Bernie Sanders contingent in the Marlboro Labor Day Parade

Sharon and I are in the front row, left of center in the photograph. We are holding signs that I made as is the person to the left of me in the photo.

Aimée J. Dupont posted this on her Facebook site.

October 11, 2015

I had occasion to take post some other pictures that were give to me of the Labor Day parade. I posted them on the Worcester Wants Bernie team messaging center, do I might as well post them here, too.

Here is one of Sharon and I actually marching in the parade. There is a placard that I am carrying just below the sign I we had made for the parade.

Here is another picture as we started out on the parade. You can get a little better hint at the black placard that I carried along with my sign.

YouTube has the video Cornel West and Richard Wolff talk about Capitalism and White Supremacy.

A conversation about capitalism with two brilliant minds, Cornel West and Richard D. Wolff, together in a rare joint appearance. Richard D. Wolff is Professor of Economics Emeritus, University of Massachusetts, and author most recently of Capitalism’s Crisis Deepens: Essays on the Global Economic Meltdown 2010- 2014/ Dr. Cornel West has written or edited dozens of books, including classics like Race Matters, and Democracy Matters. His most recent is Black Prophetic Fire, written in conversation with Christa Buschendorf. Also in the show, activist Manju Rajendran tells us about a small business that is successfully operating under an anti-capitalist economic paradigm. And Laura raises questions about the record-setting settlement with BP over drilling disaster in the Gulf Coast.

Having only worked in capitalist workplaces all my life, I still have trouble understanding how the ideals of Marx would really work in practice, Government capitalism as practiced in the Soviet Union, did not work out, but I get that this is not an example of what Marx had in mind.

As Cornell West indicates, he thinks Marxian analysis is brilliant, but that is not the same as thinking that the Marxian prescription is just as brilliant.

The New York Times has the article Justice Department Sets Sights on Wall Street Executives.

Stung by years of criticism that it has coddled Wall Street criminals, the Justice Department issued new policies on Wednesday that prioritize the prosecution of individual employees — not just their companies — and put pressure on corporations to turn over evidence against their executives.

Perhaps Attorney General Loretta Lynch will turn out to be a much better Attorney general than I thought. Perhaps those years of criticism published (or noted) on blogs like this one, and the many more famous ones have had an impact.

Whatever its practical implications, the memo is likely to resonate on the presidential campaign trail. In a speech this summer, Hillary Rodham Clinton seized on the sentiment that too many executives were escaping accountability, declaring that, if she were elected, her administration would “prosecute individuals as well as firms when they commit fraud.”

Is The New York Times still playing the Where’s Bernie game? Bernie Sanders position on this is a lot stronger than Hillary Clinton’s and he has espoused it for a lot longer. The New York Times admits its site is searched more times for Bernie Sanders than for Hillary Clinton. If this newspaper refuses to inform its readers about the subject matters that they want to know about, they are going to be losing even more customers than they have already lost.

There is a great explanation in a comment on Michael Pettis’s Blog, about some Self-Reinforcing Relationships between Debts and Slowing Economies.

The start of the explanation got me interested.

The self-reinforcing relationship between rising debt loads, slowing economic growth and heightened financial volatility is visible in many different countries. Each political system is of course pressed to provide a response. This vicious circle is in itself very hard to break out of, and your analysis of the pro-cyclical effects of credit leading to fast profit growth on the way up and to financial distress on the way down is implacable. Yes, perhaps policymakers underestimate these effects. But it is also true, I believe, that the policy response is not so much dictated by the nature of the problem at hand. The way in which the political system is organized dictates to a large extent the formulation of the policy response, typically along the path of least resistance from the point of view of the vested interests.

The heart of what the comment’s author is explaining is in his statement

A few lucid minds observed in 2008-2009 that, to reduce global balances feeding the global debt snowball, a joint movement was necessary, involving the countries with excess domestic supply over domestic demand (China) increasing domestic consumption and the countries with excess domestic demand over domestic supply (the US) increasing domestic supply.

This is the rebalancing that has to happen.

My response to that comment was:

Now this is an explanation I can follow and believe. One big factor you left out, and only brushed by in the end was:

“Or, in other words, could it be the case that the interests of the political elite have diverged from the interests of their population in so many places?”

You didn’t say it, but in my view the rise of billionaires in almost all countries is the problem. If these billionaires didn’t get all the benefits of rising productivity, freer trade, etc., but left some of the money for other people in society to earn, then those other people wouldn’t be forced to go into debt. It is the Wall Street types who have been pushing on the debt bubble, repackaging, and selling debt, and reaping huge profits for putting people into debt.

You didn’t mention in your list of possible things to do to get out of the debt crisis is forcing a more even distribution of wealth. You may have been thinking of this outcome in your last sentence when you said “Things might happen.”

I’d like to see an orderly and controlled things happening, than to see it end in violence. However, one way or another, this imbalance will be rectified.

There was a massive amount of comments on the original article with which I struggled as explained in my previous post Michael Pettis: If We Don’t Understand Both Sides of China’s Balance Sheet, We Understand Neither. I am glad I kept reading, because the comment I focus on here was worth all the effort.

There was another great exchange in the comments on the original article. Here is part of a comment by Vinezi Karim about inadequate aggregate demand.

However, is there inadequate aggregate demand in the US? I don’t think so. I would argue that the US has *EXCESS* aggregate demand. This point was discussed in some detail in the comments section of one of Michael’s previous articles. Here is that comment:
http://goo.gl/LckF4X

Therefore, UNTIL the US closes its current account deficit (i.e. either balances the current account or runs a current account surplus), any Keynesian solution would be either ineffective or inefficient. In light of this, if underemployment continues to be a problem in the US, then the first order of business must be to wipe out that trade deficit BEFORE we go about playing Robin Hood.

I found this to be an enlightening explanation, that we may have sufficient demand, but it is getting fulfilled by making jobs in China, not in the USA. This is what Bernie Sanders has said many times about the job creation from our demand. I responded to this comment on the web site, but I am changing my mind as to how to respond.

Yes, we need to fix our trade deficit problem, and one way that I posited to fix that was to let the dollar depreciate relative to foreign currencies so that American workers could fulfill the domestic demand with goods produced in America. One trouble with this is that other countries will try to race us to the bottom of currency value in order to protect their domestic employment. Nobody is the ultimate winner in a race like this.

All the countries in the world can’t be net exporters to solve their domestic employment needs. If there are net exporters, then by simple arithmetic there have to be net importers.

The best solution is to have all countries have a balanced mix of exports, imports, and domestic production to satisfy there own needs, and keep the whole world in balance.

When the whole world is racing to be a net exporter, then there is an excess of supply over demand in the world. Perhaps we need some world wide cooperation to go along with some world-wide competition.

The Free Thought Project has the article Hawaii Sees 10 Fold Increase in Birth Defects After Becoming GM Corn Testing Grounds.

Waimea, HI – Doctors are sounding the alarm after noticing a disturbing trend happening in Waimea, on the island of Kauai, Hawaii. Over the past five years, the number of severe heart malformations has risen to more than ten times the national rate, according to an analysis by local physicians.

Note that the article is not blaming the GMO in the GMO crops. The blame is on the use of pesticides to see how pesticide resistant the GMO crops are. I don’t know how reliable the sources for this story are, but I think it is something that we need to watch to see how it plays out.

I wouldn’t consider the PBS News Hour to be a reliable source, but they have the story GMO seeds grow into big fight on Kauai. Remember that PBS receives less government funding than it used to, and receives much more of its funding from the oligarchs that run these big companies.

Some people see some similarities between Bernie Sanders and Donald Trump. I think there is one obvious question you need to ask yourself to see the key difference.

Do you want Bernie Sanders or Donald Trump to lead you into battle against your adversaries?

The one thing I would think you would want in a leader is someone who knows who the adversaries are. Bernie Sanders tells you the ones who rig the system against you and are getting all the income and wealth to your detriment are your adversaries. Donald Trump says your adversaries are the ones who have no control over the system, who have less than you do, and only own a tiny fraction of the nation’s wealth.

If Donald Trump were to enlist you into a war against the people who have nothing, what would you have after you won? Trump and his fellow oligarchs would still be rigging the system, will still be holding almost everything, and you’d just have a bigger share of nothing. With a Trump win, the country would be rid of the people at the bottom of the ladder, which would put you at the bottom of the ladder, and next in line to be got rid of.

I don’t think there is any other consideration that would outweigh the answer to this question.

Naked Capitalism has the article Congressional Black Caucus Still Trying to Hurt Their Constituents By Killing the Labor Department Fiduciary Rule.

This is an insane argument. In essence, asset managers are saying that they only way they can afford to offer financial advice to low and middle-income earners is if they screw them. If you force them to act in their clients’ interest, it won’t become cost-effective. So CBC members want to protect their constituents’ ability to get sham advice contrary to their interest? There is no question that these constituents would be better off with no advice at all.

I remember back to the days when I was writing and supporting simulation programs for the semi-conductor industry. Richard Newton, a professor at the University of California at Berkley, was a leading light in the academic world in this field. In discussing questions of accuracy when solving difficult equations in a simulator he often remarked that it was better to get no answer than the wrong answer. In other words, you could employ all sorts of techniques to get the simulator to find the answer in difficult situations, but you must guard against any technique that could come to the wrong answer and present it to the user as a solution to the equations. Better to just tell the user that the simulator was unable to solve the equations.

YouTube has the video Socialism For Dummies.

Professor Richard D. Wolff explains in 50 minutes what socialism is NOT.
Where does the American fear of Socialism, Communism and Marxism come from?

As a firm backer of Bernie Sanders, even I got quite an education from watching this video. It gave me a much more nuanced view of Socialism. I had not recognized, in quite the detail presented here, the difference between state run capitalism and true socialism. That doesn’t mean that I believe “true” socialism will work as imagined, whatever that may be. Organizing human society is a work in progress. Even thinking about how to organize is a work in progress. What this video did is to give me more ideas to think about.

September, 5, 2015

Here is part 2

If you don’t have the time to view this whole lecture, there is a very powerful part in the last 5 or so minutes during the Q & A. You can skip ahead to it. It’s at 1:06 into the video. I won’t give away the power of the surprise by saying anymore.

Naked Capitalism has the post Kaliningrad, Russia – The Dagger Points East and West. The article is full of charts, and maps, and words. It sort of takes it into the TL;DR (too long; didn’t read category), but I did skim most of the rest of it after I realized it was TL;DR.

Cutting to the chase, I came across this excerpt toward the end.

That leaves the US and NATO to promote subversion inside Kaliningrad. The first deployments are of the green men and volunteers known by their western cover as investigative journalists.

I don’t know if there are any good guys in this game that is being played behind our backs. What little we know of the game is being leaked to us by people whose motive’s we don’t know. Perhaps both sides are just acting like scared little children who don’t know how to get themselves out of the mess they are in.

It seems to me, that at the very least each side is responding to escalating provocations from the other side. Each is hoping that its own most recent provocation will finally make the other side give in. We have seen this scenario played out in the lead up to probably most of the wars we have gotten into.

Isn’t there any way to stop the escalation? Can the two sides get together, and agree that this is all getting out of hand? Can they agree that they need to find some way to stop the escalation?

The only people who seem to have a stake in the future are the people with children and grandchildren who are not believers in an after life. People without children may make it out of this world before it all blows up. People who believe in the afterlife, depending on their particular beliefs, may think that the sooner Armageddon arrives, the better. That’s when we will all be resurrected to live in a Paradise. Is it going to be left to the rest of us to find a way to prevent WW III?

Naked Capitalism has the potentially important article Michael Pettis: If We Don’t Understand Both Sides of China’s Balance Sheet, We Understand Neither.

China is a dynamic and unbalanced economic system entering into something that we might grandly call a “phase shift”, or less grandly the rebalancing process, and that it is doing so with a great deal of debt structured in a highly inverted way. Anyone who sees China this way would have been able to predict not so much the specific shocks, panics, and credit crunches that we have experienced, but rather that we would of necessity experience a series of very similar shocks.

As I read this the author seemed to be displaying an annoying propensity to dance around the issue without making it clear to me what he meant. Perhaps that is only because I didn’t understand his terminology rather than the fact that he refused to give me the specifics that would have made it clear to me.

I found one tantalizing sentence that hinted to me what this article was about.

I believe, however, that without a massive and fairly unlikely transfer of wealth from the state sector to the household sector, the average Chinese GDP growth rate under Xi Jinping cannot exceed 3-4%.

Nowhere else did he explain which balance sheets were out of whack, inverted, nor did he ever mention again the sector issues, let alone the specific state and household sectors. Over and over he talked about too much debt, but never said which sector was too much in debt.

Maybe a finance expert can read this, and explain to me the golden nugget of what this article is trying to tell me. I have a strong feeling that there is a golden nugget to be found.

I think there may be a relation between this article and a conundrum for the Chinese economy that I always wondered about. If the Chinese economy depends on massive exports, how is this going to succeed when all the buyers of Chinese products run out of the money to buy these products? The answer seemed to me to be having domestic demand in China sop up the products for which China could no longer find foreign buyers. Is this article saying that the state is keeping too much of the wealth, and not transferring enough of it to the private sector to spur private domestic demand? If the author would only say this, and talk about specifics on solving this problem, perhaps his disagreements with other experts could be resolved. I have a feeling that his disagreements arise because the other experts can’t figure out what he is getting at either.

I have posted that last paragraph as a comment on the article on Michael Pettis’ blog.