economy. I find it interesting how these zealots are always so concerned about the plight of the "over-taxed, over-regulated" rich (who they claim are the only necessary ingredient for successful capitalism).

Of course, what these ivory tower zealots overlook is that capitalism as we know it simply can't function unless there is a strong, prosperous middle class around to buy the products created by the system.

Although Reagan's policies gutted the U.S. middle class, the resulting devastation to capitalism didn't become readily apparent until much later on. This was because the whole crisis was masked by America's increasing embrace of credit-fueled consumption, which created the mirage of prosperity.

Under Reagan, America simply stopped paying its bills. The government started borrowing hundreds of billions of dollars from the likes of Japan. And consumers increasingly started pulling out their credit cards to pay for purchases, rather than using cash.

Finally, a series of bubbles came along to further create the illusion that the American economy was much more prosperous that it really was. These included the Dot Com bubble and the more recent housing bubble.

Of course, the whole Ponzi scheme all came crashing down in 2008. Since then, the U.S. economy has remained on life support. The nation continues to plunge further into debt, even as the U.S. dollar continues to hit new all-time lows. The middle class is all but extinct these days, as are the good-paying jobs that once help make the American economy the mightiest on earth.

Virtually all of this is a legacy of Reagan's policies. And unlike capitalism's first near-death experience, in the 1930s, it's extremely unlikely that we'll see another FDR ever come along to give the whole system a new lease on life. In our Citizens United era, that's simply not ever going to happen.

Reagan (or more specifically, his wealthy backers) originally aimed to crush the New Deal and return the U.S. to an unregulated 19th century dog-eat-dog form of capitalism. They hoped that this would propel capitalism to new heights. But by ignoring the key role of middle class consumption in their calculations, they unwittingly severely damaged capitalism itself and turned America into a second-rate power.

We continue to see the corrosive effects of the Reagan legacy to this day. The serious problems that began to emerge during his presidency (out-of-control fiscal and trade deficits, a shrinking middle class, the loss of good manufacturing jobs, and a plummeting dollar) continue to this day.

Of course, the wealthy class to this day continues to live in denial that the whole capitalist party is now over. They continue to cling to the hope that the crisis caused by the 2008 economic collapse will eventually be fixed and the capitalism will somehow continue.

The problem is that the good-paying manufacturing jobs are gone for good. And the much-hyped service economy jobs that were supposed to replace the latter have in fact been poor substitutes, offering vastly lower pay and benefits, for the most part. In fact, to this day, America continues to bleed what few good manufacturing jobs it has left, thanks to the utter absence of any kind of intelligence trade policy.

What's more, given the ever-weakening dollar and the ever-growing trade and fiscal deficits it faces, America has less and less clout on the world stage. For the entire post-World War II era, America could simply print more dollars to bail itself out of fiscal crises, given that the dollar was the world's international reserve currency. That era, clearly, is near an end.

With the demise of the dollar, America will be a much weaker and less wealthy nation. For the entire post-World War II era, America has been the standard-bearer for capitalism. With the latter now discredited, it's clear that the rest of the world is increasingly rejecting the U.S. model of economics and is instead turning to the regulated, technocrat-led economies of China and Singapore as the new role model.

Not only did Reagan's era doom capitalism, but his toxic legacy ensured that America will find it extremely difficult to remedy the crises that resulted from his administration. These range from the deterioration of public education that resulted from Reagan's budget cuts to America's crumbling infrastructure. These two factors alone will make it increasingly difficult for America to compete globally in the years to come.

But perhaps the most toxic legacy of all was Reagan's abolishment of the Fairness Doctrine. This ensured that America's mainstream media would increasingly do little more than parrot the official corporate line. Americans today are hopelessly misinformed on the issues these days. And a nation that is misinformed is going to find it difficult to ever take the necessary steps needed to fix the crises unleashed by Reagan's policies.

As Hunger Rises In U.S., Millions Forced To Wait For Food Stamp Benefits

By MARC McDONALD

Feeding America, a non-profit food bank network group, reports that hunger is "increasing at an alarming rate in the United States."

Despite this, a recent review by The Associated Press found that dozens of food-stamp programs in 39 states left at least a quarter of applicants waiting weeks or months for food aid.

America is currently in the grip of the worst economic crisis since the 1930s. With millions of ongoing job layoffs and a high jobless rate, it shouldn't be surprising that many American families are now finding it increasing difficult to afford even the basics, including food.

The cost of the U.S. food stamp program runs around $50 billion a year. That may sound like a lot, until you consider that it is nickel-dime chump change, compared with other government programs that primarily benefit the wealthy.

Take for example, Bush's bailout of the corrupt gangsters on Wall Street. That welfare-for-the-rich program is set to cost the U.S. taxpayers a cool $1 trillion.

Of course, even that pales in significance compared to the $3 trillion that the U.S. is flushing down the toilet in the fiasco known as the Iraq War (and the ever-growing costs of the fiasco known as the Afghanistan War).

For the same amount the U.S. spends in a few months in Iraq, we could fully fund the U.S. food stamp program for one year and ensure that no children go to bed hungry.

But then again, crony corporate pigs like Halliburton and Blackwater might then have to suffer a slight decrease in the billions they've reaped in closed, no-bid contracts in Iraq.

So while the Top One Percent of rich Americans continue to gorge themselves with a generous helping of our tax dollars, ordinary citizens continue to struggle as the U.S. economic crisis continues.

AP notes that currently, a record 40 million people (one in eight Americans) now rely on food stamps.

"The number of participating households increased by one-fifth in fiscal 2009, and many states' food-stamp rolls grew by a third or more" AP reported.

The Debtors' Revolt Begins Now

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Ann Minch of Red Bluff, Calif., a 46-year-old stepmother of two is angry as hell, and she's not going to take it anymore, according to HuffingtonPost. Minch has carried a balance of several thousand dollars on her Bank of America credit card for years and says she's never missed a payment.

Now Bank of America has rewarded her loyalty by repeatedly raising her interest rate, which reach 30 percent in July. (Yes, the same Bank of America that pocketed $25 billion of our tax dollars in the federal government's bank bailout last year).

Fed up, Minch turned to YouTube.

As Minch notes in her video:

"You are evil, thieving bastards. You have reaped ungodly profits in your behemoth casino scams, then lost, only to turn around and usurp the wealth of this great nation by the outright rape and pillage of middle class Americans, whose sweat and toil built it. The biggest ripoff in the history of the world is padding your bonus checks, with the federal government as your co-conspirators. Every last one of you should be rotting in prison."

Gannett Co. Lays Off Thousands As CEO Pockets Millions

By MARC McDONALD

Gannett Co., the biggest U.S. newspaper publisher by daily circulation, has been taking a hatchet to its work force in recent years, even as its CEO pockets millions in compensation.

In the latest round of cuts, announced Wednesday, Gannett announced another 1,400 layoffs in the next few weeks. That amounts to 3 percent of the workforce.

One person at Gannett who isn't suffering these days is CEO Craig A. Dubow. In 2008, Dubow pocketed $3.7 million in compensation. That includes a base salary of $1,166,667, as well as stocks, options and other compensation. The year before, Dubow got $7.9 million in compensation.

In 2008, Gannett cut 4,600 jobs. It also required "most of its remaining employees to take unpaid leave in the first and second quarters."

In 2008, Gannett was ranked as "one of America's worst places to work," according to employee survey site Glassdoor. Dubow's approval rating stood at 19 percent, according to the survey.

Last year, Gannett stock fell in value 75 percent. Gannett lost $6.6 billion in 2008.

Where Were The "Tea Party" Protesters During Bush Years?

By MARC McDONALD

Lately, Fox News has been hyping the upcoming "Tea Party Protests," set for April 15. The event is supposed to be nonpartisan. But the people who purport to represent the movement are doing a lot of Obama-bashing.

Typical of the latter is a comment by a group organizing a local Tea Party event in Florida, which claims the protest is targeting the "outrageous spending by the Obama administration."

Which leads to me wonder: where in the f*ck were these protesters during the administration of George W. Bush?

Bush, as you'll recall, inherited a $128 billion budget surplus from Bill Clinton when he took office in 2001. Bush quickly squandered that and then proceeded to rack up gigantic budget deficits every year of his two terms in office.

Under Bush, the national debt grew by more than $4 trillion: the biggest debt increase of any president in U.S. history.

When Bush took office in 2001, the national debt stood at $5.7 trillion. At the end of Bush's two terms, the debt had skyrocketed to more than $9.849 trillion. And remember: Bush enjoyed a Republican Senate and House of Representatives during most of his time in office.

Things weren't helped along any by Bush's illegal and totally unnecessary Iraq War. That disaster will probably wind up costing the U.S. $3 trillion. It would be nice if some of these Tea Party protesters asked for an immediate halt to the $10 billion a month that America continues to squander in Iraq every month to this day. But I suspect there won't be too many "Stop the Iraq War" signs at these Tea Party events.

Like I said, where were these "tea party" protesters during the Bush years? Where were they when Bush was handing out billions of our tax dollars to his wealthy friends? Where were they when Dick Cheney's former company, Halliburton, was pocketing billions of dollars in closed, no-bid contracts? Where were they when $12 billion in cash disappeared without a trace after it was shipped to Iraq?

Obama has only been in office a few months. He inherited the worst economy since the Great Depression.

I'd suspect that most of the nearly 70 million Americans who voted for him understood very well what an Obama administration would bring: higher taxes on the rich and more domestic spending by the government to re-start the disastrous economy Obama inherited. Ten million more voters supported Obama's plans than the 59 million McCain voters who wanted more of the same failed GOP policies that got us into this mess in the first place.

The fact is, Obama is simply carrying out the policies that he promised during his campaign. They are policies that the majority of voters want---a fact that the Tea Party Protesters appear to be totally ignorant about.

The Tea Party Protesters clearly do not represent what the majority of Americans want. They claim to speak for "the people," but the people have already spoken. They spoke with their ballots in the 2008 presidential election.

Incidentally, the Tea Party Protesters seem to be clueless about the original 1773 Boston Tea Party, which was prompted by an decrease, not increase, on tea taxes.

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New York Times Company CEO Pockets Millions While Demanding Steep Union Concessions

By MARC McDONALD

The New York Times Company, owner of The New York Times and The Boston Globe, has taken the gloves off (and put on a pair of brass knuckles) in hard-line negotiations with its unions. The company is threatening to close The Boston Globe unless the newspaper's unions quickly agree to $20 million in concessions, the Globe reported on Friday, quoting union leaders.

But while The New York Times Company is demanding that its employees make steep sacrifices, its CEO is raking in millions.

The New York Times Company CEO Janet L. Robinson raked in $5,578,451 in compensation for 2008. This includes $1,552,603 in restricted stock awards, as well as a salary of $1 million, according to Forbes.com.

Once again, America's CEOs pull down huge pay packages, even as they demand brutal sacrifices from their workforces across America.

You know, I expect this sort of thing from a hard-line, right-wing company like the Coors Brewing Company. But this is the "liberal" New York Times for Chrissakes. So much for the now-quaint notion that "The business of a newspaper is to comfort the afflicted and afflict the comfortable."

And the Kool-Aid Drinker of the Day Award Goes To...

BeggarsCanBeChoosers.com reader Victor gets the Kool-Aid Drinker of the Day Award for his insightful response to the recent article by Manifesto Joe that we posted here, titled "Is A Capitalist Meltdown Upon Us?" which took a look at the current economic crisis.

Victor's award-winning comment reads thusly:

"At the end of WWII, Eisenhower and his troops rolled into the last of the concentration camps and killing fields uncovering unspeakable horrors with emaciated bodies piled into mountains. He had the foresight to order his men to 'Get it all on record now - get the films - get the witnesses - because somewhere down the track of history some bastard will get up and say that this never happened.'
In spite of the reams of evidence to the contrary, there are holocaust deniers around the world. Driven by the emotion of their conviction rather than the facts staring them in the face, they make utter fools of themselves.

You people remind me of those idiots who ignore the lessons of the past because of your own selfish agenda. It some kind of insane frenzy to "stick it to the man," you are willing to hand over your freedoms and to deny liberty to your own children. I knew jealousy was a powerful emotion, but I had no idea it could be fanned to such an incinerating level such as we are seeing. It is no longer considered acceptable to praise and reward achievement. Now it is called excess. The winners who our economy is built around are being pulled down by the losers who have never been willing to demonstrate any energy or to produce anything. And when it is over, they will look around and say, "Why do we not have jobs? What have we done?"
But the true lessons of the past tell us the only thing government can do to help an economy is to lower taxes, get out of the way, and let the markets do what they will. It always works. And because lower taxes lead to increased wealth, it always results in greater treasury receipts.
But you seek to cover up the past. You say it never happened. You refuse to admit the lessons of growing government a la FDR, LBJ and now Obama have been catostrophic to the economy.
But the pendulum will swing. In 2010 conservatives will muster and amass on Washington after this orgy is over and the filthy aftermath is shown in the light of day. Lets hope that once they shut down the Maniac on Pennsylvannia Ave. they keep their wits about them this time.
And I want to say one more thing. Fuck you. Fuck you all who gleefully allow this proud nation's might and traditions to be trampled, raped, starved and killed off like those innocents in Germany. You should be ashamed."
----Victor

Congrats, Victor, you get our Kool-Aid-Drinker of the Day award. But first, here's a few bulletins from Planet Earth:

1. Re: Eisenhower wanting to "Get it all on record."
Actually, that's what we Dems have long wanted to do with Bush's treasonous crimes. But (as was the case during the Reagan/Ollie North years) Bush and Cheney were the masters of secrecy and destroying records.

2. "The winners who our economy is built around are being pulled down by the losers who have never been willing to demonstrate any energy or to produce anything."

Yeah, losers like Warren Buffett, the richest man on earth, who has urged Congress to raise taxes on the rich. Clearly, Buffett doesn't know anything about economics or prosperity and, instead, we should listen to geniuses like GWB, (who was such a big success in the private sector).

3. "In 2010 conservatives will muster and amass on Washington after this orgy is over."

Yeah, the GOP showed us how "conservative" they are during the past 10 years (during which they held all the levers of power in D.C.) They inherited a surplus from Clinton and proceeded to double the nation's deficit with things like their $3 trillion war fiasco in Iraq. Yes, these are the people who we can depend on to restore fiscal sanity to Washington.

Oh and as far as the current Second Great Depression, it's clearly unfair to blame it on the GOP. No, let's blame it all on Obama, who's been in office a few weeks.

Please, Victor, turn off Rush and EDUCATE YOURSELF, moron.

Is A Capitalist Meltdown Upon Us?

By MANIFESTO JOE

I'll only be 53 on my next birthday in late July, yet it already seems like I've lived a tiring amount of history. Only 20 years ago, the world saw the meltdown of Soviet-style communism -- and many observers, largely neo-conservatives, interpreted that as an ideological culmination, "the end of history." There was even an influential book written with that title. (Does anyone remember that author now? And, does he want to remember that book? Yeah, I know -- Francis Fukuyama.)

It appears that reversals of fortune can happen quickly. Now it looks like the allegedly venerable ideology of "free-market" capitalism is on the ropes, and in serious danger of going down. Who would have thought it?

Die-hard Marxists did. I've never been one of them, even as a long-ago radical all of 23 years old. I still know three people who have continued to call themselves Marxists in total defiance of dismissal or ridicule, and they are probably gloating a lot now. The economic train wreck they kept dogmatically predicting finally seems to be in front of us.

But even as America sleepwalked through our Second Gilded Age (circa 1981-2005), I grew skeptical of the Marxist vision. "Historical inevitability" always sounded like a religious tenet, without the pure superstition; and Marxism itself, a sort of quasi-religion for embittered atheists.

We should be as cautious about awarding hard-line socialists a victory here, as much as "we" (in the editorial sense) should have checked for our wallets the minute Reagan started talking about trickle-down and Phil Gramm started talking about deregulation. The past century should have taught us that the answer lies in between.

Starting with the excesses of laissez-faire: America has, for the past 30-ish years, seen the roller-coaster ride that happens with that sort of economic policy. An elite grows very rich, a minority near the bottom slips much further down, and most people tend to stagnate in the middle.

There are cycles of boom and bust. The booms are good for most people, but especially good for a few. The latter group inevitably forms a "Why Should I Have To Pay Taxes?" lobby and gets bonanzas from lawmakers eager to please. And since these are the people of ostentation and material success, their influence is great among fashionable "thinkers" of the day.

Now the big bust is upon us. It's a bit like 1933 all over again -- not as grim or total in devastation, but it's likely to get worse. President Barack Obama has warned us that this is so.

But history, with its entire lesson, should be heeded, and it seems like Obama is one who will do so.

There were very good reasons for the meltdown of the Soviet empire 20 years ago. Contrary to right-wing mythology, Reagan and his military buildup had little to do with it. Post-Soviet Russian economists recall the problems as internal, and any intellectually honest person knew what they were. There's no need for me to recite the litany here -- Americans heard it all for decades.

But let's face it, die-hard socialists out there -- state-run enterprises have a poor track record. The employees seem to lack incentives to produce. Cooperatives tend to degenerate into personal conflict, power struggles and chaos. And as for the concentration of power in the hands of "vanguard revolutionaries" -- the horrors and enormities of that have been abundant just in the past century.

I don't think it's hard to argue for a sense of balance and measure. In America, it seems like the compromising wheeler-dealers -- the FDRs, the Trumans, the LBJs, the Ted Kennedys -- got more done for working Americans than any of our homegrown radicals ever did.

But there is little doubt that there's been a sea change, and it's been back toward socialist thinking. The Nobel Prize committees have not been known for their sympathy toward socialist-leaning economists, yet Nobel Laureate economist Joseph Stiglitz has more or less come out in favor of the nationalization of U.S. banks. That would be a major step toward socialism of some fashion. Why not? We've just given the bastards $700 billion in taxpayer money to keep them in business. Here's a link to the interview with Stiglitz.

And, it appears that such state power would be the only thing to force the shameless swine who run these enterprises to behave themselves. Sen. Claire McCaskill, D-Mo., made a speech on the Senate floor about the Wall Street oinkers who had themselves awarded $18.4 billion in bonuses while their enterprises got in on the aforementioned $700 billion, because of reckless and disastrous mismanagement. Here's another link to reports on this issue, and to a video of McCaskill's speech. Be patient, the video seems very rough.

So, what should be the ultimate American destination, in an era of "capitalist" meltdown? The Swedes, with a hybrid socialist-capitalist system, don't seem to do badly, with avowed Socialists predominantly in power since 1929. Their booms are smaller, but so are their busts. Their people don't live in fear of homelessness or inability to afford basic health care. Right-wing humorist P.J. O'Rourke, when asked about the Swedes' seeming happiness with their stable system, said that they are all insane -- but that their insanity is distributed equally among the people.

It's a funny line. But there's nothing funny about facing a mortgage foreclosure, or about the welfare rolls shrinking even as joblessness is rapidly expanding. With a growing U.S. underclass, it may be time to take a second look at the socialist mind-set -- despite the old Marxist baggage. Nobody requires us to go to extremes.

Manifesto Joe is an underground writer living in Texas. Check out his blog at Manifesto Joe's Texas Blues.

Bush's Last 10 Days, Part 1: Recipe For Fiscal Disaster

By MANIFESTO JOE

As the countdown to Bush as ex-"president" begins, it might be good to put into context why some Americans, even some U.S. historians, regard Il Doofus as the worst "president" of modern times.

The federal deficit for the current fiscal year is being projected at $1.2 trillion. That's more than the entire national debt was at the time Jimmy Carter left office in January 1981.

The Congressional Budget Office report lays much of the blame for this spike on lower tax revenues due to the recession, and on $400 billion spent to bail out Fannie Mae, Freddie Mac and various financial institutions amid the mortgage crisis. Bush policies did a great deal to contribute to all of the above, but that's another post. For now, let's stick to the budget.

The deficit for fiscal 2007-08 was about $455 billion, consistent in real dollars with what was being run annually during the Reagan and Bush I presidencies. It's not too shocking, until you consider that Bush II inherited what had been the largest surplus the federal government has ever run, some $230 billion in fiscal 1999-2000, from departing President Bill Clinton's administration.

The surplus decreased to $158 billion during fiscal 2000-01, which Bush presided over some of. Bush apologists have tried to make an end run out of this, saying that declining revenues due to a briefly sour economy were responsible. They've also pointed out that the Clinton surpluses occurred even though federal tax cuts were passed in 1997, an apparent argument for supply-side policies.

That's fair enough, up to a point. But by 2001-02, the federal government was in the red again, and that continued year after year until the aforementioned $455 billion deficit was reached. How did this happen?

Bush spent the first months of his presidency pushing tax bonanzas, mainly for his rich friends, through the Congress, along with scraps from the rich man's table for the rest of us, amounting to $300 per person. His economic plan basically rolled back the relatively modest Clinton tax increases on the wealthy, passed by the narrowest of margins in 1993.

Students of fiscal policy know that it's anything but simple, but a few policy effects during this administration seem clear. It didn't take long to turn surpluses into deficits, and arguments that this isn't related to tax policy are, at the very least, unconvincing.

Then, after 9-11, Bush the "decider" decided to take the country to war(s). The first one, in Afghanistan, seemed and still seems like a defensible action, despite the toll on the Afghan people. The second, the March 2003 invasion of Iraq, was in hindsight clearly elective. Aside from being an act of aggression, it turned out to be one of the most expensive mistakes a U.S. administration has ever made.

According to a July 2008 update, military operations alone in Iraq and Afghanistan have cost $872.6 billion. Some $661.1 billion of that was for ops in Iraq. Source: Congressional Research Service data.

Even conservatives need to put this into perspective. Would Winston Churchill have held fast to big tax cuts for the wealthy during an expensive war, and even have audaciously pushed for more such cuts?

George W. Bush did. And in so doing, the U.S. was set up, and knocked down like bowling pins, for the $1.2 trillion annual deficit we now face. Now tell me that, as a "president," this buffoon didn't suck great big green ones, with warts on them. His decisions were consistently the worst that could have been made, and yet he stubbornly continues to defend them. I don't think future generations will find his defense convincing.

Manifesto Joe is an underground writer living in Texas. Check out his blog at Manifesto Joe's Texas Blues.

Fearmongering Finally Blows Up in GOP's Face

By MARC McDONALD

At one time, fearmongering was the best thing that ever happened to George W. Bush and the NeoCons, as they cynically exploited 9/11 to advance their agenda. But now it's backfiring, as panic and fear fuel the economic meltdown.

For the past seven years, the GOP repeatedly did its best to scare the living bejesus out of the American people.

It's a strategy that worked, time and time again, and even played a key role in returning Bush to the White House in 2004.

The American people have been kept in a state of fear ever since 9/11, thanks to Bush's fearmongering. But it's a strategy that's now backfiring for Bush and the GOP.

Fear, after all, is what fuels stock market crashes and panic selling. And fear is clearly playing a big role in the current economic debacle. Although the underlying economic reasons for the crisis are real enough, it's clear that panic and fear among investors and consumers is making the crisis even worse.

The American people are increasingly afraid of doing anything with their money, outside of stuffing it into a mattress. They don't trust mutual funds. They don't trust banks. They don't trust Wall Street. And they don't trust the Fed. Increasingly, they're embracing the mindset that Americans shared during the 1930s Great Depression.

For seven long years, Bush cynically used the fear of terrorism to manipulate the American people. As a result, Bush even got the American people to initially support his disastrous invasion of Iraq.

Between color-coded terror alerts and the constant scare words and language of fear and confusion, Bush got the American people so scared that they were ready to accept anything he wanted. As a result, Bush got whatever he sought, from shredding the Constitutions to embracing torture as official state policy.

But now it's backfiring. A terrified and fearful American people are simply going to stop spending money. They're going to sell their stocks. They're going to bail out of their mutual funds. And the U.S. is going to enter a lengthy and brutal second Great Depression. By the time this nightmare is over, the U.S. could easily become a Third World-like nation. It will almost certainly lose its status as the world's only economic superpower, as the world's balance of power shifts to East Asia.

And now, along with the Project for the New American Century, the Republican brand is now severely tarnished, perhaps forever.

How the American Economy Became a Sleazy Carnival Freak Show

By MARC McDONALD

Whatever happened to the once-mighty American economy?

The United States once had the mightiest economic juggernaut of any nation in history. Our "Arsenal of Democracy" played a big role in winning World War II. During that conflict, we overwhelmed our enemies with a tidal wave of efficient industrial production of everything from bombers to jeeps to battleships.

During the 1950s, America's industrial might was at its peak. We were the richest, most prosperous nation in history. U.S. workers earned the highest wages in the world. We enjoyed the most generous benefits and vacation time of any First World nation. American products, from planes to cars to televisions, were second to none in quality and were in demand worldwide. The Great American Middle Class was a prosperous and growing club that saw its fortunes improve, year after year.

Today, all of this seems like a distant memory. America's economy today is a joke. "Made in the U.S.A." is no longer a symbol of quality. In fact, our nation doesn't make much of anything these days. Our trade deficits are at nightmarish levels. And in three short decades, we've gone from being the world's biggest creditor nation to its biggest debtor nation.

Since we don't manufacture anything these days, all we Americans do these days is buy stuff made in other nations. And we really don't even have the money to do that, so we borrow trillions of dollars from prosperous nations in East Asia.

In fact, the U.S. economy today resembles a sleazy carnival midway. Rather than producing useful goods and services, our Carnival Freak Show Economy these days spends more and more time running scams and swindling people (think Wall Street). We've exported most of the good-paying jobs that sustained our once-mighty middle class. And the gulf between the haves and have-nots has grown to its widest since the infamous Gilded Age of the late 19th century.

A half-century ago, General Motors was the nation's biggest employer. Today it's Wal-Mart, a company that offers such paltry wages and benefits that many of its workers have to file for public assistance just to make ends meet.

And that's just one of the ways that Wal-Mart, and other Fortune 500 companies, pocket corporate welfare. In fact, corporate welfare plays a big role in today's Carnival Freak Show Economy.

Not only have the good middle-class jobs disappeared from the U.S. economy, but ordinary workers who do still have jobs have seen their wages stagnate for the past 30 years. Meanwhile, the richest 1 percent now garner the largest share of the national income since 1929.

One might ask: if the once-great American economy no longer produces anything useful, what exactly does it do these days?

Good question.

Decades ago, America's great corporations were widely admired. Most Americans back then felt they were a positive force in American society. Back then, corporations created good jobs and produced things of value. They also paid taxes (back in the 1950s, for example, corporations paid half of all taxes---today, it's less than 10 percent).

Contrast that to today. Today's biggest corporations, from ExxonMobil to Wal-Mart, are increasingly feared and hated. Many Americans regard them as greedy money-grubbing entities that can't be trusted.

The same could be said of today's CEOs in general. As recently as 1982, the average CEO made around 42 times what the average worker earned. By 2005, CEOs made around 431 times what the average worker earned.

And what, exactly, have CEOs done to earn this phenomenal increase in pay? It's hard to say. In fact, in recent years, there has been an increasingly disconnect between soaring CEO pay and the performance of U.S. corporations.

Take Peter Cartwright of Calpine, a maker of gas-fired power plants, for example. In 2005, Forbes reported that Calpine's average annual return to shareholders over the past six years had been minus 7 percent. During the same period, Cartwright pocketed an average annual $13 million. So much for the wisdom of the "free market."

In fact, the "free market" has nothing to do with it. It's a rigged game---just like the crooked games one encounters at a sleazy carnival midway.

When you go to a carnival midway, it's wise to keep an eye on your wallet. And America's Carnival Freak Show economy is no different these days.

The Military-Industrial Complex: A Profiteering Monster

As an example, take a look at America's military-industrial complex, a major pillar of the modern U.S. economy.

Today's military-industrial complex has turned into the very threat to democracy that Dwight D. Eisenhower warned us about in 1961.

It's a bloated, inefficient, tax dollar-devouring, profiteering monster that is out of control. And for all the trillions of dollars it consumes, it's difficult to really see how the nation benefits from it. After all, for all the ocean of dollars our nation has sunk into the Pentagon, it wasn't able to prevent 19 young men armed with nothing more than box cutters from inflicting on our nation the worst terrorist attack in history.

Curiously, for such a major, and costly, part of our economy, the military-industrial complex gets little scrutiny from our politicians these days. They're happy to continue feeding the monster, with little oversight, as long as the big defense contractors are generous with their campaign contributions.

And although Halliburton has garnered the most headlines as the biggest piglet at the trough, it's hardly the only defense contractor reaping fat, no-bid, "cost-plus" contracts, year after year.

In fact, the Center for Public Integrity revealed in 2005 that some $900 billion in defense contracts since 1998 had been awarded without competitive bidding or effective oversight. It's crony "capitalism" at its finest. And the suckers on the carnival midway are We The People: the taxpayers who fund the whole racket.

Wall Street: Crony Capitalism

Continuing our tour of America's Freak Show economy, lets take a look at a second major pillar of the modern U.S. economy: Wall Street.

While never universally loved, Wall Street has captured the American imagination over the decades as a symbol of U.S. economic might. But these days, most Americans fear and detest Wall Street---and for good reason.

Wall Street once played an indispensable role in the U.S. economy. But it's increasingly difficult to determine what, exactly, Wall Street does that is useful these days. Wall Street's idea of "innovation" these days is to create ever-increasingly complex financial instruments that no one can figure out. It's all a scam that is becoming unglued as investors become increasingly wary of what they're putting their money into.

And like the military-industrial complex, it seems Wall Street can only function these days with a hefty dose of billions of U.S. taxpayer dollars. (Take, for example, the Fed's recent bailout of investment bank, Bear Stearns). Although U.S. Treasury Secretary, Henry Paulson defended the bailout as necessary, ordinary American saw it as yet another example of rigged crony, "capitalism."

The Great American Prison Industry

Continuing our tour of America's Carnival Freak Show Economy, let's not leave out what has emerged in recent decades as the fastest-growing sector of our economy: the Great American Prison Industry.

America, the "land of the free," now has the world's biggest prison population, with a staggering 2.3 million people behind bars. Not surprisingly, the prison industry has become one of America's leading employers. And towns with bleak economic prospects now court new prisons the way they once courted new factories. Increasingly, Americans are either in prison, or working for a prison (a strange trend for a nation likes to think of itself as a beacon of freedom).

In past decades, Americans used industry and manufacturing to build our nation into the greatest superpower the world had ever seen. Today, we've "outsourced" our manufacturing and made shopping (with borrowed dollars) the main pillar of our nation's Carnival Freak Show economy.

Of course, it's all a big Ponzi scheme that is unsustainable. The nations that hold our increasingly worthless currency are likely to eventually get spooked and start off-loading their dollars. When that day comes, Americans will finally realize that whatever "prosperity" our economy has seen over the past three decades has been nothing more than a credit-fueled mirage.

When that day comes, we Americans will finally realize that we've been swindled like suckers at a sleazy carnival midway. P.T. Barnum would be proud.

The Great Prevaricator Remembered II: With Reagan Policies, Seldom Has So Much Harm Been Done To So Many By So Few (Plus Swipes At Phil Gramm)

By MANIFESTO JOE

With news of a Bush/Treasury/Federal Reserve bailout of mortgage giants Fannie Mae and Freddy Mac, I'd say it's unofficially official: Reaganomics, and the 30-year era of helter-skelter deregulation that came with it, is at long last dying for good.

No, it's not dead yet. I think terminal brain cancer is a certain diagnosis. Yet Reaganomics lingers, having been reanimated repeatedly from the dead. But I don't think another long-term resurrection is possible.

And as the details of a massive bailout emerge, the person who comes to my mind is that turkey-necked geezer who presided over the first "great" round of deregulation during the '80s -- The Great Prevaricator himself, Ronald Reagan.

Reagan survives largely just in right-wing mythology. But some of his soldiers, who helped him construct this sturdy economic Trojan horse, are still with us. Despite a rebuke over a recent gaffe, former GOP Sen. Phil Gramm of Texas, deregulator extraordinaire, is still John McCain's economic adviser.

Gramm, a Texas Aggie economist (Know how to spoil an Aggie party? Flush the punchbowl), earned his bars in the "conservative" movement as one of The Fibber's hardiest point men. He started in the House as a major architect of the 1981 tax cuts that, first, handed a bonanza to the wealthiest Americans. Then, those cuts plunged the federal budget so deeply into the red that piecemeal tax increases had to be sneaked past the public for many years thereafter to slow the hemorrhaging.

He was also a player in the '80s deregulation of savings and loans, which ultimately opened them up to full-scale looting. It took years, and many, many billions from the taxpayers, to clean up that mess. (Sound familiar now? To paraphrase the poet Santayana, our leaders did not remember the past, and we are ALL condemned to repeat it.)

Near the end of his venal "service" in the Senate, Gramm was a towering figure in the second "great" wave of deregulation. This from Wikipedia:

Later in his Senate career, Gramm spearheaded efforts to pass banking reform laws, including the landmark Gramm-Leach-Bliley Act in 1999, which modernized Depression-era laws separating banking, insurance and brokerage activities. Between 1995 and 2000 Gramm, who was the chairman of the U.S. Senate Committee on Banking, Housing, and Urban Affairs, received $1,000,914 in campaign contributions from the Securities & Investment industry.

Here, "modernize" means that the bill Gramm co-sponsored repealed certain New Deal-era regulations of the Glass-Steagall Act of 1933, which had helped keep those pillars of high finance separate, and hence relatively honest and solvent, since the '30s.

Not content with leaving only this much damage imminent, Gramm helped pull off a major deregulatory coup the following year. More from Wikipedia:

Gramm was one of five co-sponsors of the Commodity Futures Modernization Act of 2000, which critics blame for permitting the Enron scandal to occur. At the time, Gramm's wife was on Enron's board of directors.

A big part of the CFMA was what became known as the "Enron Loophole." Again, Wikipedia:

The CFMA has received criticism for the so-called "Enron Loophole," 7 U.S.C. §2(h)(3) and (g), which exempts most over-the-counter energy trades and trading on electronic energy commodity markets. The "loophole" was drafted by Enron Lobbyists working with senator Phil Gramm seeking a deregulated atmosphere for their new experiment, "Enron On-line." ...

The legislation was passed by the Republican controlled Congress and signed by President Bill Clinton [ouch --MJ] in December 2000 to allow for the creation, for U.S. exchanges, of a new kind of derivative security, the single-stock future. An attempt to reverse this policy was vetoed by President Bush in 2008. Several Democratic Legislators introduced legislation to close the loophole from 2000-2006, but were unsuccessful due to Republican control of the House and Senate.

So, in the ensuing years, Phil acquired a succession of nicknames, including "Enron Phil" for the CFMA, and recently "Foreclosure Phil" for his banking "modernization."

For more on the extent of the profound injuries that then-Sen. Phil Gramm personally inflicted on America, click here for a Joe Conason article in Salon.

But enough with beating up on a now-obvious sleazebag operative like Gramm. Let's go back a generation, and longer, to that moth-eaten spirit ultimately behind the Enron accounting scandal, and behind what is becoming known as the Panic of 2008. It's that mythical right-wing figure, the man Gore Vidal once perceptively described as "grandmotherly": Reagan.

The Sixties spawned a unique cast of characters who lingered and did their dance macabre across our collective unconscious, on their way to oblivion. The same seems to be happening with the malefactors of the Eighties, the Armani-clad hooligans of the Reagan era.

They seem determined not to go away completely, at least not right away. But I foresee a day when they will be like withered cranks at small-town school board meetings, voted out of office but showing up in enfeebled bids to harass those who replaced them. An effectively permanent death seems at hand.

Going back to the Fannie Mae/Freddy Mac bailout -- and perhaps forward toward many more -- here are a couple of especially significant quotes from The New York Times on this story:

The companies, known as government-sponsored enterprises, or G.S.E.'s, touch nearly half of the nation's mortgages by either owning or guaranteeing them, and the debt securities they issue to finance their operations are widely owned by foreign governments, pension funds, mutual funds, big companies and other large institutional investors.

G.S.E. debt is held by financial institutions around the world, Mr. (Treasury Secretary Henry) Paulson said in his statement. Its continued strength is important to maintaining confidence and stability in our financial system and our financial markets. Therefore we must take steps to address the current situation as we move to a stronger regulatory structure.

"... a stronger regulatory structure"? This from a Bush Cabinet member?

R.I.P., Ronnie Reagan. (And Phil Gramm?)

Manifesto Joe Is An Underground Writer Living In Texas.

The Great Depression of 2008

By MARC McDONALD

Until last week, most economists were divided on whether the U.S. was in a recession or not. Now, with the ailing mortgage agencies Fannie Mae and Freddie Mac on the ropes, it's clear that what's unfolding is far worse than any recession.

As Britain's normally staid The Telegraph newspaper notes, the U.S. could be on the verge of a new Great Depression. That might seem far-fetched until you consider that last month, the Dow suffered its worst June since 1930.

But The Telegraph is hardly alone in using such apocalyptic language these days. The "D" word is starting to be mentioned more and more in the business media, as well as by economic commentators. As David Bullock, managing director of investment fund Advent Capital Management, put it in a comment to The New York Times on Tuesday, "We are closer to the Depression scenario than not."

Yes, a real Depression, complete with tent cities now springing up in what once were prosperous suburbs.

This doom-and-gloom language in describing the U.S. economy first began to pick up steam after investment bank Bear Stearns had to be bailed out by the government in May. In describing the bailout, the Associated Press said that Bear Stearns was "On the verge of a collapse that could have shaken the very foundations of the U.S. financial system."

The current crisis with Fannie Mae and Freddie Mac is infinitely larger than Bear Stearns. The two companies either hold or guarantee a staggering $5.3 trillion worth of mortgages. Indeed, the investment magazine MoneyWeek has noted that the crisis is big enough to doom the dollar.

As MoneyWeek notes:

Fannie Mae and Freddie Mac might have been deemed too big to fail---but who's big enough to bail out the U.S.? When investors start seriously asking themselves that question, expect the dollar to plunge.

Make no mistake, a catastrophic U.S. economic collapse is on the way. Such is the inevitable fate of any Ponzi scheme economy that has been running on nothing more than smoke and mirrors (and oceans of foreign capital) now for many years.

Of course, those who are poor or working class know first-hand that the U.S. economy has been in increasingly serious trouble since around 1980. Wages have been steadily declining for everyone but the very rich. And working class people now toil more hours for less pay than their counterparts in any other First World nation. (They have to, as a 40-hour workweek no longer is enough to put groceries on the table).

But as long as America had a tiny elite of prosperous super wealthy, we could always point to them and try to convince ourselves that our economy couldn't be all bad. After all, we would note, there are some people out there making a fortune. All it takes is hard work and ambition, right?

Today, with the stock market in the toilet, and the Fed having to step in to bail out the financial sector, it should be clear to anyone that the U.S. economy is in crisis.

If the U.S. economy actually produced anything of value, this would be nothing more than just another typical downturn in the economic cycle.

The problem is, the U.S. economy no longer produces anything of value. Our economic activity basically consists of importing trillions of dollars from central banks in East Asia---which we then use to prop up our Ponzi scheme economy. The ocean of foreign capital that flows into our nation daily is used to pay for the shopping habits of U.S. consumers.

In fact, in recent years, the Great American Consumer has been hailed by U.S. economists as the "locomotive" of the world economy. There was only one problem: U.S. consumers had zero savings and were depending on foreign capital to finance their shopping binges.

Now, with the stock market crisis and the ongoing housing mortgage crisis, nobody is in much of a mood to do any spending these days. And with the dollar rapidly declining, it's only a matter of time before the East Asian central banks start to unload their depreciating greenbacks (which will accelerate the dollar's fall even further in a vicious cycle).

The frightening thing is that East Asian central banks haven't even begun seriously dumping their dollars and yet the dollar is already plunging.

And the dollar has already lost an astonishing 40 percent against an index of U.S. trading partners' currencies over the past seven years.

The key numbers which measure the current U.S. economic crisis are so far off the chart that it is difficult to even fathom them. As economics writer Eamonn Fingleton has noted, the U.S. current account deficit (the widest and most meaningful measure of our trade position) now represents an astounding 6.5 percent of our gross domestic product.

As Fingleton notes, only one other major nation has ever exceeded this figure: Italy in 1924. That was just before Benito Mussolini seized dictatorial power.

This BBC report takes a look at tent cities that are starting to spring up outside Los Angeles:

Is Dick Cheney Set To Profit From Dollar's Drop?

By MARC MCDONALD

The plunging dollar has taken a beating lately on international markets. But at least one wealthy investor may be set to profit from the dollar's decline: Dick Cheney.

Back in June 2006, Kiplinger's Personal Finance magazine reported that Cheney's financial advisers were apparently betting on a rise in inflation and on a decline in the value of the dollar against foreign currencies.

Cheney and his wife, Lynne, the magazine noted, had between $10 million and $25 million in American Century International Bond (BEGBX). As Kiplinger pointed out, the fund "buys mainly high-quality foreign bonds (predominantly in Europe) and rarely hedges against possible increases in the value of the dollar. Indeed, its prospectus limits dollar exposure to 25 percent of assets and the fund currently has only 6 percent of assets in dollars, according to an American Century spokesman."

Assuming Cheney still holds the fund, he has done well: BEGBX returned 8.3 percent in 2006 and 9.9 percent in 2007. And if he was counting on a dollar decline, of course, he's done well in that regard, as well: in recent days, the dollar has continued to plunge to new all-time lows against the euro. The dollar has also fallen to 12-year lows against the yen. The weak dollar trend looks set to continue as the Fed continues to slash interest rates.

Economists have noted that the weak dollar stems from America's titanic fiscal deficits, which have soared as a result of the disastrous Iraq War.

It's notable that Cheney once claimed that "deficits don't matter." But by banking on a declining dollar, it's clear that even Cheney knows this is bullsh*t and that deficits do indeed matter.

Stocks Plunge Again As U.S. Moves Closer To Economic Apocalypse

By MARC MCDONALD

A recent Wall Street Journal survey of economists proclaimed that the U.S. is now in a recession. The good news is that they're wrong. The bad news is that the U.S. economy is facing a meltdown far more serious than any recession.

But don't take my word for it. Consider the apocalyptic tone of this excerpt from the normally dry, bland prose of the Associated Press on Friday: "On the verge of a collapse that could have shaken the very foundations of the U.S. financial system, investment bank Bear Stearns Cos. was bailed out Friday by a rival and the federal government."

I suspect we'll be seeing a lot more apocalyptic language from the MSM in the coming weeks, as the U.S. economy starts to melt down.

And make no mistake, a catastrophic economic collapse is on the way. Such is the inevitable fate of any Ponzi scheme economy that has been running on nothing more than smoke and mirrors (and oceans of foreign capital) now for many years.

Of course, those who are poor or working class know first-hand that the U.S. economy has been in increasingly serious trouble since around 1980. Wages have been steadily declining for everyone but the very rich. And working class people now toil more hours for less pay than their counterparts in any other First World nation. (They have to, as a 40-hour workweek no longer is enough to put groceries on the table).

But as long as America had a tiny elite of prosperous super wealthy, we could always point to them and try to convince ourselves that our economy couldn't be all bad. After all, we would note, there are some people out there making a fortune. All it takes is hard work and ambition, right?

Today, with the stock market in the toilet, and the Fed having to step in to bail out the financial sector, it should be clear to anyone that the U.S. economy is in crisis.

If the U.S. economy actually produced anything of value, this would be nothing more than just another typical downturn in the economic cycle.

The problem is, the U.S. economy no longer produces anything of value. Our economic activity basically consists of importing trillions of dollars from central banks in East Asia---which we then use to prop up our Ponzi scheme economy. The ocean of foreign capital that flows into our nation daily is used to pay for the shopping habits of U.S. consumers.

In fact, in recent years, the Great American Consumer has been hailed by U.S. economists as the "locomotive" of the world economy. There was only one problem: U.S. consumers had zero savings and were depending on foreign capital to finance their shopping binges.

Now, with the stock market crisis and the ongoing housing mortgage crisis, nobody is in much of a mood to do any spending these days. And with the dollar rapidly declining, it's only a matter of time before the East Asian central banks start to unload their depreciating greenbacks (which will accelerate the dollar's fall even further in a vicious cycle).

The frightening thing is that East Asian central banks haven't even begun seriously dumping their dollars and yet the dollar is already plunging.

The key numbers which measure the current U.S. economic crisis are so far off the chart that it is difficult to even fathom them. As economics writer Eamonn Fingleton has noted, the U.S. current account deficit (the widest and most meaningful measure of our trade position) now represents an astounding 6.5 percent of our gross domestic product.

As Fingleton notes, only one other major nation has ever exceeded this figure: Italy in 1924. That was just before Benito Mussolini seized dictatorial power.

Louis Gallois: The Triumph Of A Socialist CEO

By MARC MCDONALD

Are there any CEOs out there who aren't greedy bastards these days? If there are, they're few and far between.

Over the past quarter century, CEO pay has skyrocketed in the U.S. In the 1960s, CEOs made around 40 times what rank-and-file ordinary workers earned. Today, CEOs make over 400 times what the average worker earns. (And they keep much more of what they make, thanks to income tax laws that are vastly less progressive than they were in the 1960s).

Business schools and economists routinely argue that exploding CEO pay is "inevitable" and that it's all a normal (and unavoidable) aspect of capitalism. Titanic pay packages are necessary to attract the best talent, they argue.

But there's at least one CEO out there who defies all these conventions: Frenchman Louis Gallois, the CEO of EADS, the European defense company.

A CEO like Gallois, 64, would be inconceivable in any American corporate boardroom (where the belief that "greed is good" has been elevated to the status of a religion these days).

After all, Gallois is a lifelong socialist. He once read Das Kapital, cover to cover. He's a business leader who has earned the respect of the workers at the companies he has run (including SNCF, the French rail company). And as The Financial Times once pointed out, Gallois has "disdain for money and the trappings of power."

When Gallois was named the CEO of EADS, he insisted on retaining his old SNCF salary of $273,000/year. EADS had offered him an annual salary of $3.4 million. To this day, Gallois retains his old salary and gives the balance to charity.

Can you imagine any American CEO voluntarily accepting a $273,000 salary, when they could be earning $3.4 million a year?

These days, American CEOs are busy laying off workers by the thousands and exporting jobs overseas, and pulling down fantastic pay packages. As long as they make Wall Street happy, their creed is: screw the workers (and society as a whole). While U.S. CEOs make over 400 times what the average worker earns, in Europe that multiple is a mere 22. In Japan, the gap is even narrower: the average CEO there makes only 17 times what the average worker makes.

In fact, these days, U.S. CEOs don't even have to make Wall Street happy to rake in their huge salaries.

Take Peter Cartwright of Calpine, a maker of gas-fired power plants. In 2005, Forbes reported that Calpine's average annual return to shareholders over the previous six years had been minus 7 percent. During the same period, Cartwright pocketed an average of $13 million annually.

Getting back to Gallois. Sure, he voluntarily pockets a modest salary. But what about his performance as CEO of EADS?

As it turns out, times are very good for EADS right now. Indeed, the future looks bright for the company.

On Friday, EADS scored a stunning upset victory over its rival Boeing with a $35 billion contract to supply the U.S. Air Force with refueling tankers. The Financial Times noted that the huge contract could ultimately be worth more than $100 billion.

For Boeing CEO James McNerney, Friday's news was a crushing blow.

But at least McNerney can take solace in one thing: his titanic CEO pay package. As The New York Times pointed out in 2006, McNerney has a pay package worth more than $52 million. And you can be assured that he won't be handing the vast majority of that fortune over to charity to live on a modest salary.

Bush Budget Starves Vital Programs While Embracing Wasteful Spending

By MARC MCDONALD

George W. Bush proposed a record $3.1 trillion budget on Monday that manages to accomplish two astonishing feats. Not only does his budget produce an eyepopping $410 billion federal deficit (double that of 2007) but it ALSO manages to gut popular domestic programs, ranging from Medicare to clean water grants to homeland security to education spending.

And while important domestic programs are slashed, Bush still finds room in his budget for $70 billion for the never-ending wars in Iraq and Afghanistan. And that figure, as titanic as it is, is a ridiculously low-ball estimate of the real costs that Bush's wars will require in the future, something that even White House aides acknowledge.

There are lots of losers under Bush's budget proposal---and you can bet that none of them are America's rich and powerful. Bush's budget slashes funding for programs for low-income seniors, clean water grants, homeland security grants and poor pregnant women and their children. Education spending also gets cut, by $4 billion.

The winners in Bush's budget are (as always) the rich, as well as corporations. The reckless tax cuts for the rich remain in place (even as the nation's deficits soar into the stratosphere). And the budget continues to provide billions in corporate welfare, disguised in the form of "military spending." The budget raises military spending to inflation-adjusted levels not seen since World War II.

In fact, as NPR pointed out: "If you add up all projected defense-related spending for fiscal 2009 and $515 billion balloons to $750 billion — almost a third of all U.S. federal spending today."

Don't get me wrong: I agree that responsible defense spending is important. But that's something we simply haven't seen under this administration. Remember the $21 billion in cash that the Pentagon managed to lose without a trace in Iraq in 2003?

And this budget does nothing to reign in the corporate welfare in the form of Bush's Medicare Part D program, which has been a cash bonanza for drug corporations. (No surprise there: Bush allowed business lobbyists to create this program, which forbids the federal government from negotiating prices of drugs with the drug companies).

On Monday, Democrats slammed the Bush proposal and promised changes. But it remains to be seen whether the Dems will stand up to Bush for a change. This is something we have yet to see from the gutless and cowardly Dems.

For Millions Of Americans, Economic Crisis Is Old News

By MARC MCDONALD

Things are looking grim for the U.S. economy these days, the politicians and the MSM pundits tell us.

I'm glad they finally noticed. The fact is, tens of millions of Americans have already been living through increasingly lean times over the past decade.

It took a stock market crisis for the Wall Street crowd to finally notice that the nation's economy is going down the tubes.

But that's hardly news for millions of average American workers, who've seen their incomes stagnate since 1980.

For years, the pundits and the politicians celebrated "strong" economic growth when the rest of us were wondering what they were talking about. The pundits also cheered America's low jobless rate. But the rest of us knew it was all a sham, in an era when millions of jobs pay such low wages that nobody could possibly live on them.

Hard economic times are nothing new for the tens of millions of Americans who already work two or three jobs, just to make ends meet. Or the nearly 50 million Americans who can't afford health insurance. Or the 2 million Americans who are about to lose their homes in the mortgage crisis.

I once had a friend from Europe who came to visit me in New York City. He told me that the American economy was widely celebrated then in Europe and that many Europeans marveled at America's entrepreneurial spirit and low unemployment rate.

I explained to my European friend that although America's economy was then in the midst of what the pundits called "prosperity" and was enjoying a stock market boom, the reality was that millions of Americans were left out in the cold and were still struggling.

At the time, my friend and I were in a bustling, prosperous part of Manhattan. Looking around, it appeared that the nation was indeed economically prosperous. I then took my friend on a short tour through surrounding areas, including Harlem, Brooklyn, and Newark. My friend was astonished at the stark difference between the prosperity he'd just seen in Manhattan and the horrible, Third World-like poverty that was only a short distance away.

This episode reminds me of what is going on today. The pundits and politicians are finally starting to wake up to something that's been obvious to millions of us for years. The American economy is in the toilet.

Sure, a tiny elite wealthy class has been enjoying strong stock market gains for years. Now, they're going to have to share some of the pain, like the rest of us.

In fact, in looking at the economic hard times ahead, I think there's actually a silver lining to all of this. That is: an economically distressed America will finally be forced to end its illegal and immoral occupation of Iraq.