Fractional reserve banking explained.

On a truly terrible day for the markets I have finally happened upon a decent description of fractional reserve banking, one of the major problems with the current financial system.

I've been an occasional follower of Positive money but while their ideas seem fairly decent their videos are terrible.

Happily the Zeitgeist Movement of all things have made a very good lecture about it.


Towards the hour mark things go off the rails slightly but it is consistently a sound analysis of a barely known issue. Their proposed solution is... less sound, being a kind of magical technical centrally planned economy. Though as the guy giving the lecture points out at the end, the current system is way more absurd than that.

Oh and in another unexpected turn arch-conservative David Frum has kinda almost paid Paul Krugman a compliment and again here. We are living in strange times.

Defaultgeddon: More good articles

The articles I post here pretty much show for certain that there wont be a default but still, for ease of lumping the topics together I've kept the same title

Yesterday I posted a short FAQ that was one of the best explanations of the debt ceiling farce so far. In a discussion on Buzz I was caused to ask if there are any longer form articles that give a description of a similar quality. Thanks to a mix of hanging out in a Something Awful thread and checking various sites I regularly do a day later I have an embarrassment of riches on the subject.

This fairly short article by Dean Baker explains how the debt ceiling arguments are just being used as a cover by both Republicans and Democrats, especially Obama, to force austerity measures on America and gut Medicare, Medicaid and Social Security at the behest of their corporate overlords.

Given the stealth Bi-partisan support for this Americans really are screwed.

Michael Hudson has written a longer piece that focuses on the great amount of effort Obama has put in to destroying as much of FDR's legacy as he possibly can.

Speaking of FDR, Richard D Wolff has written an article examining the nature of the Keynesian softening of Capitalism that was required to save Capitalism. Essentially the Welfare State and the New Deal were part of a system to keep Capitalism going and protect the rich from popular anger when the system is experiencing one of its' major crisis. However in order to maintain this buffer and protect the rich governments incurred greater deficits because the rich and powerful didn't want to pay the tax necessary to maintain it. Now public debt has gotten so large the elite want deficit reduced. Thus the buffer that keeps people relatively safe and relatively quiet is being removed. Interesting times loon.

Defaultgeddon: a couple of points.

Firstly I would like to thank Amber for bringing something important to my attention. I had assumed renaming welfare programs as "entitlements" had been a slow creeping shifting of the narrative. Amber however pointed out the shift has occurred very rapidly only starting earlier this year with Paul Ryan's slash and burn budget. And I quote:

first instance of "Roadmap for America" plan being introduced: May 21, 2008 with a revision in January 2010.
check this google trends data:
http://www.google.com/trends?q=entitlement&date=all&geo=usa&ctab=0&sort=0&sa=N
Talk about controlling the narrative...

It is pretty terrifying how much and how rapidly the right wing control the narrative.

Secondly I found this LA Times article that sums up how much damage the Gang of Six proposals and other compromises Obama is willing to back will do to America. He really has sold us down the river.

As an aside there is an article by Jeffrey Sachs doing the rounds at the minute explaining why America is in such a bad state and it is fairly trenchant but thanks to someone in the comments (comments are weird like that, a lot of dross and then some very worthwhile stuff) pointed out Sachs is one of the creators of shock doctrine and was personally responsible for turning Russia into the Oligarch run hellhole it is today.

There are a lot of false friends out there.

Pressure on Peston and News Corp Counter-Intelligence hacking.

Tom Watson MP, one of the two Labour MPs who have been pushing for greater scrutiny of the phone hacking scandal for years has become the first prominent person to openly call out Robert Peston as a News Corporation patsy.

He is "close friends" with Will Lewis, who was Rebekah Brooks' deputy until she stepped down. He also broke the story the Telegraph sting operation on Vince Cable (the business secretary) had revealed Vince Cable was openly opposed to Rupert Murdoch gaining control of BSkyB. Cable was overseeing the merger at the time , the Telegraph realised what a boon this would be for Murdoch and kept it quiet, Peston broke it and got Cable removed from overseeing it.

He was also at the Chipping Norton set party just hours before the Milly Dowler story broke.

True to form when two prominent ex-News International employees accused James Murdoch of lying in his testimony to the select committee this Tuesday Peston broke the news a low level editor who'd been in his job only six months had been fired.

This lead Watson to attack Peston on Twitter:

Watson accused Peston of being spoon fed stories by News International to distract the public's attention from the more dramatic development about James Murdoch's evidence to parliament.

Watson tweeted: "Why Sun story now @Peston? More spin to deflect Myler/Crone statement? Where's your dignity?"

Peston responded: "@tom_watson Tom, this is an outrageous and untrue allegation."

Watson shot back: "I'm sorry @Peston but you are being spoonfed stories. The Myler statement creates a crisis at NI. You have form. Stop being a patsy."

To which Peston replied: "@tom_watson That is not worthy of a response."

Nice to see Peston is following the standard News Corporation line of pretending there is no crime to answer for.

In addition News Corporation have plumbed yet deeper depths, BBC's Newsnight have accused the News of the World of hacking the phones of three lawyers for phone hacking victims.

11.27pm: Three solicitors representing phone hacking victims were themselves targets of the News of the World, according to Newsnight. They included Mark Lewis, the lawyer for the family of Milly Dowler and Gordon Taylor, the former head of the Professional Footballers' Association. The programme reported that the solicitors were not put under surveillance for the purpose of writing stories about them.

Which strongly implies News Corporation were running counter-intelligence against hacking victims, either trying to find out legal information to undermine the victim's cases or blackmail material to make the lawyers back off. By God these motherfuckers are dirty.

Murdochgate = Watergate?

The Guardian's John Harris has written an article looking at how Murdochgate has unmasked the UK's political elite and how it will affect civil society in the future. I highly recommend you read this.

As the title implies I want to look at his allusion to Watergate at the end impacts things. First of all I want to direct you to a piece Noam Chomsky wrote in 1973, when admittedly the Watergate scandal had been running a bit longer (but then again info moves much faster now) but it is still very much a contemporary assessment. While Chomsky doesn't specifically predict the moral majority and Reagan, which Harris highlights as a key outcome of Watergate, he does accurately predict an increase and entrenchment of executive power over other branches of the US government.

There are also strong elements of Chomsky's main criticism, that Nixon was punished not for wrongdoing but for breaking the rules. For upsetting the cosy elite. In a similar sense Murdoch is receiving so much criticism because he used his influence to sway the political parties to do his will. This is not right, the press exists to influence the masses, to manufacture consent on issues the elite have already agreed upon. Even then it was only the revelations such as those about Milly Dowler that gave politicians enough cover to act in their own interests and take down Murdoch. Indeed Murdoch's strong connections to the elite before the past two weeks and even now is not a particularly large issue, other media groups seem to tacitly accept that influence and connection to the rich and powerful is a good thing, they were more jealous that they didn't hold as much power as Murdoch than worried about such close links between power and the fourth estate.

Finally to quote a paragraph of Chomsky's:

"Still more cynical is the current enthusiasm [from the media] over the health of the American political system, as shown by the curbing of Nixon and his subordinates, or by the civilized compromise that permitted Nixon and Kissinger to kill Cambodians and destroy their land only until August 15, truly a model of how a democracy should function, with no disorder or ugly disruption."

We are seeing a similar compartmentalisation of Murdoch's wrongdoing here, it is a British problem, it is a problem only with his papers, the TV arms of News Corporation in the UK and US is seperate and shouldn't be blamed. Close ties to a media oligarch by politicians in both main parties are seen as a sign of shame but not an indictment of the British political system as a whole.

The myth is still being maintained that this is a scandal that can be dealt with by the political class even though it is the creation of the political class. Removing Murdoch's influence removes an especially egregious symptom but it certainly does not cure the disease.

Obama, the Tea Party President.

Reading a couple of articles today I am becoming increasingly pessimistic about that a compromise on raising the debt ceiling can be reached (I am, of course, wholly pessimistic about what the content of any possible compromise would be).

This first article by a hedge fund manager who seems to at least pay lip service to being liberal gives this entry its title, examining how Obama increasingly seems to agree with the Tea Party on savage cuts. Now this would seem to suggest a compromise is more likely, not less, but as I have argued with Tony, who is clearly vindicated by this piece, it isn't Obama so much as Democratic legislators that are an obstacle to total GOP victory on this issue.

Obama's seeming desire to gut Medicare, Medicaid and Social Security is so unappealing to the voters that the selfish pragmatism of many Democrats will prevent them from agreeing to a capitulation. Defending these three broadly popular programs is a big vote winner, attacking them is a vote loser as Paul Ryan learnt a couple of months ago.

Further at this piece by Will Hutton asserts, basic human interaction requires some give and take. For reasons of pride and for the ability to tell angry constituents they at least put up a fight Democratic legislators may not be willing to throw cherished welfare programs under the bus. Even if Obama explains in a soaring and wondrous speech why the poor should go die in a fire and why people under the age of 55 expecting to retire at some point are unreasonable.

But while it will be the political reality of legislative politics that prevents absolute capitulation by the Democrats it is Obama who is preventing any other outcome. If he had fought for anything near a middle ground rather than agreeing to make major concessions on social programs on day one then there would be some impetus for compromise, something for Democratic legislators to hang their hats on and, much more importantly, an opportunity for more moderate House republicans to push for compromise too. Sure the Tea Partiers are happy to drive straight off the cliff but older GOP hands will probably not want to see the end of the American empire, even if only social programs and civilian jobs are lost following a default with more expensive credit the American war machine is that much harder to maintain.

There are other signs a default is becoming a more likely scenario. A look at the business press, Fox News and others shows you the increasing suggestion that a default wouldn't be so bad. Some people have taken away from this the belief that big business and the super rich want a default. This is highly unlikely, I mean they'd be better off than the rest of us sure but the potential upheaval is unlikely to be appealing to them.

What instead this "default aint so bad" rhetoric is for is a form of spinning a very bad scenario into being Obama's problem. You plant the seed that a default really need not be that bad if you're smart, you're competent and then when the inevitable major problems occur you scream as loud as you can it is Obama and the left's fault for not being competent. Thus you attempt to shift the blame from the debt ceiling debate, where GOP intransigence might get blamed to it being wholly an issue of presidential control. Default as a controllable thing gone bad lays the blame solely at Obama's door.

Still given I don't think anyone beyond the Tea Party really wants default the fact the business press have shifted from trying to prevent a very bad thing to damage control on that very bad thing is not a good sign. Of course maybe the rich will profit from a default in a way I don't understand or perhaps the business press are just idiots, both are entirely plausible.

I still think there is a very good chance we'll get some kind of settlement on the debt ceiling before August 2nd but I will reiterate that the mainstream view that there is nothing to worry about is incorrect. We'll have to see I suppose.

US coverage of Murdochgate so far.

Someone in a comment thread on the Guardian website suggested the scandal be called Murdochgate and I think it fits rather well.

Rumour has it the NYT has a scoop on the phone hacking of 9/11 victims and their families that will break tomorrow. In which case it seems likely the story is about to become at least somewhat more prominent in the US. So pointing out this comparison Media Matters made of CNN, Fox and MSNBC's coverage of the issue seems rather timely.

Oh and courtesy of Jonny here is a sample of Fox News' coverage of the scandal:

Further developments in the News Corp. crisis.

The Guardian has revealed that in late 2009 and then in late 2010 the Metropolitan Police tried to pressure them away from investigating phone hacking. It is very much worth reiterating that during that specific period Neil Wallis, the now arrested former executive editor of the News of the World was working as an "advisor" to the Metropolitan Police.

The second piece I want to draw your attention to isn't so much a development as a summary of the first ten days. Johnathan Freedland looks at what has happened so far and what the aftermath may be. It raises the very real possibility that as with the credit crunch and the MPs expenses scandals the aftermath of this wont be any real change. Nonetheless though it is a worthwhile summary of the spirit if not the details of what has happened so far. It also points out a very important point it has been easy to miss:

One aspect of this British revolution sets it apart. Normally, people know how they are governed long before any change in the system happens. It did not take the Arab spring to teach the people of the Middle East how they were ruled. But in Britain there has been a degree of shock as the curtain was suddenly pulled back, revealing exactly how Murdoch has operated these last 30-plus years.

A great point that raises a scary question, if you don't know who is oppressing you how can you revolt against them?

Europe's sweaty palms moment

I would argue that while the EU's problems are potentially much worse than those of Americas, there is greater scope for action while the intransigence of the Tea Party refusing to raise the debt ceiling could end the dollar's status as the global reserve currency and that really could be catastrophic for America. Hence sweaty palms rather than pooey pants

Sauce for goose is sauce for gander so here is an excellent article regarding Europe's debt problems. While the short term solution to the EU's problems aren't quite so simple as just raising an arbitrary cap on borrowing it would seem the self interest of German elites and to an extent German voters could badly harm the EU just as Tea Party self interest could badly harm the US.

The article also highlights the growing sense of lacking economic agency most citizens of Europe have. The flip side of the coin is the assertion of the elites and their lickspittles that essentially democracy works and thus it is everyone's fault and everyone has to face the consequences of that. The contrast of the self congratulation elites chorused when things were going well to this egalitarian approach to blame is probably the most crass case of "socialise the risk, privatise the reward" I have yet to see. Still the way things are going I doubt this is the most egregious case we're going to see.

One complaint I have about the article (and something I hope Tony will comment on) is that it fails to mention the nature of the Euro as a currency peg rather than an actual currency. There is no central control mechanism for borrowing (or at least there wasn't, I don't think this has changed but it might've) so countries like Greece could use the value of the Euro as imbued by big economies like France and Germany to borrow on much more favourable terms than their own economies would allow. That is to say Greece could borrow with Euros but was only able to pay back in (metaphorical) Drachma.

I really hope there is a reason other than cynical self interests that such a glaring oversight was made in the creation of the single currency.

Tony's Response
"For the most part you're correct, but it's important to note that while there is a single currency, the mechanism by which sovereign debt is accrued varies by state and unlike the US there isn't a single entity who can reign it in.

The question the Euro sought to answer was "can a unified currency work with a bunch of different entities essentially managing the back end?" As France and Germany will likely find out, they're going to be footing the bill for every country that doesn't have enough cash to meet its obligations. Either they do it or the currency itself gets weakened in ways that no one can really predict. Right now things aren't so bad, but if Italy goes or Spain, well, that's going to be the test because at a certain point the Germans aren't going to be able to keep up with large but faltering economies.

Within a country, sovereign wealth generally has to support the weaker, depressed parts of the country. That's just the way it has to be. In the Eurozone it's difficult to see how that's going to fly when the wealthier countries aren't responsible for and don't answer to the weaker countries but still have to act in a way that primarily funnels money to the countries that need it in order to support the entire system.

This is uncharted territory, really. There isn't any historical data on how this will play out to my knowledge, but my guess is that France and Germany won't be able to shoulder the burden for long and something will have to give either politically or economically. It's worth watching.

(FWIW Europe isn't worse off than the US economically, but the political realities involved will likely create a crisis in Europe before the US. The US has the benefit of simply being able to falter on it's own rather than having disparate parties who could precipitate collapse by actions that they might not be able to avoid. Europe's situation is definitely better overall when looking at the numbers and they're willing to address the actual balance sheet problems whereas the US simply never will, but the uncertainty over how Europe will play out makes it riskier now than it is in the US.)"

News Corp corruption news!

(almost a palindrome)

A couple of stories worth pointing out:

The former executive editor of the News of the World was arrested today. Oh and he happened to be a consultant hired by the Metropolitan police to advise the Commissioner and Assistant Commissioner John Yates, the officer in charge of investigating phone hacking. Oh and he just happened to be advising them on "stuff" over the period back in 2009 when the Met decided there was no need to investigate phone hacking further.

All perfectly innocent I'm sure.

Secondly Rupert Murdoch gave the American Chamber of Commerce $1 million to lobby to weaken the Foreign Corrupt Practices Act, the very act he may now be charged under over events in the UK. Theres also a picture of Elliot Spitzer because it is all but inevitable he is going to try to link his own downfall with other invasions of privacy of the rich and powerful probably as a springboard back into politics. After his shameful defence of the IDF's illegal boarding of a ship in international waters and the murder of nine passengers I can't say I view that as a good thing.

Oh just noticed this on the live stream from the Guardian (where else?) and it is probably worth pasting:

PA has published a list of the menbers of the Commons culture media and sport committee who will grill Rupert and James Murdoch and Rebekah Brooks at next Tuesday's hearing:

• Chairman John Whittingdale is a senior backbench Conservative. He quit his job in the City to work as an adviser to Margaret Thatcher in the 1980s.

• Tom Watson, Labour, took News International's Sun newspaper to court and won after it ran stories claiming he had been involved in a campaign to smear the Tories.

• Louise Mensch, Conservative, a "chick-lit" novelist, claims she has been "threatened" before by a national newspaper journalist.

• Philip Davies, Conservative, is a rebellious backbencher who is outspoken on crime and immigration.

• Therese Coffey, Conservative, was finance director for Mars Drinks UK before being elected last year.

• Damian Collins, Conservative, worked at Saatchi advertising before setting up his own marketing firm.

• Paul Farrelly, Labour, admitted last year he "wrestled" a man to the floor in a Commons bar "entirely in self-defence".

• Alan Keen, Labour Co-operative, is chairman of the All Party parliamentary football group and once worked as a tactical scout for Middlesbrough football club.

• Adrian Sanders, Liberal Democrat, is a keen campaigner on animal welfare issues.

• Jim Sheridan, Labour, a former trade union convener and chairman of the All Party parliamentary Scottish football group.

The Guardian reviews the Metropolitan Police's position.

I was somewhat unsure what was happening regarding the Home Affairs Committee interviewing four senior police officers yesterday. The Guardian has clarified things somewhat.

For reference those police officers were: Metropolitan Police Assistant Commissioner John Yates, Peter Clarke; a retired Deputy Assistant Commissioner with the Metropolitan Police, Andy Hayman; a retired Assistant Commissioner with the Metropolitan Police and Deputy Assistant Commissioner Sue Akers, currently heading Operation Weeting, the ongoing investigation into phone hacking by the News of the World.

Nick Davies who is one of the main Guardian journalists behind their investigation into phone hacking has made a video summing up what happened.

Meanwhile Simon Hoggart further puts the boot in for Andy Hayman.

However it is worth bearing in mind that the man heading up the Home Affairs Committee, Keith Vaz has a fair amount of association with corruption himself.

Sir Hugh Order of the Association of Chief Police Officers (ACPO), which in spite of its' name is a wholly private company with no attachment to the state, has also criticised Mr Hayman. One has to assume Sir Hugh and ACPO are bristling at someone else horning in on their undermining people's privacy. and example two

But hey in the midst of all this at least our noble law enforcers are marching against deep cuts to public services. So at least in this we can stand in solidarity with these peo-

We accept that cuts have to be made but we ask that the government acknowledges our unique status.

Oh. So cuts to public services in general are fine, just not to their wages. What a fine bunch the British police are.

Automation: A massive problem mostly ignored.

Yesterday I posted about the singularity and how it seems to be a front for exceptionally unpleasant people. In the process of looking into that Martin Ford and his book "Lights in the Tunnel" was mentioned a lot on Wikipedia (I think he was stealth advertising) and it raises a problem that I'd been kind of hazily aware of, not least because of a Paul Krugman article I read last week.

The essential idea Ford (and others) puts forward is that with improvements in technology and increasing automation an increasingly large sector of the economy will not require human workers at all. While this has already happened to an extent automation up to this point has mostly complemented human workers, that is to say labour saving devices meant fewer employees doing more work and other jobs created by the technology taking up the slack. Well for the past couple of decades that slack has been taken up by the service sector. The bad news is automation of the service sector seems to be imminent, with self service checkouts and Online shopping we are already seeing the beginnings of this. In a piece written a few years ago (so it sadly doesn't cover the most recent financial crisis) Marshall Brain wrote a piece detailing how rapid and large scale automation of the service sector is likely to be.(Marshall Brain is the founder of HowStuffWorks.com with a surname like that I suppose it was inevitable)

Something he highlights, which in retrospective seems painfully obvious, is the existence of Jobless Recoveries. Traditional economists have explained away improved growth alongside continuing unemployment because jobs are apparently a "lagging indicator" but it would seem increased automation would explain this equally well if not better. Ford notes that offshoring is linked to automation, deskilled jobs and computers / high bandwidth long distance communication allow jobs to be much more easily exported to places where labour is cheapest. However with automation seemingly poised to replace these jobs altogether it seems China and India's current economic booms may be shortlived.

The general way of things up to now, or at least up to recently, has been that as automation has eliminated some jobs the slack has been taken up elsewhere but as Brain points out (scroll down to "Creating new jobs") there seems to be little place for new jobs to be found, Ford argues an exception is Green Jobs and building a renewable energy infrastructure but even that is short term, once its built the new of jobs required to maintain it will not take up anywhere near all the slack. Worse still even in the near term it wont just be low skilled jobs that will be automated, as mentioned in Krugman's article above and by Ford in an excerpt from his book.

This leads to two possible scenarios, the more optimistic one being that the massive efficiency increases of robotic labour are shared with the general population and the large numbers of people placed into long term, or likely lifelong unemployment are given a decent standard of living funded by the massive surplus robots can create. This is potentially possible and I'm inclined to believe that to some extent the Middle Eastern and now Spanish uprisings are the first wave of backlash against economic automation. The truly massive levels of youth unemployment, Spain has a Youth unemployment rate of 45% are leading to the young taking to the streets and demanding change. They may not get it but it is a potentially hopeful sign.

The less optimistic scenario is much less optimistic. The evidence of US wages being stagnant since the 70s would suggest the benefits of automation and increased efficiency have flowed solely to a very small part of the population who are at the very top of the pile. Without intervention automation, with massively reduced labour costs and no wages going to an increasing slice of the population, the rich will get even richer even faster. We have seen evidence for this in the aftermath of the 2008 crash with Billionaires getting much richer even as the rest of society faces financial crisis and austerity measures. Indeed austerity measures are a good example of this trend, with the poorer in society becoming worse off even as the amount of wealth in society increases. Then you have movements like the Tea Party wanting to cut Medicare and privatise social security, this does not bode well for a future American society looking after the permanently unemployed.

Indeed, as an increasingly large amount of the population becomes essentially surplus social unrest could well increase. This however may not happen due to increasingly powerful surveillance systems in the West being used to prevent organisation and action. While western troops / police might not fire on civilians (the 2008 RNC Protests suggest that they might well do so) Blackwater / Xe mercenaries and automated drones definitely would. The counter to this is a probably vain hope the human elements of the military (if they existed) would revolt if this happened. Thus there is something of a timelimit, once humans have been removed from military and policing operations (if that is indeed possible) the super wealthy minority would likely be utterly secure and looked after by automated systems and robotics. This in turn could lead to a slow genocide as the majority of the population were left to starve to death or perhaps even a more rapid active genocide.

Three things are factors in this happening. Firstly there is the speed and range of automation, if for whatever reason important parts of infrastructure can't be automated or automation is slow allowing things to build to a head a more egalitarian distribution of the benefits of automation may occur. Secondly there is the issue of Awareness if people become aware they're likely to be out of a job permanently in a decade they may well start to look to softening their landing before they become powerless. This is likely why there is no mention of automation in the mainstream media. Thirdly there is the possibility of robotic efficiency being so great that it is inevitably shared more widely. This a very optimistic scenario but there may simply be an upper limit to what the tiny elite can use and control meaning the crumbs left to the rest of society are big enough to allow the global majority to lead decent lives. I certainly wouldn't count on it happening but it is possible I suppose.

I think point two has the most potential to avert catastrophe for the majority which is why I'm going to make a request of you. Spread the word about this. You need not link my blog post, just cherry pick links or even just explain it to people you know. This is seemingly a major factor in the current state of things and yet no one is talking about it, not even dedicated left wing media outfits. People need to know this stuff.

Here are a few key conversation points:
1)Jobless recoveries amid continuing growth.
2)Robots in the service sector, especially self service checkouts, What will replace those jobs?
3)Krugman and Ford's point about higher skilled jobs such as radiology being replaceable.
4)If those jobs can't be replaced what on earth is going to happen?

Spreading the word as widely as possible can only be a beneficial thing.

I forgot to work this into the text but Jeremy Rifkin also covered this topic in The End of Work but I can't find much to cite from this but still, worth knowing about if you're interested in the topic.

The Singularity movement as Eugenics 2.0

With the total failure of the May 21st rapture to come to pass I decided to have a look at the atheist/nerd version of the rapture, that is the Singularity and while I am in no position to judge how plausible it is I did notice something odd. A lot of the people who are ardent believers are noticeably right wing. Vernor Vinge, the guy who coined the term Technological Singularity is an Anarcho-capitalist. Another prominent speaker in the movement, Robin Hanson is a professor of economics at George Mason University (a Koch Brothers controlled institution) and his views on the economics of the Singularity is very much along Libertarian lines. Then theres the corporate sponsorship of the Singularity University which according to wikipedia: "Corporate founding partners and sponsors include NASA, Google, Nokia, Autodesk, IDEO, LinkedIn, ePlanet Ventures, and the X-Prize Foundation."

This seemed odd to me hey, nerds tend to libertarians and heck corporations sponsor everything these days. However while drifting around Wikipedia trying to get a better insight into the whole movement I was lucky enough to stumble upon a brief mention of David Correia as strident critic of the movement and a footnoted link to this Counterpunch article which expands greatly upon what had caused me to be suspicious and highlights links to US military funding via DARPA. At the very least this article makes a strong argument for much greater suspicion about the movement and its' actual, rather than stated, goals.

http://www.counterpunch.org/correia09152010.html

Glenn Greenwald Q&A at Brown

I admit I am somewhat schizophrenic about Glenn Greenwald praising him one minute and questioning him the next but he seems an odd mix of genuine concern about civil liberties and still thinking the CATO institute is pretty good (he tweeted about a drug conference there the other day).

Nonetheless this lecture and Q&A is very good. In the lecture part he does cover some old ground so if you're pressed for time skipping to the Q&A bit at around the 50 minute mark may be worthwhile.

Bill Gates: Liberal Communist

please note, Zizek, as a political philosopher, uses Liberal in a very specific sense regarding Liberalism as an ideology as opposed to the much more generalised usage prevalent in the USA

This article by Slavoj Zizek is from 2006 but still makes worthwhile points about the lauded charity of men like George Soros and Bill Gates and how it is used to justify damaging and negative actions on their part. Zizek draws comparisons to Andrew Carnegie which he is right to do but I feel it is important to note the deeper roots of this practice, that of Noblesse Oblige where aristocrats for centuries have thrown the peasants a few crumbs to keep them in line.

However the key thing to remember about Noblesse Oblige is not just that it is a manipulation tactic, a damage control method, but also that it is a tactic of legitimation. The elite are right to do whatever evil they will because they know best how to do decent and good things. Or to put it another way "You lefties are just jealous of Bill Gates' success, after all, now he is rich look at all the good he is doing!" It aims to propagate the idea the general public don't know how best to improve things and that the concentration of wealth required for individuals to be able to fund grand charitable projects is desirable.

The Federal Reserve gave two Wallstreet Bankster Wives $220m

Theres no real caveats or explanations I can give, they essentially were given free money. As Matt Taibbi explains here.

Walmart shoppers running out of money.

It seems Walmart, merry destroyers of America have hit a snag in their plan. It seems their shoppers are running out of money. I'm sure the super rich Walton family will at least privately endorse a switch to labour service from the peasants. Still, I must say I'm a bit surprised Walmart didn't forsee this being a likely outcome of a race to the bottom.

Above link was found on exiledonline.com

Why the right hates the TSA

Following up on a previous article which gained the ire of Glenn Greenwald Yasha Levine and Mark Ames now give a more in depth explanation of why the negative actions of the TSA suddenly became a conservative cause celebre last year.

I don't like what the TSA does but I do not labour under any illusion that right wingers care about civil liberty issues at all. They simply would prefer to return to privatised airport security at which point they would immediately become deeply concerned about the need to maintain security, even at the cost of civil liberties if necessary.

This is just another issue of shooting the messenger. The people who work for the TSA deserve decent working conditions just like everyone else. Yes they are the ones on the front line doing embarrassing and unpleasant things to everyday air travellers but they aren't the ones setting DHS policy or passing legislation that restricts civil liberties. If liberals and leftists were smart they'd direct their anger at the politicians and senior civil servants pushing these policies, not the low paid grunts on the front line.

So really do give the new article a read.

Chomsky on the Arab Spring...

...and why the west will likely stop at nothing to prevent democracy in the Arab world.

Read about it here. (Feel free to ignore that random editorialising at the start by someone else.)

Why Bill Gates and the GOP are targetting Teachers

It has been said this blog is the most depressing thing in the world excepting the stories which it covers. I am on reflection forced to admit I have nothing on Alternet. Here a contributor puts forward the convincing argument that the attacks by Hedge fund managers and the GOP on education and teachers are part of an ongoing plan to create a nation of ignorant and pliable corporate drones.

The Tory's interest in charter schools is almost certainly for the same reasons.