A Lion’s Standoff

April 23, 2014

Life’s little ironies…

“Go ahead… make my day.”

Ukraine and the Removal of U.S. Natural Gas Export Restrictions

April 15, 2014

On March 18, 2014 at 10:17 a.m., over at naked capitalism I commented on the Ukraine situation (and got clocked for it) thus:

Well, the U.S. gets a double win here, as eventually Europe will have to buy our natural gas exports (and we can legitimize our need to export), and what a great bargaining chip that becomes in forcing the EU to start agreeing to the U.S. terms on the trans-Atlantic trade agreement.

Damn, who thinks these things up in D.C.? Pure (evil) genius.

My point remains: A move to export natural gas doesn’t have to “make sense.” In her March 31, 2014 post at Our Finite World, “The Absurdity of US Natural Gas Exports,” Gail Tverberg does a great job of arguing her point against exports, but even she recognized why these efforts are moving forward:

“Why all of the natural gas exports, if we don’t have very much natural gas, and the shale gas portion (which is the only portion with much potential for growth) is so unprofitable? The reason for all of the exports is to pump up the prices shale gas producers can get for their gas. This comes partly by engineering higher US prices (by shipping an excessive portion overseas) and partly by trying to take advantage of higher prices in Europe and Japan.”

Her emphasis, not mine.

And right or wrong, the speculators seem to be onboard.

We have legal restrictions on natural gas exports in place, and the energy companies are leaning on Congress to remove those restrictions.

What better way to stir the we-need-natural-gas-export-restrictions-lifted pot than to find a bottleneck in the gas supply in a country that had a shaky political landscape (Ukraine), the help of which we could get those restrictions removed? Blunt force to remove those restrictions would not have played well with an American public that has grown accustomed to the we-need-energy meme.

Once those restrictions are removed, the carrot starts to look bigger for those trade agreements dangling over the Atlantic (TransAtlantic Free Trade Agreement, or TAFTA) and Pacific (Trans-Pacific Partnership, or TPP). Intransigent opposition to U.S. demands, from either side of those ponds, can quickly melt away when European and Asian political leaders are faced with populations growing cold over a harsh winter. Consider:

The crisis also is being used to promote a proposed trade deal, known as the Trans-Atlantic Trade and Investment Partnership, between the U.S. and 28-nation European Union.

“The recent developments in Ukraine only make it more clear why TTIP is important,” Froman said during a March 22 interview in Brussels.

(see “Ukrainian Crisis Not Wasted by Washington Lobbyists” link below for source of this quote).

While Germany and Japan rattle their sabers and threaten a return to coal power, they do so mainly as a weak attempt to counter what they know will be a choice between a) doing an about-face and return to nuclear, or b) adopt a larger share of natural gas, to counter adding to greenhouse gases during the generation of electricity. By adopting natural gas, both Germany and Japan know that road runs through the U.S., but are – at this point – unwilling to admit it for fear of the inevitable: The U.S. using its gas supply as a bargaining chip in the ongoing trade negotiations mentioned above. While the U.S. government wouldn’t restrict the flow of natural gas to these countries, they certainly have the power to control export tariff levels on gas supplies.

With slowing demand for energy due to a global economic anemia settling in, what better use of a synthetic crisis (Ukraine) to keep natural gas prices rising? Right now, with the widespread use of fracking, the U.S. is awash in natural gas, and energy companies want to get it off U.S. shores so that prices can rise, rather than falter. Never mind the transportation costs: If natural gas prices rise, the cost of developing the infrastructure to ship natural gas overseas will increasingly become a secondary, even tertiary, consideration.

Additional resourcs

This certainly adds credence to the argument that Ukraine simply became a pawn in a larger natural-resource pricing move: Ukrainian Crisis Not Wasted by Washington Lobbyists.

And there’s nothing like a crisis to keep the momentum of foreign energy companies (including the U.S.) moving towards the Drain of Spain: Foreign Frackers Now Find Comfort in Water-Hungry Spain. And Spain itself is running into trouble from its reliance on hydro-electric power, only adding to its eventual need for natural gas.

For those who find it unimaginable that stupidity runs rampant in the natural-gas sector consider this: Gas Carousel Making Spain Europe’s Biggest LNG Exporter. So do you think with this kind of mentality the LNG folks will really care if they ultimately drive up the price of doing business in the U.S.? They don’t get paid to be considerate. Besides, reflecting on the global scope of the natural-gas moves in play, it’s plain to see the powers-that-be in this sector intend to drive the prices upward on a global scale, thus not creating any cost disadvantage solely for American businesses.

A pot of gold at the end of an otherwise gray rainbow?

In the long-term, this manic drive to increase natural gas prices should spur other countries to develop alternative energy technologies, to remove themselves from the shackles of both U.S. and Russian natural gas. Perhaps, just perhaps, we’ll see the advent of a real paradigm buster with the creation of technologies that will finally make hydrogen a viable energy source, unleashing the potential of our universe’s most plentiful element.

 

Government Fleecing Shows Public Health System’s Failures

April 10, 2014

The latest round of fleecing-the-government has cropped up in the Medicare system.

What a surprise.

These newly minted millionaire doctors shows that the single-payer-system-is-Nirvana meme is nothing more than the tired flapping of gums by those who continue to believe that the Federal government can still manage its bloated bureaucracy,”if only….”

Whatever. Consider these top-of-mind failures from our Federal government. There are far more that I have forgotten:

  • SEC and other designated regulators failing to stop Wall Street banks selling crap collateralized debt obligations (those pools of mortgages that went south, the hangover from which we have yet to recover).
  • Entangling ourselves in a war we didn’t need to fight in Iraq, while taking our eyes off a war that we desperately needed to win over in the peace, i.e., Afghanistan.
  • The Bureau of Land Management, et. al., and the massive agency capture that took place, allowing oversight to look the other way while BP, et. al. built oil platforms out of Tinkertoys in the Gulf of Mexico.
  • The National Highway Traffic Safety Administration (NHTSA) whistling past the graves of those who died in GM automobiles.

Etc., etc., ad infinitum, ad nauseum.

“But wait,” you say as you attempt to register a complaint, “we have a private healthcare system that is already fleecing the government-cum-taxpayers.”

Indeed we do, but it is not a free-market system, not even close, and those hypocritical pansies who pass as CEOs of healthcare insurance firms, who will thump their chests over our need for “free markets” are the very same ones who blocked a proposal during debates over the ACA that would have rescinded state-line barriers to selling healthcare insurance everywhere and anywhere. The management of HMOs and their ilk soiled their collective pants when faced with the red-hot prospect of having to release their grip on their state-bound oligarchies.

If you want to know what a real free-market healthcare system would look like, one that would drive the healthcare profiteers into the streets weeping, then you’ll have to glance at this.

There are countries that have single-payer systems, and they work well for those countries. Not perfectly, but well. Here in the U.S., however, we are saturated with a fleece-the-government culture. Infrastructure projects cost far more than they should, as do defense procurements, healthcare systems, airway traffic systems… the list goes on.

So what part of history leads any of us to believe our Federal government is fully capable of properly managing a single-payer healthcare system?

 

The Economic Metaphors of ‘All is Lost’

March 6, 2014

Now that the hub-bub of the Oscars is over, it’s an appropriate time to examine the metaphor-laden film, All is Lost. It was nominated for an Academy Award in sound editing (but ultimately taken by Gravity), but received little attention during Oscar season. I believe the economic metaphors were recognized by the elites, and they weren’t very interested in promoting All is Lost any more than necessary.

I must provide a spoiler alert, although the film is one of those “have-to-see-it” experiences. Having read summaries before seeing All is Lost, I held some trepidation about the film, wondering if a single cast member with a dialogue-less script (there is a short voice-over at the beginning) could really pull it off.

It works. As I said, you have to see it for yourself to believe such a sparse premise can keep your attention.

However, I do not plan to undertake a scene-by-scene analysis here. The broader strokes are discussed. I’ll leave it to the viewer to fill in the gaps. And forgive me if some of the descriptions show my lack of understanding the nomenclature. Having hailed from the Midwest doesn’t lend itself to a very full education of maritime knowledge.

The economic overtures are already at a start when we learn All is Lost was written and directed by J.C. Chandor, who garnered an Academy Award nomination for best original screenplay for Margin Call, an excellent film on Wall Street’s role in the Global Financial Crisis.

The film opens with a skipper (Robert Redford) sailing solo through the Sumatra Strait (Strait of Malacca) on a 39-foot Cal Yacht, a fiberglass-hull yacht mass produced from the Sixties through the Eighties. It is not a finely crafted, custom-made vessel lovingly assembled by hand.

On the face of it, we have to assume the solo sailing effort is part of a retiree’s bucket list. Sailing where, for what distance, is left to the imagination. It matters little, for what is about to unfold negates the necessity of explaining. Yet, we have to question the wisdom of undertaking such a voyage – no matter how short – once the gaps in the skipper’s knowledge are revealed.

The Sumatra Strait connects the Indian Ocean to the Pacific Ocean by way of the South China Sea. Other locations were also used for filming, including the Caribbean, but All is Lost opens with a screen graphic that places the waters as being the Sumatra Strait. Locating the scene is important, not only for our sense of curiosity but that this strait represents one of the most critical shipping lanes into and out of China.

The film opens showing the yacht aground on a floating shipping container (one imagines the shipping container must have went overboard during a storm, although in reality I cannot fathom this happening very often but then again, what do I know about oceanic shipping?). A corner of the container has punctured the hull. This occurred while the skipper was taking a nap below deck. Water is slowly sloshing through the hull, and gear is bumping around cabinets, which wakes the skipper. Surprisingly, we find that the yacht had been under sail at the time of the unmanned collision. Why was the skipper asleep?

Redford’s character seems to represent the American worker, who was “under full sail” when the American economy was fully functioning. Becoming complacent about the economic success around him, the American worker decided to take a nap without exercising caution (lowering the sails). He runs aground on the manufacturing capacity of China (the shipping container, marked in Chinese characters).

The skipper manages to pry the hull off the shipping container, but in the act of doing so one of the container’s doors opens. He swings the yacht around to retrieve his sea anchor (a part of separating the yacht from the container), but this allows him to see what was inside: Out floats hundreds of tennis shoes, expensive at retail, but an incredibly cheap product to make in China. The shoes symbolize the sizable profit margins that can be had by corporations offshoring jobs.

The skipper doesn’t have a choice: he must repair the hole in the hull if he has any hope of reaching harbor. While he does have a fiberglass repair kit on board, it isn’t large enough to properly lay up enough fiberglass cloth to withhold the rigors of sailing at sea. We see a shot of the final repair; it doesn’t look promising. It may well be that not only is the repair kit lacking enough material, so are the skipper’s skills at rendering the repair.

The American worker recognizes the severity and significance of the damage, but he simply doesn’t have the proper tools or skills to bring his vessel safely back to harbor for a more thorough repair.

The lack of skills is highlighted elsewhere.

The onboard electronics were severely damaged as a result of the accident. The laptop looks as soggy as bread dropped in water. The skipper is on his own, reduced to surviving by his knowledge and instinct. But the skipper lacks the knowledge – or possessed the knowledge at one time but since the computer has overtaken so many of the duties for him, he no longer retains the knowledge. The skipper is forced to pull out a book on navigation, with instructions on how to use the old-fashion sextant (analog computer) and night-time sky.

There is something disconcerting about seeing the skipper pull out this book during a crisis. Doesn’t he know this? Is this a matter of too little, too late?

In a parallel manner, the American worker has forgotten the basics as well, once known or, as with younger workers, probably never learned. The American worker no longer has to think, just do as he is instructed. Few bother to check the veracity of the data spewed forth from the spreadsheet; even fewer care. Awards are not in place for critical thinking. If the internal rate of return hits the magic number, then press the “go” button, no matter the real-world environment or potential for negative externalities.

It is simply easier to keep one’s head down and do whatever is minimally necessary to keep the paychecks coming in. Not only is initiative no longer awarded, it often leads one out the door. Managers do not tolerate well the knowledgeable underling who threatens his or her job.

The remainder of the film records a slow slide into oblivion, oscillating between bad choices made by the skipper (e.g., switching to a storm jib during a storm, or removing the boards on the hatch during a storm, etc.) and the threats completely out of his control, such as the storms themselves. Little by little, the yacht is reduced to a floating hulk. The skipper is eventually forced to abandoned the yacht for an emergency raft, before the yacht finally sinks below the waterline.

Likewise, the American worker experienced a similar slide into oblivion, wrought by poor choices and larger macro events seemingly out of his control.

The skipper comes close to being rescued, not once but twice by mammoth cargo ships navigating their way through the strait. In neither instance, however, does the crew on these ships spot our distressed sailor. The sense of impending doom rises in the viewer’s throat.

The cargo ships represent our globalized economy, with an endless stream of cheap goods shoved out of China and arriving in developed economies everywhere. The very size of the ships is staggering and when one attempts to calculate just how many goods are loaded on a single ship, it is overwhelming. To completely stagger our senses, how many of these ships leave China and Southeast Asia every day?

The captains of industry are metaphorically at the helm of these ships, too busy with shipping their cheap goods into retail stores to be bothered by some American worker struggling to stay afloat. They are so taken by the size of their operations that they cannot comprehend the disconnect between the tidal wave of goods being imported into America, and how the American worker will continue to pay for them once their incomes are diminished to subsistence levels.

In the end, the skipper becomes so desperate that when he sees a faint, distant light at night, he sets his raft on fire, hoping to attract attention. The material of the raft, however, is highly flammable and ignites into a conflagration in no time. We sense that by this point, the skipper doesn’t seem to care anymore; he has resigned himself to death.

With the last glimpse of the light we see, it doesn’t appear to move.

The skipper allows himself to sink, giving up the struggle.

At the very end, when all seems lost, he sees the shadow of a vessel overhead. He frantically swims up to the waterline.

An arm reaches in, and grabs him. He is saved.

A storybook ending, after all, but is it realistic? Will some unknown rescuer reach in at the last minute and save the American worker?

And who was it that undertook the rescue in the film?

We never see.

Who could it be?

The Irony of Our Focus on Income Inequality

February 26, 2014

The growing income inequality in the U.S. disturbs most Americans, as it should. Yet the irony is, focusing on materialistic-based equalities leads us away from rectifying income inequalities. In a sure-to-be controversial paper just posted on Scribd (free for the download), types of equalities are defined, and those that matter most are discussed. This paper concludes with the argument that Americans have it within their capacity to rectify income inequalities without waiting for a governmental response that will never arrive from our current political system.

Industrial Agriculture Castrating Sustainable Agriculture

February 25, 2014

For some time I have been at odds with fellow sustainable agriculture supporters over the seemingly singular obsession of the movement with Genetically Modified Organisms (GMO). GMO crops are hybrids on steroids, with the genes being manipulated in the lab rather than the old-fashion cross fertilization of plants.

GMO crops may indeed pose a real threat to human health, I’m not denying that possibility. But the problem with attacking GMO crops is the dearth of research out there that upholds our fear of GMOs. A nascent growth of research is emerging from Europe that starts to peel back the Secrets of GMO, since governments there fund the research. Here in the States, however, the state of GMO research is left wanting. Most U.S.-based research at the university level is funded by corporations or private organizations backed by corporations. The corporations that stand to profit from GMO crops represent a massive resource for university-research funding, so guess what the research findings reveal? Largely positive findings in favor of GMO crops.

Until a new model for funding university research is found, little ammunition will be found challenging GMO crops. Unfortunately, even if we see a precipitous rise in GMO research coming out of Europe that uncovers dangers in GMO crops, the very fact that the research emanated from Europe is enough for dark corners of power in the U.S. to launch a smear campaign against the results (which is precisely what happened to some GMO researchers in France, whose findings were less than flattering for GMO crops). “If the research comes from Europe,” the meme goes, “it can’t be trusted.” Never mind that these smear campaigns have yet to answer the very simple question, “Why can’t continental research be trusted?” It is enough that findings representing a challenge to the market power of U.S. corporations be eradicated in the quickest manner possible.

As a former sustainable farmer and and present advocate, there are two issues surrounding industrial agriculture that can be challenged, because the support for these arguments are in plain sight: 1) the erosion of topsoil thanks to the industrial practice of no till and the massive expansion of cropland under management by a single farm and 2) the largely uncovered story of Private Equity and Hedge Fund investment in farmland around the globe.

The erosion story will wait for another day; you can read a quick summary of the problem in Urban Redevelopment in Agriculture under the section, “Two Ills, One Remedy,” pp. 19-21.

As for the corporate consumption of farmland that challenges global food security, I uncovered this trend in 2011 while working on a paper for Worldwatch, a sustainability organization based in Washington D.C. Savills PLC, of London, openly promotes its investment fund in farmland, specifically known as InvestAg Savills. This fund pursues farmland acquisitions globally. The fund is active in the States, but also in Africa, a continent that has struggled with food security ever since colonialization.

Now a story has emerged tracing the threat to U.S. food security from Private Equity as well. The trend is growing.

The thinking behind this seemingly sudden interest in farmland-as-investment is simple. Since the Global Financial Crisis of 2008, investors quickly discovered that if stocks, money markets, Collateralized Mortgage Obligations and other derivatives could not be trusted as investments, then find a bottleneck, the place where inelastic demand exists, namely, food and energy. Food and energy are inelastic in their demand because people need to eat and people need energy. There is no slack, there are no other options.

This is why Wall Street hedge funds have jumped into commodity speculation with both feet, driving up food and energy prices beyond levels demanded by substantive supply issues (Hint: there are very few real supply issues; most of the “shortages” reported in the press originate from “analysts” who operate as mouthpieces for Wall Street, and the dutiful dogs-turned-journalists report these analyses in the news without substantiating the claims).

Of course, farmland is directly tied into our food chain, so this becomes just another investment in industries with inelastic demand. It also holds the added benefit of large tax loopholes since investment in farmland turns speculators into “producers.” The goose laying the golden eggs is suffering from diarrhea, and the rest of us are left without real eggs.

More importantly, both farmland investment and topsoil erosion are real issues, and the arguments can be backed with real findings. This is why the sustainable agriculture community needs to concentrate on these real and immediate dangers, instead of chasing tenuous issues that are difficult to substantiate at the moment. Start with the substantive issues, gain some credibility, then go after demands for objective research into GMO crops.

Right now, the sustainable ag movement is running in circles, making deep ruts that lead nowhere. Meanwhile, industrial agriculture is heading in the wrong direction, unfolding in insidious ways, and very few are blowing the whistle of warning. As long as industrial agriculture keeps sustainable agriculture mesmerized by the GMO debate, it succeeds in castrating the movement.

Addendum: The sustainable agricultural movement needs to increase its awareness of the growth in shills from industrial ag populating its ranks. For instance, there is a large group on LinkedIn associating itself with organics that is loaded with industrial ag shills, and other actions by this group leaves a question as to where its loyalties can be found.

The entire organic-food industry has become suspect, as the certification process places a large financial burden on small producers while clearly favoring large producers – owned by even larger food giants – who not only find it much easier to pay the fees, but can achieve organic certification with lax standards. True sustainable agriculture is far more demanding in its practices but since there are no legal standards to define sustainable ag, nor any concerted effort to educate the public on sustainable ag since legal standards do not exist, it keeps real knowledge from making its way to the public forum.

Seven Years and Still No Basis for Regrowth

February 18, 2014

From a December 10, 2008 post on the original, independent The Small “r” blog:

During a mid-career pursuit of graduate school, I wrote a paper in 2004 investigating Japan’s seemingly endless and entrenched recession that started in 1991. This led me to research the economic health of middle-class American households which, in turn, brought me to the Federal Reserve data that I highlight in this paper (see page 4). At first glance, I had to double-check the calculations I ran on the Excel spreadsheets downloaded from the Federal Reserve. I couldn’t believe the increase in debt loads, nor how our economy was still functioning.

Having this knowledge swirling inside my head – it was akin to having a broken leg, wherein you can never completely ignore the pain until it heals – a short, almost insignificant news story caught my attention in March of 2007. The New York Times headline read:

Authorities Investigate Big Lender

The story reported accounting irregularities at the New Century Financial Corporation, a large mortgage company that specialized in subprime mortgages. “The troubles at New Century are the latest sign of the deterioration in subprime lending,” the story related, “until recently the fastest-growing segment of the mortgage business.”

Could this be the beginning of the unraveling? In light of what I knew about household debt loads, I was convinced of it. Online searches revealed that news stories as early as December 2006 started to report subprime mortgage holders were beginning to struggle due to rate adjustments. Two [now eight - ed.] years later, we still haven’t seen the end of the de-leveraging process.

Addendum

The Federal Reserve’s mammoth Quantitative Easing programs were installed out of fear, and one fear only: At all costs, prevent deflation, which is what a de-leveraging process of households will incur unless prices can be artificially propped up. Witness the fate of Japan. The real healing has yet to begin; we have simply seen a very large bandage applied on the U.S. economy over the past few years.

We have little meaningful household income growth save for at the the upper five percentile, the Federal Reserve’s Quantitative Easing helped increase food and energy prices at a time when most households experienced stagnant or declining incomes (thus pulling even more money out of circulation from the middle class), and what growth has been eked out can be traced to the continued rise in household debt, which is now being called “good news” by Bank of America CEO Brian Moynihan… as does, incredulously, Shaila Dewan at The New York Times.

Bottom line: Nothing will be done about the U.S. economy, which is why neither presidential candidate in the 2012 presidential campaign discussed economic rebuilding programs but managed to create many diversions. The end game is to drive down labor costs as much as possible, while continuing to drive up consumer indebtedness as much as possible. If this sounds like a recipe for disaster, well, it is, but remains of little concern for the powers-that-be. They no longer care, for at the point of collapse they will have extracted the maximum possible profits from the system, leaving no money on the table.

Obama Administration’s Economic Inertia – It Was Inevitable

February 13, 2014

An early post from The Small “r” blog, dated December 5, 2008. Troublesome indeed is the prospect the Democratic Party may rally around Hillary Clinton in 2016… more of the same:

With President-Elect Obama’s continuing Cabinet stocking of former Clintonites, it seems the only difference in scenarios we have between our present outcome and the one where Hillary Clinton would have won the primary and general elections is the occupant in the Oval Office. The former foxes that were supposed to guard the chicken coop, but instead opened the door to allow their fellow curs to feast, are dutifully returning for security duty. So the Bill Clinton brain trust – in concert with the George W. Bush brain trust – that placed us in many of our economic woes will continue in the fine Federal tradition of creating irrelevant answers.

Now we add the resume enhancer of “rubber stamper” to the desirable-features list on the Obama Administration’s vetting questionnaire:

Yesterday morning, Bloomberg News reported that Treasury Secretary-elect Geithner* may be trying to rid D.C. of Sheila Bair. I’m not in lock step with all of Chairman Bair’s plans, but she has been the lone voice (in the Bush administration) that consistently has been out in front of this economic debacle from the beginning. That’s not how she’s seen inside the beltway:

“Geithner, president of the Federal Reserve Bank of New York, has argued Bair isn’t a team player and is too focused on protecting her agency rather than the financial system as a whole, according to two congressional officials and a person familiar with his thinking. Bair has battled with Geithner and fellow regulators over aid to Citigroup Inc. and other emergency actions, making her enemies in the Bush administration.” (emphasis added)

Well, so much for President-Elect Obama’s team of rivals.

*It appears the Treasury Secretary-elect has a few questions to answer about his role in the government’s reaction to the credit crisis.

The Evil of Asymmetrical Information

December 3, 2013

I find it interesting that during the Global Financial Crisis, banks, the Federal Reserve, Congress and government-sponsored enterprises (GSEs) such as Fannie Mae and Freddie Mac implicitly blamed borrowers for the mortgage-default debacle by their actions, such as the Fed’s preference for helping lenders rather than homeowners, Freddie Mac betting against the homeowners and banks pressing the Fed to curb borrowers’ rights. Yet, when it came time to consider new regulatory action to prevent future mortgage debacles, the Fed wanted to strip homeowners of their right to fight foreclosures, and the only legislation with teeth came in the form of tougher scrutiny for borrowers, not banks.

What was, and continues to be, missing is a means to disseminate full disclosure of what, exactly, the home buyer is signing. That bright, shiny home is too much of a temptation, and all rational thinking goes out the door. Papers are pushed across the table, everyone is grinning, pens go to work signing, and keys are handed over. A new homeowner is born, and the poor son-of-a-bitch hasn’t a clue as to what he or she just signed.

I always tell family and friends the same thing, over and over, when buying a home: Hire an attorney and a home inspector. The home inspector retained by the bank is working for the bank, not the buyer, a detail over which most home buyers seem to remain completely clueless. It’s as if the bank has suddenly become a close friend, and is concerned the buyer may unwittingly buy a home with unknown defects. In fact, that home inspector has no other interest than in telling the bank that should the home go into foreclosure, the home’s condition is just good enough for the bank to expect its investment recoverable, ceteris paribus. If the buyer’s down payment and any subsequent investments in time and money are lost in the process, well, oh well.

And since when does someone sign a mountain of legal documents without retaining professional legal help in reviewing those documents? If a buyer cannot afford to retain an attorney, then he or she has no business buying a home.

Yet, few ever heed my advice, and I see homes being purchased without an attorney or inspector involved in the process.

It becomes difficult to muster any sympathy for such negligence but I will also side with the need for full disclosure to homeowners, including a strong suggestion from the seller of mortgages to retain an attorney and inspector. Short of that – and somehow we know home buyer behavior will not change despite what has just transpired in the home market in recent years – explicit explanations of just what, precisely, the buyer is signing onto should be mandated by law. Asymmetrical information – wherein the seller understands perfectly what is being sold but fails to provide full disclosure to the buyer – represents not only a potential economic collapse in the aggregate, but a moral failure in the particular. Properly functioning markets do not create morals, but certainly assume such morals are in place. This precipitous growth in the lack of trust in markets and market transactions goes to the very heart of why centralized capitalism is collapsing.

And yet, corporations continue to oppose symmetrical information: for example, the Grocery Manufacturers Association is fighting against full disclosure of food contents on labels. Without this information, consumers can hardly make informed choices that can have a direct impact on their health. In the aggregate, such decisions could help reduce the need to access the healthcare system in the future, and thus help contain healthcare costs.

From the corporate side, however, there’s little incentive anywhere. Hide the true and accurate content of food, and more buying decisions for a product will be made. If the contents of that food create illnesses, then more people will access the healthcare system and drive the demand for pharmaceuticals, hospital beds, physicians and medical devices. As healthcare costs rise, demand for health insurance rises in concert. It’s a win-win-win for the corporatists.

But for individual consumers? They are hung out to dry. In an era of decreasing incomes, yet with rising food and energy costs, consumers are becoming ever more stretched in being able to pay for health insurance. Some simply can’t afford it at all, and the Federal government’s answer is to place a gun at the head of those struggling to make ends meet and force the purchase of health insurance… just to make sure every last drop of blood has been squeezed out of the consumer. The corporatists certainly wouldn’t want to waste a good consumer.

At every turn the consumer is being stretched, and the increases in neuroses are rising as a result of having to live within this ugly reality. Simply track the precipitous rise in the sales of psychoactive prescription drugs… or even the illegal ones.

As long as the corporatists continue to block access to the critical information necessary for intelligent buying decisions, they will labor to bring about their own demise by ensuring the collapse of centralized capitalism. Trust in markets precedes functionality. Forget that, and you can expect a backlash against capitalism in the same manner we witnessed a backlash against communism in the late 20th century.

Only this time, there will be no backup economic system upon which we can rely.

A Very Long Summer, and the Silence Broken

October 17, 2013

My computer’s desktop is a mess. I haven’t run backups since late June. Stacks of paper pile high – or have already toppled – on my credenza. And a small spider saw fit to erect a web between the top of my desk and the stack of drives that sit on it, just to remind me of my slothfulness.

I use a laptop for my professional projects, but this desk for my personal projects. But time has not been kind to me of recent, hence the criminal neglect of my office environs. I usually have a number of professional and personal projects and travels to undertake in the summer, plus a deep desire to enjoy the warm days and kind weather while they last. So I tend to not inhabit the office as much in the summer. But this summer turned up the heat, when my 88-year-old father was diagnosed with a congested heart condition, placing him in a hospital for a month. This turn of events left precious little time for me to do anything else but the absolute essentials. But more on that at a later time.

For the present, I’m slowly digging my way out.

I kept an eye on the news over the summer but for some reason, I saw very little compelling substance that screamed at me to fire off a post. In fact, I find very little compelling news at all. The same old crap emanates out of D.C. from a very tired, dysfunctional government.The deficit hawks and the modern monetary theorists are, once again, at each others’ throats, trying to win an un-winnable argument when both sides are right and both sides are wrong.

Yet nothing has been done to address our economic woes, nor will it ever under the present power structure. For to address our economic woes we would have to address the unemployment situation, and the powers-that-be will never make a serious attempt to address unemployment. Such action would risk driving labor rates upwards.

God forbid.

What the power brokers are struggling with at the moment is how to keep wage rates sliding downwards while simultaneously stimulating the clueless masses to use their credit cards to buy stuff they don’t need, made overseas at labor rates even lower than ours, so that everyone can keep Jonesing their neighbors over a material race that is, at its essence, completely meaningless.

Oh yes, as we lie on our deathbeds we will recount, with warm memories, how many smartphones we owned over our lifetime and how many followers we gathered online, to the paltry number of family and friends surrounding us who still give two shits about our existence.

Very few seem to have sensed this future for themselves. I guess I should take this as a lesson for myself. If we bury ourselves in busy-ness over the trivial, we’ll successfully drown out the significant.

Ignorance, they say, is bliss but if this is true, then we should be the happiest damn country in the world.


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