Naked Capitalism has the post Is the Piketty Enthusiasm Bubble Subsiding? by Yves Smith. Yves has a lot of positive things to say about the book.  I think the following excerpt from her post is a good summary of what is troubling some critics of the Piketty book.

But as Taylor has pointed out in some technical detail, and others have alluded to, there are many reasons other than the invisible hand for r to remain high. Much of this can involve market failure, which Piketty explicitly rejects. See page 424 if you don’t believe me. R greater than g has nothing to do with market imperfections.

James Galbraith opened his review noting that capital meant power. If Piketty’s empirical analyses are right, and r has been persistently high, I’d suggest it reflects the power of the rich, not the natural forces of a free market economy. Higher taxes would help stymie the rich, but so would financial regulations, anti-trust campaigns, and public financing of politics that could minimize their power and privilege.

I’d like to read Piketty’s book with an open mind, but not an empty one.  That is why I wanted to make note of the criticisms.

The Real News Network has an 8 part series.  I have chosen the title of segment 3 that represents what this series is all about.

At the beginning of segment 1, Paul Jay gives an introduction that gives you the sense of what the series will be about.

Baltimore has many distinctions, one of which is not that well known, certainly not outside Baltimore. But Baltimore is the home of the subprime mortgage. It was in the 1990s that the African-American population of Baltimore, and to some extent New York and Chicago, but primarily Baltimore, were targeted to have loans at under-market rate that would later balloon and force people out of their houses.
.
.
.
Tens of thousands of people were thrown out of their houses and millions of dollars lost by homeowners. Of course, when people lose their houses, it’s not just the people in those houses that suffer. For those of you who have seen the show The Wire, one of the reasons you see all of these boarded-up houses in Baltimore is not just because people have been thrown out but because neighborhoods start to deteriorate. As houses are foreclosed on, other houses start not to be able to get loans from banks to get fixed up, and places that were vibrant and real communities wind up half-vacant and you–what begins a process of, more or less, ethnic cleansing.

That’s just one small example how finance exploits all of us. And that’s the subtitle of a new book. And its author is now with me in the studio.

Thanks for joining us.

COSTAS LAPAVITSAS, PROF. ECONOMICS, UNIV. OF LONDON: Pleasure to be here.

JAY: So Costas Lapavitsas is a professor of economics at the School of Oriental and African Studies, University of London. He’s a member of Research on Money and Finance (RMF) and the lead author of RMF’s book Crisis in the Eurozone. His previous publications include Social Foundations of Markets, Money and Credit and Political Economy of Money and Finance. His most recent book is Profiting without Producing: How Finance Exploits Us All.

The first segment is titled Growing Up in the Greek Police State – Costas Lapavitsas on Reality Asserts Itself (1/8). You may be surprised at the aspects of history that you can learn from the segment. At this point, you can a different picture of the recent history of Greece and how it might connect to the main subject of the series.

The second segment is titled After the Fall of the Dictatorship, I Knew Political Economy was the Key – Lapavitsas on Reality Asserts Itself (2/8).

With the some history of the world and the background of the interviewee out of the way (all very interesting to see and hear about), we get to segment 3 titled The Rise of the Big Banks – Costas Lapavitsas on Reality Asserts Itself (3/8).

Mr. Lapavitsas says that large scale industrialization created the need for massive amounts of capital and big banks, a process that developed an aggressive global capitalism

This is the part where you begin to see how finance and capitalism were qualitatively transformed from its early beginnings to where we are now.

As of the writing of this blog entry on May 23, 2014, only these three segments of the series have been published. I have high hopes for the value of the remaining 5 segments. You can go to the web site for The Real News Network yourself to get the remaining segments as they are published. Although, I wouldn’t be surprised if I blog about those other segments as they come out.

The fourth part of this series is covered in my subsequent post The Financialization of Big Business – Costas Lapavitsas on Reality Asserts Itself (4/8).

New Economic Perspectives has the article Sutherland Explained in 1939 Why GM Killing Customers Isn’t Treated as “Real Crime” by William K. Black.

Edwin Sutherland was right about elite white-collar crime; and he’s still right

This year is the 75^th anniversary of Edwin Sutherland’s 1939 Presidential address to the annual meeting of sociologists in which he announced the concept of white-collar crime.
.
.
.
Economists and most criminologists don’t understand financial crimes

“This paper is concerned with crime in relation to business. The economists are well acquainted with business methods but not accustomed to consider them from the point of view of crime; many sociologists are well acquainted with crime but not accustomed to consider it as expressed in business. This paper is an attempt to integrate these two bodies of knowledge. More accurately stated, it is a comparison of crime in the upper or white-collar class, composed of respectable or at least respected business and professional men, and crime in the lower class, composed of persons of low socioeconomic status.”

Sutherland’s doctorate combined the study of the economy and sociology. Note that Sutherland emphasized from the beginning the importance of elite white-collar crime by businessmen and professionals and what I refer to as “seemingly legitimate” entities – Sutherland archly calls them “respected” though they are not “respectable.”

This treatment of white-collar crime is not universal. The news has had stories of how white-collar Criminals in China have been executed for their crimes. For example, see the article 22 Chinese People Who Were Handed The Death Sentence For White Collar Crime.

Not that I am a proponent of capital punishment, but imagine if that kind of punishment were possible in the USA for white-collar crime.

This is the 4 part of a 5 part series from The Real News Network – Class Struggle in Palestine – Ali Abunimah on Reality Asserts Itself (4/5).

And, again, this was all marketed as building the state, building the economy, creating jobs. But what they’re actually doing is creating these extraterritorial zones where Israeli and international companies can come in, get cheap workers. There’s no protections for workers’ rights. There’s no environmental protection. Israel is already using the West Bank as basically a toxic dump site and moving its dirty industries there. This is only going to get worse if the World Bank and IMF-type schemes continue. And these industrial zones, they hand them over to private companies, who then have the right to set up private armies, and nobody can come in without their permission, no Palestinian officials can come in. So in essence you’re going to have private corporations on Palestinian land who have more sovereignty than the Palestinian Authority. And they don’t have to pay taxes. They get, you know, export/tariff-free access to world markets. And this totally undercuts and destroys indigenous Palestinian businesses. This is what’s happening now.

This is an aspect of the Palestinian situation that I have not heard about before. As in this country, a rising average wealth is touted as a sign of universal progress, when the average is skewed by all the gains going to a few people at the top.

Many times the rich have a better understanding of the rich in other cultures than the poor do in understanding the poor in other cultures. Of course the rich have a vested interest in maintaining this disparity, so it should come as no surprise.

The first three segments in this series were covered in my previous post Awakened by the Palestinian Intifada – Ali Abunimah on Reality Asserts Itself (1/5).

The Real News Network has a 5 part series of which 3 parts are available in this post.  The introduction to the series is excerpted below.

On Reality Asserts Itself, Ali Abunimah, founder of Electronic Intifada, says that Palestinians need to know that even in a country with formal legal equality, the reality can mean mass incarceration, economic inequality and racism

There are three sections to this blog post of mine.

Awakened by the Palestinian Intifada – Ali Abunimah on Reality Asserts Itself (1/5)

My father is from a village called Battir, which is in the West Bank. And, interestingly, both villages have been in the news recently, Lifta because it’s one of the very few villages that was depopulated in 1948 that remains largely intact, and there are people from Lifta who are fighting to preserve the village, and ultimately to return to it. And Lifta is now the target of an Israeli plan to build luxury housing, presumably for the Jewish population. And so, recently there was a court order that stayed this, although for how long we don’t know.

And Battir has been in the news because it has been recognized by UNESCO as a site of particular importance in terms of its ecosystem and the terraced irrigation that dates back to Roman times. And it actually won an award from UNESCO a couple of years ago. And so even the Israeli organization to protect nature has petitioned the high court against a plan to build the apartheid wall through Battir. So it lies right on the so-called Green Line between the West Bank and the part of Palestine that became Israel in 1948.

If you have been raised to believe that the land now occupied by Israel was a desert before the Jews came to Israel and “made the desert bloom”, how do tou reconcile this with the description of Battir. Even Lifta didn’t seem to be a desert then needed to be made to bloom before Israel depopulated it.

Palestinians Can Learn from the African-American Struggle – Ali Abunimah on Reality Asserts Itself (2/5)

… at every occasion, President Obama and all his predecessors will tell us that, oh, the United States and Israel have shared values. And so what are these shared values? And I argue that it includes things like a really racialized view of the world, where Palestinians, in the case of Israel, and African Americans, Latinos, and other people of color in the United States are viewed as some kind of demographic threat that needs to be policed and controlled and surveilled.

And these shared values take a very real form when you see–and I write about this–that the top police brass from almost every major U.S. city and many smaller cities have been taken on junkets to Israel by groups including the American Jewish Committee, the Anti-Defamation League, groups sponsored by AIPAC, the Israel lobby group, and they take them to places like Megiddo Prison, where Palestinians are routinely tortured, including children, held in solitary confinement. And then they come out and they say, oh, the Israelis are so good at, you know, security and in living in a tough neighborhood. And even that language of the tough neighborhood, it comes out of a racialized American discourse. And they say–you know, you see all these quotes from American police chiefs saying, oh, the Israelis are such experts, we’re going to take what we learned back to Chicago, back to L.A., back to Baltimore.

And, in fact, Israel is–its niche now is the so-called homeland security industry, where they’re exporting billions of dollars of, you know, goods, weapons, and services to federal, state, and local police and judicial authorities. So there’s a real kind of convergence of ideology and business interest, where, in a sense, you know, if you’re fighting mass incarceration in the United States or if you’re fighting what Israel is doing to Palestinians, you really need to be part of the same fight, because it’s the same corporations profiting from them and it’s the same politicians who are talking about Israel as a paragon of, you know, human rights and a model for the United States while backing the hypermilitarization of policing, the rail to jail for schoolchildren in the cities, particularly African-American schoolchildren, where we see public education being gutted and privatized and at the same time we see prisons flourishing.

This examination of shared values is the very thing that troubles me so much about the current state of the State of Israel. I just cannot say that I share the values of the government and perhaps a majority of the citizens of Israel. Ethically, what is being done to the Palestinians is just not something I can condone. (Certainly this does not imply that I condone everything that the Palestinians and other Arab/Muslim states do. I do not condone everything that the USA does.)

Does Israel Have a Right to Exist as a Jewish State? – Ali Abunimah on Reality Asserts Itself (3/5)

I had already thought about the example of South Africa and it’s sudden turn-around in giving up the idea that apartheid was absolutely necessary. Seeing this interview is not what put this idea into my head.

It took a Civil War to get the people of the American Confederacy to give up their idea of this, too.

The idea that “Just because you have treated people so badly that you fear they will kill you if they ever get power” cannot be allowed to be used as an excuse to continue that treatment. If your fear is that strong, then you ought to get out and leave the people alone that you have been mistreating. Well, of course, that presupposes that some other country will have you after what you have done.

The Daily Kos is providing you with a web page to Urge President Obama: Honor your pledge to preserve an open internet.  Below is the content of the message I sent.  The first two paragraphs are boilerplate suggested by The Daily Kos.  The rest the message are my own thoughts.

It was a grassroots, people-powered campaign that first elected you President—thanks in large part to online organizing. This happened because of the incredible equality of the Internet, where no website gets favored with a “fast lane” based on ability to pay.

But your F.C.C.—with its Chairman, Tom Wheeler—threatens to undermine all of that, and we are pleading you to take decisive action. Please demand real net neutrality standards.

Don’t let the FCC try to hide behind tricky definition of words.  Analyze the consequences of their actions on constraining the voices of ordinary citizens by giving wealthy corporations and citizens greater access to the internet than everyone else.

There is no practical difference between paying for higher speed access and having your access slowed down unless you pay more money.

Once you establish that no one should be able to get access to the the latest internet technology only by paying a higher rate for that access, then you can test whether any FCC action passes this test regardless of the words used to mask its effect.

You know you already pay extra for higher speed uploading to and downloading from the internet.  The FCC is also considering having you pay more for higher speed travel once you get your content onto the internet.  Enough is enough already.

I wonder if the President is paying more attention to campaigning for a position with some Wall Street outfit like Goldman Sachs than he is to running the government for the benefit of all of us.  You can’t always tell what motivates a person, but you can judge the impact of his actions.

New Economic Perspectives has the article Randy Wray: What are Taxes For? The MMT Approach.

But in the case of a government that issues its own sovereign currency without a promise to convert at a fixed value to gold or foreign currency (that is, the government “floats” its currency), we need to think about the role of taxes in an entirely different way. Taxes are not needed to “pay for” government spending. Further, the logic is reversed: government must spend (or lend) the currency into the economy before taxpayers can pay taxes in the form of the currency. Spend first, tax later is the logical sequence.

Some who hear this for the first time jump to the question: “Well, why not just eliminate taxes altogether?” There are several reasons. First—as we said last time–it is the tax that “drives” the currency. If we eliminated the tax, people probably would not immediately abandon use of the currency, but the main driver for its use would be gone.

Further, the second reason to have taxes is to reduce aggregate demand.

I have read about this aspect of MMT before, but this is the first time I have read these details and this emphasis.  It helps to hear it explained this way.  It also helps to put up front what are not the implications of MMT that one might  assume having heard only the first part.

The part of needing to have taxes to reduce aggregate demand implies that MMT proponents do believe in keeping inflation under control by having enough taxes to reduce aggregate demand if that demand would become inflationary.  So it is unfair to claim that MMT proposes to print all the money you want so much so that it would cause inflation.  MMT wants you to have the correct understanding of the role of currency for a government that issues its own sovereign currency.  It wants to free you of the idea that taxes need to be levied in order to fund federal government expenditures.

PC World has the article which is actually titled FCC moves forward on net neutrality plan: What now?. I would hardly call their plan neutral, so I used a more appropriate word for the side that the FCC has come down on.

One of the services of the PC World article is in the following excerpt:

Where can I comment?

An easy way to comment is to go to the FCC’s comment page, which(sic) a link to the proposal officially titled, “protecting and promoting the open Internet.” Clicking on the proceeding number, 14-28, takes you to a Web form where you can leave a comment.

The FCC’s email box for the proceeding is also still working. It’s at openinternet@fcc.gov. The FCC’s phone number is 1-888-225-5322, although the agency in recent days has encouraged people to send comments electronically instead of calling.

While anonymous comments are allowed on the FCC website, comments may be taken more seriously if you leave your name.

When it becomes available to can see my comment that I made to the FCC at http://apps.fcc.gov/ecfs/comment/confirm?confirmation=2014516324964

If you are satisfied to see the unofficial version, this is what I said.

Clearly, the internet is a means of communication that rivals the telephone in its importance to our society and democracy. Thus, it would make sense to rule that ISPs are utilities. Why not officially categorize them as such and regulate them as such?

Once a user has placed something on the internet through an ISP, then that item needs to be routed in the same manner as any other item on the internet. If you allow the the ISP to charge a fee for special handling, then you encourage that ISP to invest in the performance of this special handling route rather than investing in technology that helps all customers equally. This vital US infrastructure cannot be allowed to fall further behind the rest of the world.

Perhaps even worse, the ISP can just prioritize the packets of the higher paying customers rather than treating every packet on a first come first serve basis.

Market forces of competition might normally keep ISPs in check to prevent them from abusing their customers. However, the trend that the government anti-monopoly regulators seem to be allowing is more unreasonable corporate concentration. You need to take this reality of the political environment into consideration when you consider how your ruling may interact with existing conditions.

You cannot use the deregulation of the telecommunications industry as a guideline without also taking into account the monopolistic breakup of A T & T that occurred at the same time.

So don’t just sit there and complain to those within earshot or internet shot, send your comment to the FCC where it might do some good.

The Daily Kos has the article Stephen Colbert looks at Rove’s smear against Hillary.

Thanks for The Daily Kos clearing up what Colbert said about copro-encephalopathy. I thought Colbert just said that Rove had it in his brains.

It’s called copro-encephalopathy, or in layman’s terms, shit for brains.

How would we ever know what Comedy Central bleeped out if we didn’t have The Daily Kos to straighten things out?

Salon has the article They’re lying about Ukraine, again: Primitive prejudice, stupidity and the reflexive compliance of the New York Times by Patrick L. Smith.

My concern is with what the Ukraine crisis has unexpectedly exposed: the bankruptcy of the story, the hollowness of the pose. To be revealed is the great collection of presuppositions, prejudices, presumptions, myths, representations and ideological beliefs that were the ink with which the American century narrative was written.

Good for Ukrainians, all of them in the end, that Washington’s effort to install a crew of neoliberal puppets in Kiev has been disrupted. Good for everyone, including Americans, that the Ukraine crisis exposes so many of the defects in the prevalent American worldview. I may judge the moment too optimistically, but there seems no going back from this.

This seems to be an explanation of why the propaganda is so deeply embedded in the reporting from prominent newspapers such as The New York Times.

To be charitable to the reporter that Leonid Goldgeisser mentioned in my previous post NPR Mistranslates Interviews With Russian Speaking Ukrainians, the reporter just could not believe what the interviewee was saying on the surface.  Perhaps the reporter was trying to read what the interviewee was saying between the lines, and that is how she came up with the complete reversal of what was actually said.  It would be interesting to know the chain of events that led from the interviewee’s Russian speech to the reporter’s English translation.  Was their an intermediate translator, or was the reporter fluent enough in Russian to attempt her own translation.  Was she thinking, “I hear the words, but I am going to do my listeners a favor by explaining what the interviewee is really saying.  After all, no westerner could understand how convoluted a former Soviet Union citizen has to speak to sneak their actual message past the censors.”