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Archive for July, 2008

>Traded Away

>A cunning new loophole has wrecked the government’s Climate Change Bill.

by George Monbiot

Published in the Guardian (July 24 2008)

For the past two years I have been fretting over a mystery. Though Labour seems to have done everything possible to ensure that it stays out of office, there remains a possibility that it might form another government at some point between now and 2050. This means that its climate change bill, which will become law in the autumn, could come back to haunt it. Despite its evident flaws, this is radical and unprecedented legislation. It imposes a legal obligation on future governments to cut carbon dioxide pollution by sixty per cent or more by 2050, with binding interim targets every five years.

The government has some good climate policies. It also has some bleeding disastrous ones, which appear to commit the United Kingdom to high carbon pollution for the entire period covered by the bill. A future Labour government would find itself snared by its own current policies. Surely it wouldn’t be foolish enough to set such a trap for itself?

One policy alone seems to doom future governments to prosecution: the planned doubling of the capacity of the UK’s airports by 2030. Using the Department for Transport’s projections, I estimate that by 2050 aeroplanes will account for 91% of all the greenhouse gases the country should be producing. Under the less optimistic figures published by Defra, the environment department, the proportion rises to 258% {1}.

Until now this hasn’t been a problem: the government has refused to include aircraft pollution in the 2050 target. But following an amendment in the Lords, the draft bill imposes a duty on the government either to include it or to explain to parliament why it hasn’t done so, within five year {2}. The government claims that it might not be possible to add these gases to the UK’s carbon budget because, “in the absence of an internationally agreed methodology”, no one knows how to calculate what proportion of this pollution belongs to us {3}.

It’s a knotty problem, isn’t it? If you were the government and you knew that 67% of the passengers using UK airports were residents of this country {4}, could you work out what proportion of aircraft emissions should be counted in the UK’s carbon budget? No? Me neither. Wouldn’t know where to begin.

This ridiculous excuse can’t be sustained for much longer. At some point aircraft gases will have to be included in the carbon target. Throw in the government’s road-building programme and its intention to approve new coal-burning power plants and you can see that it has a problem.

The only factor now holding down carbon emissions is the price of energy. They fell by two per cent last year, and the government admits that this “was largely explicable in terms of price relativities” {5}. In other words, it has again become cheaper to burn natural gas in power stations than to burn coal, while the cost of oil has encouraged people to drive less. The two per cent reduction means that the UK’s carbon budget is now a grand total of 0.8% smaller than it was in 1997 {6}. The government can post a sixteen per cent cut in greenhouse gases since 1990 only because of the accidental reductions made during the dash for gas under the Tories and the sharp reduction in methane and nitrous oxide from rubbish dumps and industry. Neither of these cuts can be repeated.

But this doesn’t even begin to describe the government’s problem. Its new climate change report contains a tantalising figure. It is expressed in such a back-handed way that you have to perform half a dozen small calculations to discover what it means. The report boasts that even when emissions in countries exporting goods to the UK are taken into account, “the total annual reduction of UK greenhouse gas emissions since 1990 was around 240 million tonnes of carbon dioxide equivalent [MtCO2eq] below business as usual” {7}. The government says that “business as usual” would have led to an increase of forty per cent in emissions since 1990. This gives us a figure of 1079 MtCO2eq {8}. Subtract 240 from 1079 and you get 839, or 187 MtCO2eq above current emissions {9}. This means that instead of declining by sixteen per cent since 1990, as the government insists, the greenhouse gases for which the UK is responsible have risen by nine per cent.

When I finished this sum I sat still for quite a long time. The UK’s entire climate change programme is based on a statistical artefact. The only reason our pollution appears to have declined is that we have outsourced our emissions. A fair account of our carbon emissions would include those we import minus those we export: a balance that can only worsen in a post-industrial economy.

So how can the government reconcile its energy policies with future political hazard? Well the mystery has at last been solved. The key to the puzzle is found in a minor briefing note just published by Defra. It explains that, during the latest stage of the bill, the government “remov[ed] the quantified limit on the use of internationally traded credits in meeting the UK’s targets” {10}. In other words we could buy the entire cut from other countries.

Given that we are outsourcing some of our greenhouse gases, you might think it makes sense to outsource our carbon cuts as well. But there are three problems. The first is that we are exporting emissions that are difficult to address and importing, through carbon trading, the easiest and cheapest cuts.

The second is that while the emissions we export are certain and verifiable, the cuts we buy through carbon credits are often fraudulent. For example, as the writer Oliver Tickell documents, 96% of the carbon credits from hydroelectric dam construction were issued after construction had begun: the dams would have been built without the carbon market, so no additional cuts have been achieved {11}. Around thirty per cent of all carbon credits comes from the sale of trifluoromethane cuts by Chinese and Indian companies making refrigeration gases. Many of them are still producing this pollutant only because they make so much money from cleaning it up: the carbon market pays them 47 times more for these cuts than the gas costs to remove {12}.

Behind these problems lurks a much greater one, which is mathematically impossible to resolve. You can trade your way out of trouble when the cut you are trying to achieve is a small one. But when the global cut required to prevent two degrees of warming is sixty or eighty or ninety per cent, then every rich nation must reduce its emissions by roughly the same amount. Otherwise half the world would have to buy credits equivalent to 180% of the emissions produced by the other half.

The government will have to impose some kind of cap on carbon trading. But I bet it will be set high enough to cover any failures in domestic policy, as measured by the rigged accounting methods civil servants use. This means that successive governments will have no legal incentive to change their energy policies. The carbon trading provision torpedoes the useful content of the entire bill.

But at least the mystery has been solved, and it will no longer keep me awake at night. Now I can focus on the real nightmares.

http://www.monbiot.com

References:

1. The calculations are explained here:
http://www.monbiot.com/archives/2006/12/19/preparing-for-take-off/

2. Draft Climate Change Bill, as amended in public bill committee, part 29. http://www.publications.parliament.uk/pa/cm200708/cmbills/129/08129.11-17.html#D002b

3. Defra, 15th July 2008. Climate Change Bill: Update following House of Commons Committee Stage. http://www.defra.gov.uk/environment/climatechange/uk/legislation/pdf/080715-CC-Billupdate.pdf

4. Sally Cairns and Carey Newson, September 2006. Predict and Decide: aviation, climate change and UK policy. Environmental Change Institute, University of Oxford, page 8.
http://www.eci.ox.ac.uk/research/energy/downloads/predictanddecide.pdf

5. Defra, July 2008. UK Climate Change Programme. Annual Report to Parliament, July 2008, page 17. http://www.defra.gov.uk/environment/climatechange/uk/ukccp/pdf/ukccp-ann-report-july08.pdf

6. The figure for 1997 was 548.1 MtCO2. The provisional figure for 2007 is 543.7 MtCO2. See Table 2, Defra, July 2008, ibid.

7. Defra, July 2008. UK Climate Change Programme. Annual Report to Parliament, July 2008, page 18. http://www.defra.gov.uk/environment/climatechange/uk/ukccp/pdf/ukccp-ann-report-july08.pdf

8. The 1990 figure was 770.8 MtCO2eq. Table 2, Defra, July 2008, ibid.

9. The latest figure (2006) for all ggs is 652.3 MtCO2eq. Table 2, Defra, July 2008, ibid.

10. Defra, 15th July 2008, ibid.

11. Oliver Tickell, forthcoming. Kyoto2: how to manage the global greenhouse. Zed Books, London.

12. ibid.

Copyright (c) 2006 Monbiot.com

http://www.monbiot.com/archives/2008/07/24/traded-away/

Bill Totten http://www.ashisuto.co.jp/english/index.html

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>Obama, the prince of bait-and-switch

>I interviewed a woman who had lost eight members of her family, including six children to a US bomb – but mass murder in Afghanistan isn’t news

by John Pilger

New Statesman (July 24 2008)

On 12 July, the Times devoted two pages to Afghanistan. It was mostly a complaint about the heat. The reporter, Magnus Linklater, described in detail his discomfort and how he had needed to be sprayed with iced water. He also described the “high drama” and “meticulously practised routine” of evacuating another overheated journalist. For her US Marine rescuers, wrote Linklater, “saving a life took precedence over [their] security”. Alongside this was a report whose final paragraph offered the only mention that “47 civilians, most of them women and children, were killed when a US aircraft bombed a wedding party in eastern Afghanistan on Sunday”.

Slaughters on this scale are common, and mostly unknown to the British public. I interviewed a woman who had lost eight members of her family, including six children. A 500 pound [1100 kilogram] US Mk82 bomb was dropped on her mud, stone and straw house. There was no “enemy” nearby. I interviewed a headmaster whose house disappeared in a fireball caused by another “precision” bomb. Inside were nine people – his wife, his four sons, his brother and his wife, and his sister and her husband. Neither of these mass murders was news. As Harold Pinter wrote of such crimes: “Nothing ever happened. Even while it was happening it wasn’t happening. It didn’t matter. It was of no interest.”

A total of 64 civilians were bombed to death while the Times man was discomforted. Most were guests at a wedding party. Wedding parties are a “coalition” speciality. At least four of them have been obliterated – at Mazar and in Khost, Uruzgan and Nangarhar provinces. Many of the details, including the names of victims, have been compiled by a New Hampshire professor, Marc Herold, whose Afghan Victim Memorial Project is a meticulous work of journalism that shames those who are paid to keep the record straight and report almost everything about the Afghan War through the public relations facilities of the British and American military.

The US and its allies are dropping record numbers of bombs on Afghanistan. This is not news. In the first half of this year, 1,853 bombs were dropped: more than all the bombs of 2006 and most of 2007. “The most frequently used bombs,” the Air Force Times reports, “are the 500 pound and 2,000 pound [4400 kilogram] satellite-guided …” Without this one-sided onslaught, the resurgence of the Taliban, it is clear, might not have happened. Even Hamid Karzai, America’s and Britain’s puppet, has said so. The presence and the aggression of foreigners have all but united a resistance that now includes former warlords once on the CIA’s payroll.

The scandal of this would be headline news, were it not for what George W Bush’s former spokesman Scott McClellan has called “complicit enablers” – journalists who serve as little more than official amplifiers. Having declared Afghanistan a “good war”, the complicit enablers are now anointing Barack Obama as he tours the bloodfests in Afghanistan and Iraq. What they never say is that Obama is a bomber.

In the New York Times on 14 July, in an article spun to appear as if he is ending the war in Iraq, Obama demanded more war in Afghanistan and, in effect, an invasion of Pakistan. He wants more combat troops, more helicopters, more bombs. Bush may be on his way out, but the Republicans have built an ideological machine that transcends the loss of electoral power – because their collaborators are, as the American writer Mike Whitney put it succinctly, “bait-and-switch” Democrats, of whom Obama is the prince.

Those who write of Obama that “when it comes to international affairs, he will be a huge improvement on Bush” demonstrate the same wilful naivety that backed the bait-and-switch of Bill Clinton – and Tony Blair. Of Blair, wrote the late Hugo Young in 1997, “ideology has surrendered entirely to ‘values’ … there are no sacred cows [and] no fossilised limits to the ground over which the mind might range in search of a better Britain …”

Eleven years and five wars later, at least a million people lie dead. Barack Obama is the American Blair. That he is a smooth operator and a black man is irrelevant. He is of an enduring, rampant system whose drum majors and cheer squads never see, or want to see, the consequences of 500 pound bombs dropped unerringly on mud, stone and straw houses.

http://www.johnpilger.com

http://www.newstatesman.com/media/2008/07/pilger-obama-afghanistan-news

Bill Totten http://www.ashisuto.co.jp/english/index.html

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>The Coming Re-becoming

>Clusterfuck Nation

by Jim Kunstler

Comment on current events by the author of
The Long Emergency (Atlantic Monthly Press, 2005)

http://www.kunstler.com (July 28 2008)

Everywhere you turn in this nation, you see a society primed for implosion. We seem unaware how extraordinary the American experience has been, especially in the last hundred years. By this, I don’t mean that we are a better people than any other society – these days, ordinary people in the USA make an effort to appear thuggish and act surly, as though we were a nation of convicts – but for decade-upon-decade, we were very fortunate. Even the Great Depression of the 1930s may seem like a relatively peaceful and gentle “time out” from a frantic era of hypertrophic growth, compared to the storm we’re sailing into now.

We were fortunate to inhabit a New World filled with productive land, lots of minerals, and plenty of coal, oil, and gas; and the land itself was insulated physically from the great theaters of 20th century conflict, though we fought in wars “over there”. That experience itself, especially our victory over manifest evil in the Second World War, left us with a dangerous mentality of triumphal exceptionalism. Even now, we think we are immune to the epochal hazards of history. The notion that nothing really bad can happen to us is reflected in the blind cluelessness of our current news media and their simple failure to report what is now happening.

I drove up along an obscure stretch of the upper Hudson river on Sunday, starting in the old factory town of Cohoes, north of Albany, where the Mohawk River runs into the Hudson. There is a powerful waterfall there, and along the high bank the massive old red-brick Harmony Mill still stands with its Victorian towers and mansard roofs, like a vision from an Alfred Hitchcock movie. Behind them are streets of red-brick, three-story worker row-housing from the same period. Today they are inhabited by a different kind of poor people, not necessarily working, and probably suffering from a sheer lack of structure in their lives as well as plain poverty of means. These are people who probably don’t follow the Bloomberg financial bulletins, and their experience of a cratering economy may only be the rising cost of cigarettes and beer.

The tattoo quotient among both men and women there is impressive. In the days when the Harmony Mill was built, only South Seas cannibals and sailors wore tattoos. You wonder: are tattoos now the only way left for this class of Americans to assert their selfhood? And what exactly are they proclaiming? I am a warrior. Or is it: I am a television (I display pictures, too) !? The expanding class of the poor-and-idle has been remarkably passive in the face of their dwindling prospects. Perhaps they passed the point years ago (a generation or two ago!) when there was any sense of sequential improvement for the family’s station-in-life. The destiny of their everyday lives must seem totally beyond their control. They are subject to the fate of distant corporations who sell the staple corn-syrup byproducts and gasoline on which daily life is based. Where government is concerned, they are all potential victims of Katrina-ism, awaiting their own personal disaster.

North of the junction of the Mohawk and Hudson was the old town of Waterford, where the Erie Canal began its journey west – bypassing those powerful waterfalls. The locks are still there and still in operation for the infrequent tanker ships and ore barges that come and go to the Great Lakes. But the operation of the canal system is automated to the extent that it requires only a handful of people to run the locks now, and the town around them has deteriorated into slum and semi-slum garnished with a few convenience stores and pizza shops. There is no other commerce there. No matter how poor, the denizens are required to drive a car to a giant chain store for groceries or hardware or clothing.

As you leave Waterford, the river road becomes a suburban corridor of 1960s-vintage ranch houses and stand-alone small retail business buildings which, if used at all now, are mostly hair salons, chiropractic studios, and other services not generally rendered by the chain stores. All this stuff was deployed along the road with the expectation that Americans would be driving cars cheaply forever. Now that this is distinctly no longer the case, corridors like this are entering their death throes. The awfulness of the design and construction of these buildings is now especially vivid as the plywood de-laminates, and the vinyl soffits fall off, and the dinge of neglect forms a patina over it all. Hopelessness infects this landscape like a miasma. Whatever young adults remain in these places are not thinking about a plausible future, only looking to complete their full array of tattoos and lose themselves in raptures of sex, methedrine, and video aggression.

Eventually, after running through the disintegrating towns of Mechanicville (once a place of earnest labor, just like it sounds, now a morass of sinking car dealerships and Quik-stops), and Stillwater (smaller version of the same), the road turned completely rural and few other cars ventured up there. The decisive Revolutionary battle of Saratoga was fought near there on the bluffs and hills overlooking the Hudson in 1777. You wonder what the heroes of that battle would think of what we have become. What would they make of the word “consumer” that we use to describe our relation to the world? What would they think of excellent river bottom-land that is now barely used for farming – or, where it is still farmed (dairying if anything), of farmers who will not even put in a kitchen garden for themselves because it might detract from their hours of TV viewing?

The sclerosis of American life is shocking. If you go further north up the Hudson River, to Fort Edward and Hudson Falls, you’ll see a nation that seems ready to crawl off and die. There, it appears too far gone to even put up a proxy fight on a video screen. Frankly, I don’t want that version of America to survive – the America of chain stores, and muscle cars, and grown men obsessed with video games, drugs, and pornography, and women decorated like cannibals, and the vast, crushing purposelessness of it all. I have no doubt we’re heading into a convulsion that will wring much of this junk and dross into the backwaters of history. We’re capable of being something better than this, of putting our time on earth to better use, including a more respectful treatment of the land we inhabit. This year and the next will be the years of letting go, and out of that we’ll commence a re-becoming.

____________________________________

My new novel of the post-oil future, World Made By Hand, is available at all booksellers.

http://jameshowardkunstler.typepad.com/clusterfuck_nation/2008/07/the-coming-re-becoming.html

Bill Totten http://www.ashisuto.co.jp/english/index.html

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>What’s Wrong with the GDP?

>Since its introduction during World War II as a measure of wartime production capacity, the Gross National Product (now routinely measured as Gross Domestic Product – GDP) has become the nation’s foremost indicator of economic progress. It is now widely used by policymakers, economists, international agencies and the media as the primary scorecard of a nation’s economic health and well-being.

Yet the GDP was never intended for this role. It is merely a gross tally of products and services bought and sold, with no distinctions between transactions that add to well-being, and those that diminish it. Instead of separating costs from benefits, and productive activities from destructive ones, the GDP assumes that every monetary transaction adds to well-being, by definition. It is as if a business tried to assess its financial condition by simply adding up all “business activity”, thereby lumping together income and expenses, assets and liabilities.

On top of this, the GDP ignores everything that happens outside the realm of monetized exchange, regardless of its importance to well-being. The crucial economic functions performed in the household and volunteer sectors go entirely ignored. The contributions of the natural habitat in providing the resources that sustain us go unreckoned as well. As a result, the GDP not only masks the breakdown of the social structure and natural habitat; worse, it actually portrays such breakdown as economic gain.

GDP Treats Crime, Divorce, and Natural Disasters as Economic Gain

Since the GDP records every monetary transaction as positive, the costs of social decay and natural disasters are tallied as economic advance. Crime adds billions of dollars to the GDP due to the need for locks and other security measures, increased police protection, property damage, and medical costs. Divorce adds billions of dollars more through lawyer’s fees, the need to establish second households and so forth. Hurricane Andrew was a disaster for Southern Florida. But the GDP recorded it as a boon to the economy of well over $15 billion.

GDP Ignores the Non-Market Economy of Household and Community

The crucial functions of childcare, elder care, other home-based tasks, and volunteer work in the community go completely unreckoned in the GDP because no money changes hands. As the non-market economy declines, and its functions shift to the monetized service sector, the GDP portrays this process as economic advance. The GDP also adds the cost of prisons, social work, drug abuse and psychological counseling that arise from the neglect of the non-market realm.

GDP Treats the Depletion of Natural Capital as Income

The GDP violates basic accounting principles and common sense by treating the depletion of natural capital as income, rather than as the depreciation of an asset. The Bush Administration made this point in the 1992 report of the Council on Environmental Quality. “Accounting systems used to estimate GDP” the report said, “do not reflect depletion or degradation of the natural resources used to produce goods and services”. As a result, the more the nation depletes its natural resources, the more the GDP goes up.

GDP Increases with Polluting Activities and Then Again with Clean-Ups

Superfund clean-up of toxic sites is slated to cost hundreds of billions of dollars over the next thirty years, which gets added to the GDP. Since the GDP first added the economic activity that generated that waste, it creates the illusion that pollution is a double benefit for the economy. This is how the Exxon Valdez oil spill led to an increase in the GDP.

GDP Takes No Account of Income Distribution

By ignoring the distribution of income, the GDP hides the fact that a rising tide does not lift all boats. From 1973 to 1993, while GDP rose by over fifty percent, wages suffered a decline of almost fourteen percent. Meanwhile, during the 1980s alone, the top five percent of households increased their real income by almost twenty percent. Yet the GDP presents this enormous gain at the top as a bounty to all.

GDP Ignores the Drawbacks of Living on Foreign Assets

In recent years, consumers and government alike have increased their spending by borrowing from abroad. This raises the GDP temporarily, but the need to repay this debt becomes a growing burden on our national economy. To the extent that Americans borrow for consumption rather than for capital investment, they are living beyond their means and incurring a debt that eventually must be repaid. This downside of borrowing from abroad is completely ignored in the GDP.

WHAT IS THE GENUINE PROGRESS INDICATOR – GPI?

The Genuine Progress Indicator (GPI) is a new measure of the economic well-being of the nation from 1950 to present. It broadens the conventional accounting framework to include the economic contributions of the family and community realms, and of the natural habitat, along with conventionally measured economic production.

The GPI takes into account more than twenty aspects of our economic lives that the GDP ignores. It includes estimates of the economic contribution of numerous social and environmental factors which the GDP dismisses with an implicit and arbitrary value of zero. It also differentiates between economic transactions that add to well-being and those which diminish it. The GPI then integrates these factors into a composite measure so that the benefits of economic activity can be weighed against the costs.

The GPI is intended to provide citizens and policy-makers with a more accurate barometer of the overall health of the economy, and of how our national condition is changing over time.

While per capita GDP has more than doubled from 1950 to present, the GPI shows a very different picture. It increased during the 1950s and 1960s, but has declined by roughly 45% since 1970. Further, the rate of decline in per capita GPI has increased from an average of one percent in the 1970s to two percent in the 1980s to six percent so far in the 1990s. This wide and growing divergence between the GDP and GPI is a warning that the economy is stuck on a path that imposes large – and as yet unreckoned – costs onto the present and the future.

Specifically, the GPI reveals that much of what economists now consider economic growth, as measured by GDP, is really one of three things: (1) fixing blunders and social decay from the past; (2) borrowing resources from the future; or (3) shifting functions from the community and household realm to that of the monetized economy. The GPI strongly suggests that the costs of the nation’s current economic trajectory have begun to outweigh the benefits, leading to growth that is actually uneconomic.

If the mood of the public is any barometer at all, then it would seem that the GPI comes much closer than the GDP to the economy that Americans actually experience in their daily lives. It begins to explain why people feel increasingly gloomy despite official claims of economic progress and growth.

The GPI starts with the same personal consumption data the GDP is based on, but then makes some crucial distinctions. It adjusts for certain factors (such as income distribution), adds certain others (such as the value of household work and volunteer work), and subtracts yet others (such as the costs of crime and pollution). Because the GDP and the GPI are both measured in monetary terms, they can be compared on the same scale.

I. Crime and Family Breakdown

Social breakdown imposes large economic costs on individuals and society, in the form of legal fees, medical expenses, damage to property, and the like. The GDP treats such expenses as additions to well-being. By contrast, the GPI subtracts the costs arising from crime and divorce.

II. Household and Volunteer Work

Much of the most important work in society is done in household and community settings: childcare, home repairs, volunteer work, and the like. These contributions are ignored in the GDP because no money changes hands. To correct this omission, the GPI includes, among other things, the value of household work figured at the approximate cost of hiring someone to do it.

III. Income Distribution

A rising tide does not necessarily lift all boats – not if the gap between the very rich and everyone else increases. Both economic theory and common sense tell us that the poor benefit more from a given increase in their income than do the rich. Accordingly, the GPI rises when the poor receive a larger percentage of national income, and falls when their share decreases.

IV. Resource Depletion

If today’s economic activity depletes the physical resource base available for tomorrow’s, then it is not really creating wellbeing; rather, it is just borrowing it from future generations. The GDP counts such borrowing as current income. The GPI, by contrast, counts the depletion or degradation of wetlands, farmland, and non-renewable minerals (including, oil) as a current cost.

V. Pollution

The GDP often counts pollution as a double gain; once when it’s created, and then again when it is cleaned up. By contrast, the GPI subtracts the costs of air and water pollution as measured by actual damage to human health and the environment.

VI. Long-Term Environmental Damage

Climate change and the management of nuclear wastes are two long-term costs arising from the use of fossil fuels and atomic energy. These costs do not show up in ordinary economic accounts. The same is true of the depletion of stratospheric ozone arising from the use of chlorofluorocarbons. For this reason, the GPI treats as costs the consumption of certain forms of energy and of ozone-depleting chemicals.

VII. Changes in Leisure Time

As a nation increases in wealth, people should have increasing latitude to choose between more work and more free time for family or other activities. In recent years, however, the opposite has occurred. The GDP ignores this loss of free time, but the GPI treats leisure as most Americans do – as, something of value. When leisure time increases, the GPI goes up; when Americans have less of it, the GPI goes down.

VIII. Defensive Expenditures

The GDP counts as additions to well-being the money people spend just to prevent erosion in their quality of life or to compensate for misfortunes of various kinds. Examples are the medical and repair bills from automobile accidents, commuting costs, and household expenditures on pollution control devices such as water filters. The GPI counts such “defensive” expenditures as most Americans do: as costs rather than as benefits.

IX. Lifespan of Consumer Durables and Public Infrastructure

The GDP confuses the value provided by major consumer purchases (such as home appliances) with the amounts Americans spend to buy them. This hides the loss in well-being that results when products are made to wear out quickly. To overcome this, the GPI treats the money spent on capital items as a cost, and the value of the service they provide year after year as a benefit. This applies both to private capital items and to public infrastructure, such as highways.

X. Dependence on Foreign Assets

If a nation allows its capital stock to decline, or if it finances its consumption out of borrowed capital, it is living beyond its means. The GPI counts net additions to the capital stock as contributions to well-being, and treats money borrowed from abroad as reductions. If the borrowed money is used for investment, the negative effects are canceled out. But if the borrowed money is used to finance consumption, the GPI declines.
_____

The above text is excerpted from The Genuine Progress Indicator: Summary of Data and Methodology, Redefining Progress C1995. Copies of the full reports are available for $10.00 by contacting: Redefining Progress – http://rprogress.org/ – One Kearny Street, Fourth Floor San Francisco, California 94108 Phone: 415-781-1191; FAX: 415-781-1198.

These are the same people who wrote the cover story “If the Economy Is Up, Why Is America Down?”, in the October 1995 Atlantic Monthly. For back issues send $7 to: The Atlantic, Back Issues, 200 North 12th St., Newark, New Jersey 07107

Further reading:

The Green National Product: A Proposed Index of Sustainable Economic Welfare by Clifford W Cobb and John B Cobb, Jr (University Press of America, 1994) ISBN 0-8191-9322-4. This book is available for $24 + $5 shipping from: Society for Human Economy, Post Office Box 28, West Swanzey, New York 03469-0028

http://dieoff.org/page11.htm

Bill Totten http://www.ashisuto.co.jp/english/index.html

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>Gross National Happiness

>The tiny Himalayan kingdom of Bhutan has created a new way to define prosperity: by measuring actual well-being rather than consumption.

by Rajni Bakshi

Resurgence via Alternet (January 25 2005)

The tiny Himalayan kingdom of Bhutan is an unlikely place for the birth of an international trend. Yet Bhutan is emerging as a global leader in the promotion of “Gross National Happiness” a concept it first embraced three decades ago and which is now being fleshed out by a wide range of professionals and agencies across the world.

The term Gross National Happiness (GNH) was coined by Bhutan’s King Jigme Singye Wangchuck, when he ascended the throne in 1972. It signalled his commitment to building an economy that would serve Bhutan’s unique culture permeated by Buddhist spiritual values.

Today, the concept of GNH resonates with a wide range of initiatives, across the world, to define prosperity in more holistic terms and to measure actual wellbeing rather than consumption. By contrast the conventional concept of Gross National Product (GNP) measures only the sum total of material production and exchange in any country. Thus an international conference on Gross National Happiness, hosted by the Bhutan government in the capital city of Thimphu in 2004, attracted 82 eminent participants from twenty countries.

The evolving concept of GNH could well be the most significant advancement in economic theory over the last 150 years, according to Frank Dixon, a Harvard Business School graduate who is currently managing director of research at Innovest Strategic Value Advisors. Innovest is the largest international financial services firm catering to ethical investment funds.

“GNH is an endeavor to greatly enhance the sophistication of human systems by emulating the infinitely greater sophistication of nature”, says Dixon.

Just what would it mean for economic structures to emulate nature? Dixon and others explain it as follows. At present individual companies and entire countries are compelled to keep growing indefinitely. The only parallel for this in the natural world is cancer cells, which by growing exponentially destroy the host body and themselves.

Today it is widely acknowledged that the human economy cannot keep growing at the cost of its habitat. Yet even after two decades of expanding environmental regulation we are still losing the race to save the planet. This is partly because production systems and consumption patterns are out of sync with the carrying capacity of the planet. The pressure for ever higher GNP is merely one manifestation of this.

The concept of GNH is seen as one of several ways in which these imbalances might be rectified. The international gathering at Thimphu reflected a consensus that Gross National Product would still need to be measured and given due importance but in ways that are actually conducive to GNH. So far there has been a tendency to treat GNH as merely the well-intentioned slogan of a small country ruled by an enlightened monarch. The obvious difficulties of defining or measuring happiness have also helped to keep the concept of GNH on the outer fringes of serious discourse.

However, as the conference in Thimphu showed, basic happiness can be measured since it pertains to quality of nutrition, housing, education, health care and community life. Thus, GNH may indeed be ready to come of age. The concept is essential for anyone working on development, says Mieko Nishimizu, an economist who was formerly the World Bank’s vice president for the South Asia region and attended the Thimphu conference.

Three major factors seem to be responsible for the expanding credibility of GNH. One, there is wider awareness that GNP is a one-dimensional and thus misleading measure. Two, a wide range of indices have been devised which offer a more realistic assessment of even material prosperity. Three, there is growing pressure for an infusion of moral and cultural values into the core of economic policy.

The GNP was never intended to be a measure of actual well-being. It is the artefact of a time when it was assumed that if there are more goods in circulation, general welfare is ensured. As extensive documentation has shown, this is not always the case. Moreover, attention has also been drawn to dire side effects of the GNP-driven model of economic growth in many societies, including the US with its multiple social crises and rising sales of antidepressants.

Such critiques are not new. Back in 1968 Robert Kennedy lamented that the GNP also grows because of the sales of rifles and knives and “television programs which glorify violence in order to sell toys to our children … (it) does not allow for the health of our children, the quality of their education, or the joy of their play”.

Since 1995, an Oakland-based think tank called Redefining Progress has been annually assessing the American economy with an alternative yardstick called the Genuine Progress Indicator (GPI), which presents a relatively grim picture of American society compared to the GDP (as GNP is called in the US).

The GPI index gets closer to the reality of people’s lives in the following ways. It includes the household and volunteer economy which is completely ignored by the GNP. It notes as a “loss” all money spent on either preventing crime or repairing damage caused by it. Similarly all money spent on water filters, air purification and other ways of coping with environmental degradation is counted as a loss. Likewise money that goes into circulation because of car crashes and divorces is noted as a loss. The GPI also takes into account the extent to which the whole population shares in increasing material abundance.

The GPI is just one among several endeavors to evolve new indicators that measure actual conditions of human wellbeing. Some of the pioneers in developing such indicators were present at the GNH conference in Thimphu, including Frank Bracho of Venezuela, who was ambassador to India in the early 1990s. Bracho pointed out that though countries as diverse as Costa Rica, Canada, Iceland, the Netherlands, Sri Lanka and Mongolia have established well-being indicators, the hegemony of the GNP measure remains in place.

This is why Bhutan’s insistence on the primacy of GNH over GNP inspires people far beyond its borders. Bhutan’s commitment to GNH has meant that moral and ethical values are placed at the core of its economic strategies for ensuring better food, housing and health for a population of just over 710,000 people. GNH has allowed Bhutan to both expand its network of roads and increase its forest cover. In most other developing countries the arrival of roads is inevitably followed by deforestation. This is not to suggest that all is well in the Kingdom of Bhutan or that it is able to fully live up to its GNH commitment. Yet its achievements are remarkable.

The wide range of people present at the conference was largely due to the engagement of Sander Tideman, from Holland, who was once a banker and is currently coordinator for the Spirit in Business network. Tideman says that though Bhutan’s move toward GNH has been more of a guiding principle than an actual form of measure, its impact has been powerful. For example, the government has restricted tourism in order to prevent its eroding impacts on local cultural values. This has allowed temples in Bhutan to remain places of study, worship and spiritual practice rather than mere tourist attractions.

The declaration adopted by participants at the Thimphu conference said that the facilitation of GNH should be accompanied by “the development of indicators that address human physical and emotional well-being. They must be capable of use for self-evaluation, so that individuals and groups may gauge their progress in the attainment of happiness. In addition, indicators should facilitate full accountability, good governance, and socially constructive business practices, both in day-to-day life and in long-range policies and activities.”
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Rajni Bakshi is a journalist based in Mumbai.

http://www.alternet.org/environment/21083

Bill Totten http://www.ashisuto.co.jp/english/index.html

Categories: Uncategorized

>Our Phony Economy

>by Jonathan Rowe

From testimony delivered March 12 before the Senate Committee on Commerce, Science, and Transportation, Subcommittee on Interstate Commerce. Rowe is codirector of West Marin Commons, a community-organizing group, in California.

Harper’s Magazine Essay (June 2008)

Suppose that the head of a federal agency came before this committee and reported with pride that agency employees had burned ten percent more calories at work last year than they did the year before. Not only that – they had spent ten percent more money too. I have a feeling you would want to know more. What were these employees doing when they burned those calories? What did they spend that money on? Most important, what were the results? Expenditure is a means, not an end, and to assess the health of an agency, or system, you need to know what it has accomplished, not just how much motion it has generated and money it has spent. The point seems obvious, yet Congress ignores it every day when it talks about “the economy”. The administration and the media do it, too. Every time you say that “the economy” is up, or that you want to “stimulate” it, you are urging more expenditure and motion without regard to what that expenditure is and what it might accomplish, and without regard to what it might crowd out or displace in the process.

That term “the economy”: what it means, in practice, is the Gross Domestic Product – a big statistical pot that includes all the money spent in a given period of time. If the pot is bigger than it was the previous quarter, or year, then you cheer. If it isn’t bigger, or bigger enough, then you call Federal Reserve Chairman Ben Bernanke up here and ask him to do some explaining. The what of the economy makes no difference in these councils. It never seems to come up. The money in the big pot could be going to cancer treatments or casinos, violent video games or usurious credit-card rates. It could go toward the $9 billion or so that Americans spend on gas they burn while they sit in traffic, or the billion plus that goes to such drugs as Ritalin and Prozac that schools are stuffing into kids to keep them quiet in class. The money could be the $20 billion or so that Americans spend on divorce lawyers each year, or the $41 billion on pets, or the $5 billion on identity theft, or the billions more spent to repair property damage caused by environmental pollution. The money in the pot could betoken social and environmental breakdown – misery and distress of all kinds. It makes no difference. You don’t ask. All you want to know is the total amount, which is the GDP. So long as it is growing then everything is fine.

I am not talking about an obscure technical measure. This is not stuff for the folks in the back room. I am talking about what you mean when you use that term “the economy”. Few words induce such a reverential hush in these halls. Few words are so laden with authority and portent. When you say “the economy” is up, no news is better. When you argue that a proposal will help the economy or hurt it, then you have played the ultimate trump card in your polemical deck, bin Laden possibly excepted.

This, by the way, is not an argument against growth. To be reflexively against growth is as numb-minded as to be reflexively for it. Those are theological positions. I am arguing for an empirical one. Find out what is growing and the effects. Tell us what this growth is, in concrete terms. Then we can begin to say whether it has been good.

The failure to do this is insane. It is an insanity that is embedded in the political debate and in media reportage, and it leads to fallacy in many directions. We hear, for example, that efforts to address climate change will hurt “the economy”. Does that mean that if we clean up the air we will spend less money treating asthma in young kids? The atmosphere is part of the economy, too – the real economy, that is, though not the artificial construct portrayed in the GDP. It does real work, as we would discover quickly if it were to collapse. Yet the GDP does not include this work. If we burn more gas, the expenditure gets added to the GDP. But there is no corresponding subtraction for the toll this burning takes on the thermostatic and buffering functions that the atmosphere provides. (Nor is there a subtraction for the oil we take out of the ground.) Yet if we burn less gas, and thus maintain the crucial functions of the atmosphere, we say “the economy” has suffered, even though the real economy has been enhanced.

With families the logic is the same. By the standard of the GDP, the worst families in America are those that actually function as families – that cook their own meals, take walks after dinner, and talk together instead of just farming the kids out to the commercial culture. Cooking at home, talking with kids, walking instead of driving, involve less expenditure of money than do their commercial counterparts. Solid marriages involve less expenditure for counseling and divorce. Thus they are threats to the economy as portrayed in the GDP. By that standard, the best kids are the ones who eat the most junk food and exercise the least, because they will run up the biggest medical bills for obesity and diabetes.

This assumption has been guiding our economic policies for the past sixty years at least. Is it surprising that the family structure is shaky, real community is in decline, and children have become petri dishes of market-related dysfunction and disease? The nation conceives of such tilings as growth and therefore good. It is not accidental that the two major protest movements of recent decades – environmentalist and pro-family – both deal with parts of the real economy that the GDP leaves out and that the commercial culture that embodies the GDP tends to erode. How did we get to this strange pass, where up is down and down is up? How did it happen that the nation’s economic hero is a terminal-cancer patient going through a costly divorce? How is it that Congress talks about stimulating “the economy” when much that will actually be stimulated is the destruction of things it says it cares about on other days? How did the notion of economy become so totally uneconomic?

The story begins in Ireland in the 1650s. British troops had just repressed another uprising there, and the Cromwell government had devised a final solution to put its Irish problem to rest. The government would remove a significant portion of the populace – Catholics in particular – to remote parts of the island. Then it would redistribute their lands to British troops, thus providing compensation to them and establishing an occupational presence for the benefit of the government in London. The task of creating an inventory of the lands went to an army physician by the name of William Petty, a quick study and a man with an eye for the main chance. He classified much land as marginal that actually was quite good. Then he got himself appointed to the panel that made the distributions and bestowed much of that land upon himself. Petty’s survey was the first known attempt in Western history to create a total inventory of a nation’s wealth. It was not done for the well-being of the Irish people but rather to take their land away from them. It was an instrument of government policy, and this has been true from that time to the present. Governments have sought to catalogue the national wealth for purposes of taxation, confiscation, planning, and mobilization in times of war. They have not designed these catalogues to be measures of national wellbeing or of quality of life. Yet that is how the national wealth inventories have come to be used, especially the GDP. Somehow the tool has become the task. This part of the story begins with the Great Depression.

In the early 1930s, as the United States sank deeper into an economic slough, Congress faced an absence of data to help guide the way out. It didn’t know exactly what was happening and where. There were no systematic figures on unemployment or production. President Herbert Hoover had dispatched six employees from the Commerce Department to travel around the country and file reports. These were anecdotal and tended to support Hoover’s view that recovery was just around the corner. Members of Congress wanted more. Senator Robert M La Follette Jr, a Republican of Wisconsin, introduced a resolution to require the Commerce Department to develop a spreadsheet – as we would call it today – of the economy with its component parts. La Follette was a Progressive in the original sense. He believed in “scientific management and planning”, and the resolution was to produce a tool to that end. It passed in 1932, and the work fell to one Simon Kuznets, a professor who was working at the National Bureau of Economic Research in New York. Kuznets knew that he was producing a policy tool and not a measure of living standards or well-being. As he put it later in his clinical prose, the goal was to help understand the “relations and relative importance of various parts of the productive system and their responsiveness to various types of stimulae as shown by their changes in the past”. Kuznets had a tiny staff and virtually no budget. Data sources were fragmentary. But about a year and a half later, Kuznets, with brevity and candor that are rare today, laid out for Congress the limitations of the accounts he had constructed. He took particular pains to tell you why you should not use these accounts the way you – and the press – have come to use them.

For one thing, the national accounts leave out a crucial dimension of the economy – the part that exists outside the realm of monetary exchange. This segment includes both the ecosystem and the social system – the life-supporting functions of the oceans and atmosphere, for example, and work within families and communities that is not done for money. So when the monetized economy displaces these elements – as when both parents have to work, or when forest clearing eliminates the cleansing function of trees – the losses are not subtracted against the market gain. Kuznets was under no such illusion. “The volume of services rendered by housewives and other members of the household toward the satisfaction of wants must be imposing indeed”, he wrote. There is also the question of what he called “odd jobs”, or what we would call the “underground economy. “He knew these played a large role in the economy. He also grasped, more broadly, that the quality and importance of a function do not depend upon the amount of money paid for it – or whether any money was paid at all. The care of a mother and father is not inferior to that of a day-care worker just because they do not charge a price for their services. This recognition undercuts a basic assumption behind the GDP – namely, that the contribution of an activity can be gauged solely by its market price. But there is a practical problem, Kuznets observed. Accounts require data, and there is by definition little data on the underground economy and on nonmarket exchange. As a result, the national accounts include only the slice of economic reality that falls within the bandwidth that economists are able to grasp – recorded expenditures of money.

Then there is the thorny question of constructive versus destructive activities within the realm of monetized exchange. Once you have decided to count only that which is transacted through money, do you make the further assumption that everything transacted for money counts on the plus side of the ledger? The mentality that lies behind the GDP assumes that you do. We all are “rational”, so any choice we make in the market is by definition one that makes our lives better. Kuznets focused on one obvious exception: activities that are generally illegal, such as gambling and selling drugs. To assume that such expenditures add to the national well-being would undercut the rationale for making them illegal in the first place. The GDP is an instrument of the state, after all, so Kuznets drew the line there. He was aware of how arbitrary this line is from an economic standpoint. Why exactly does legal gambling add to well-being if the illegal kind does not? Or what about alcohol? Given the assumption that legality confers benediction, the economy received a huge boost at the end of Prohibition, simply because the drinking that formerly was illegal now was deemed permissible. But booze still was booze. If the government can increase the growth race by jiggering the metrics in this way, that does not increase confidence in the validity of measure. But legality is the easy part. Just beneath it lies a deeper issue – the assumption that every purchase is beneficial simply because someone has paid the purchase price. The exclusion of illegal activities, Kuznets said, “does not imply … that all lawful pursuits are necessarily serviceable from the social viewpoint”. He left the question there, a chasm that honest inquiry has to plumb.

There are so many examples of expenditures that go into the GDP that have a questionable claim to the stature of growth and good, even from the standpoint of those who make them. For example, much consumption is compulsory, in that buyers have little choice. There is fraud, such as the way seniors are cheated in reverse-mortgage scams. There are also products that are designed to lock buyers into an endless stream of high-priced replacements, such as inkjet-printer cartridges that are designed to resist refilling. There are car bumpers that are designed not to bump, so that a mild fender bender turns into a $5,000 repair bill. There are the usurious charges and fees built into credit cards. Not all Americans confronted with these expenditures regard them as “consumption choices” that propel them further up a happy mountain of more.

The toughest case for the economic mind is addiction. The GDP assumes, as most economists do, that people are inherently “rational”. What they buy is exactly what they want, and so their purchases must make them happy in exact proportion to the prices paid. Yet addiction has become pervasive. It has metastasized far beyond the usual suspects – gambling, tobacco, alcohol, and drugs – and spread to such things as eating, credit cards, and shopping itself. Also neglected is what economists call “distribution”. The GDP makes no distinction between a $500 dinner in Manhattan and the hundreds of more humble meals that could be provided for the same amount. A socialite who buys a pair of $800 pumps from Manolo Blahnik appears to contribute forty times more to the national well-being than does the mother who buys a pair of $20 sneakers for her son at Payless. “Economic welfare”, Kuznets wrote, “cannot be adequately measured unless the personal distribution of income is known”. As included in the national accounts, an accretion of luxury buying at the top covers up a lack of necessary buying at the bottom. As the income scale becomes more skewed, the cover-up becomes even greater. In this respect the GDP serves as a statistical laundry operation that hides the suffering at the bottom. Another problem has to do with work and the toll it takes on those who do it. Kuznets called this the “reverse side of income, that is, the intensity and unpleasantness of effort going into the earning of income”. That earning comes at a cost of wear and tear upon the body and psyche. If the GDP subtracts depreciation on buildings and equipment, should there not be a corresponding subtraction for the wearing out of people?

What about the loss in the value of their skills as one technology displaces another? In the current accounting, this toll often gets added to the GDP rather than subtracted, in the form of medications, expenditures for retraining, and day care for children as parents work longer hours. Most workers would regard such outlays as costs, not gains. Had Kuznets been writing today, moreover, he probably would have added another kind of depletion – that of natural resources. It sounds incredible, but when this nation drills its oil and mines its coal, the national accounts treat this as an addition to the national wealth rather than a subtraction from it. The result is like a car with a gas gauge that goes up as the fuel tank empties. The national accounts portray a nation getting richer when it is in fact draining itself dry. Kuznets concluded his report with words that ought to be inscribed on the wall of every office on Capitol Hill and over every computer screen within a twenty-mile radius: “The welfare of a nation can, therefore, scarcely be inferred from a measurement of national income as defined above”.

Congress and everybody else have done exactly what Kuznets urged us not to do. The malpractice began with the gradual seep of the new accounts into the political arena. In his 1936 reelection campaign, Franklin Roosevelt noted that the economy – as defined by the national accounts – had increased under his watch. It was a number: who could resist? The likely source was FDR’s close adviser Harry Hopkins, whose office was a hub for the young economists who came to Washington to join the New Deal. But in the passage across 15th Street from the Commerce Department to the White House, Kuznets’s numbers were turning into precisely what he said they, should not be. Then came World War II, when the national accounts played a central role in the mobilization effort. A bitter debate erupted in Washington over the nation’s production goals. Corporate leaders insisted that the mobilization must come out of the existing level of production. They did not want to be stuck with excess capacity when the war was over. Kuznets and others argued to the contrary that the United States had vast troves of untapped capacity; they used the national accounts to prove it. FDR sided with the “allouters”, as this group was called. They appealed to his belief in the energizing effects of challenges; Roosevelt took their high estimates and made them even higher, the better to make his point. (The planners then had to shift gears to argue the case for system limits, which the national accounts also helped them do.) Then the accounts helped to coordinate the war production so as to prevent bottlenecks. By 1944 war production goals alone had surpassed the nation’s entire output just ten years earlier.

It was as close as the nation has ever come to pure economic planning, and though much reviled, it helped to win the war. Postwar surveys revealed that Germany had no such planning tool, and Hitler’s production program had been greatly hindered as a result. America had become the “arsenal for democracy” in part through a top-down approach made possible by the national accounts. As the war was winding down, the accounts served again to guide the economy back to peacetime without relapse into the dreaded Depression. Consumption was essential; the Cold War, with its Pentagon spending, was not yet in prospect. As war production diminished, shoppers would have to pick up the slack. The national accounts showed exactly how it could be done. As John Kenneth Galbraith put it in Fortune, “One good reason for expecting prosperity after the war is the fact that we can lay down its specifications”.

The new Keynesian economists such as Galbraith were now the Merlins of prosperity, and the national accounts were their magic wand. Consumption itself was taking on a heroic stature; the returning troops were handing off the mantle of national purpose to the shoppers who would replace them in keeping the industrial machinery in motion. (The heroic imagery persists in the press today, as when we read that consumers will provide the “engine” for recovery, or that they will “pull” the nation out of its recession.) In this atmosphere, it was perhaps inevitable that the map of the nation’s capacity would become a totem to its economic success. Simon Kuznets watched, it happen with increasing dismay. (Galbraith came to have second thoughts as well.) Kuznets was a quiet academic who was loath to mount a soapbox. But he asserted over and over that those who had seized upon his handiwork had missed the point. In 1962 he wrote in The New Republic that in evaluating growth “distinctions must be kept in mind between quantity and quality of growth, between its costs and return, and between the short and the long run … Goals for ‘more’ growth should specify more growth of what and for what”. If you are going to “stimulate” the economy, in other words, could we at least have a little debate over what exactly you are going to stimulate?

The purpose of an economy is to meet human needs in such a way that life becomes in some respect richer and better in the process. It is not simply to produce a lot of stuff. Stuff is a means, not an end. Yet current modes of economic measurement focus almost entirely on means. For example, an automobile is productive if it produces transportation. But today we look only at the cars produced per hour worked. More cars can mean more traffic and therefore a transportation system that is less productive. The medical system is the same. The aim should be healthy people, not the sale of more medical services and drugs. Now, however, we assess the economic contribution of the medical system on the basis of treatments rather than results. Economists see nothing wrong with this. They see no problem that the medical system is expected to produce thirty to forty percent of new jobs over the next thirty years. “We have to spend our money on something”, shrugged a Stanford economist to the New York Times. This is more insanity. Next we will be hearing about “disease-led recovery”. To stimulate the economy we will have to encourage people to be sick so that the economy can be well.

Bill Totten http://www.ashisuto.co.jp/english/index.html

Categories: Uncategorized

>Political Parties, Corporations and the Truth

2008/07/28 1 comment

>by Timothy V Gatto

Countercurrents.org (July 26 2008)

In this article I am going to make one last attempt to clarify my views on this presidential race, US foreign policy, the economy and what we are experiencing in this new era as far as our civil liberties, the constant threats (real and perceived) to our “security” and the increasing gap between the rich and the not so rich in this country. One could write a book about each of these subjects, putting everything in one article is a daunting task. I’m not an expert nor am I an economist, diplomat or a military genius. What I am attempting to do is separate fact from fiction as I see it. I’m sure that many will take exception to what I have to say and that’s understandable, we all can’t be mirror images of each other. I ask your indulgence beforehand.

Since the end of the Cold War, the United States has emerged as the leading superpower. This is not because we are better or smarter than other nations; it is because we have basically been on a war-footing since World War II and have outspent more on our military than the next twenty countries combined. When the Soviet Union fell, we had no reason to continue to fund our military at Cold War levels, but our economy was so dependent on our Military Industrial Complex. The United States could have shifted its focus from producing weapons and funding our huge military machine to projects like rebuilding our infrastructure and finding alternative energy sources to reduce our dependence on foreign oil. The problem with changing our focus from military spending to a peacetime economy was that the defense industry sector was a key player in our political structure. The influence of right wing conservatives that made up the Project for a New American Century (PNAC) that called for projecting American power throughout the world and installing friendly democracies in key strategic regions warranted continuing the high level of military spending.

During the Clinton and then the Bush administrations, the Federal Government basically took the hands-off approach as far as regulating business. Huge mergers, predatory lending practices, free-trade agreements and tax breaks to companies that were outsourcing their labor force to other nations led to decreased competition and contributed to rising unemployment. The practice of cutting benefits and pay cuts as cost saving measures while CEOs and other top echelon executives were paid in the hundreds of millions, even though their companies were running in the red, faced little opposition from labor unions that had lost much of their clout while others worked hand in hand with management. The disparity between the rich and the poor increased so that now, the ten percent of the wealthiest families in the US hold 71% of this nation’s wealth, leaving 29% of wealth to be distributed by the remaining ninety percent.

Some sectors of the economy, Big Oil, the Pharmaceutical Industry, Banking and Investment, Insurance companies, the Defense industry and Lawyers made heavy contributions to politicians, gaining unprecedented clout in regard to influencing government policy. Huge contributions to political campaigns became essential if a politician wanted to keep his or her job. Campaigns became more expensive and many elected officials realized that corporate support was a necessity. The media was bought up by corporate entities and the large networks were bought up five or six corporate groups. The era of networks owned by networks ended. The large media groups were now owned by corporate entities, mostly owned by the defense industry, primarily GE and Westinghouse, two of the largest defense contractors in the country. This and “corporate personhood” that guaranteed corporations first amendment rights, meant that much of the content in the mainstream media, was controlled by a few select industries. Self-censorship of network content in order not to incur the wrath of owners or advertisers became paramount to the network executives. The United States gradually entered a phase of corporate influence that some call the “Corporacracy”. The government eventually became not a “Government by the people and for the people”, becoming a “Government by the corporations and for the corporations”.

The attacks of September 11 2001 ushered in The Global War on Terrorism. This became the replacement for the Cold War and justified the huge expenditures for the military, keeping the defense industries and the stock market thriving. Eisenhower’s warning to “Beware the Military-Industrial-Complex” had become a reality. The largest slice of the nation’s discretionary budget is spent on the defense industry. The fall of the Soviet Union meant a larger NATO, and many more overseas military bases for the Armed Forces. We immediately invaded Afghanistan, holding Osama Bin Laden responsible for 9/11, even though, to this day, a criminal investigation has never been done. The ultimate result was the creation of the Department of Homeland Security, the largest agency created since the administration of President Franklin Roosevelt.

The Global War on Terrorism ushered in many new laws to protect the security of the United States. New laws such as the Patriot Act have been passed, which allows the government to search a citizen’s home without their knowledge or presence, and with no obligation to even tell the person after the fact, if he or she happens to be unfortunate enough to be deemed a “terrorist suspect” or a “terrorist sympathizer”. There are many more provisions such as a “No-Fly List” that prevents a suspected terrorist, or a terrorist sympathizer, from flying on a commercial airliner. Passports are now required to enter or come in from Mexico and Canada as well as other nations that previously did not require a passport. The new passport now carries a chip that contains much of your personal information. The Military Commissions Act of 2006 allows the Federal Government to arrest anyone without a warrant, and to hold them indefinitely without counsel, and to try them in a military tribunal. Extraordinary Rendition is a practice of seizing individuals suspected of terrorism and flying them to nations that practice torture so as to extract information vital to “national security”.

The John Warner Defense Bill (the re-vamped Insurrection Act) allows the President to federalize State National Guards and use them as law enforcement in any US State or territory over the objections of the State Governor. This effectively repeals Posse Comitatus that was passed in 1867 that prohibits Federal troops from acting as law enforcement in order that the military could not be used to effectively promote a dictatorship. These laws that were designed to promote the security of the country against terrorists, but these laws have also drastically reduced the civil liberties of American Citizens. The writ of Habeas Corpus has effectively been eliminated; this is the right to be presented with the evidence of a crime, and the right to be tried by a jury of peers, and the right to have a swift speedy trial that was written into the cornerstone of English and American common-law, the Magna Charta in 1215.

Other violations of civil liberties such as American citizens being subject to electronic surveillance and wiretapping without a warrant have also taken place. In violation of the law which established the FISA Court which requires the Federal Government to request a warrant at least 72 hours after the fact, were ignored. Presidential Directive 51 which establishes continuity of government in the event of a “national emergency” declared by the President has been written. This document, which basically gives dictatorial power to the President without authorization by Congress, has parts of it that are classified as “secret”. This directive is so secret, that members of the Senate and House Intelligence Committees that possess the highest security clearances have not been allowed to see it. What could possibly be so secret that members of Congressional Intelligence Committee members can’t see it?

Many Americans disapprove of many of the decisions by the Executive Branch and Congress. The Bush Administration has been seen by many as an advocate of executive power and a danger to civil liberties. Allegations of torture and admissions of water-boarding, sleep depravation, sensatory deprivation, subjecting suspected terrorists to extreme heat and cold, slapping them around, being threatened by dogs and many other examples have surfaced. International Law on the treatment of prisoners has been broken. Many people around the world, and some people in America, expect the International Court to eventually file charges against members of the US Government, to include President Bush and Vice-President Cheney. Impeachment articles against President and Vice-President have been introduced in Congress.

Everything written in this article has been illustrated to underscore the issues that we currently face as a nation. We are coming up on a Presidential election that will determine who will succeed this President. We are faced with a world that believes the allegations of torture by our government. We invaded Iraq on the premise that Saddam had WMD’s which proved to be false, killing over a million Iraqi’s and displacing another two million. We have almost destroyed their infrastructure. We have used over two hundred fifty tons of depleted uranium in our ordinance that is still on the ground emitting radiation that has caused the level of childhood leukemia to rise by six hundred percent (600%). Deformed children and the increase in all kinds of cancer have been reported. American soldiers have been exposed to radiation from DU and this affects their DNA and is responsible for many babies born in the US that fail to thrive and many children that have suffered their hearts exploding at four to eight months of age – www.BeyondTreason.com. The economy is crippled by rampant capitalism and deregulation. American citizens are losing their homes to foreclosures due to predatory banking practices and the government is bailing out the banks and ignoring the homeowners. People are losing health benefits due to unemployment, firms that hire on a part-time 35 hour work week, and cost-cutting measures. 42% of Americans have either no health insurance or are under-insured. Unemployment has reached a 25 year high.

The Republicans are offering up Senator John McCain for the presidency. By all that has been said so far, he earnestly expects to “win” in Iraq without even proposing what the definition of “winning” is. He has said that he will follow the economic policies of George W Bush. That means more “hands-off” behavior when it comes to regulating certain business practices that are hurting the economy. With a McCain presidency we can expect more Federal bailouts for banks and other industries, and no relief for the middle-class. We can expect to see more tax breaks for the wealthy, so that the divide between the Middle-Class and the wealthy, is even greater. We can expect more free trade agreements that could lead to more out-sourcing. We can look forward to more of our civil liberties lost to “protecting national security”. We can look forward to a continuation of the Global War on Terror and continued defense spending at the current rate as our economy becomes even more crippled and we stay dependent on fossil fuels that are heading the causes of global warming.

The Democrats are offering up Senator Barack Obama. This is a junior Senator with no executive experience. The Democratic presumptive nominee has already committed another two Army Divisions to the war in Afghanistan while leaving a “residual force” in Iraq, thus continuing this premise of the Global War on Terror. He has not committed to lowering the defense budget. He has reneged on his opposition to strike immunity from prosecution for illegal electronic eavesdropping on American citizens by the telecoms. He has not come forward in opposition to the Patriot Act and the other draconian acts committed by the Bush Administration. He has pandered to AIPAC by threatening Iran with attack and supporting Jerusalem as the Israeli Capitol under Israeli control. He has threatened to invade Pakistan to fight the Taliban thereby increasing the scope of the war. The corporate control of the media and the body politic has not been addressed. The liberal wing of the Democratic Party has been virtually ignored. Senator Obama snubbed his nose at Netroots Nation, the so-called “Progressive” bloggers of Democrats and liberals. Senator Obama claims that he receives most of his financial support from small donations of middle income supporters. This is a not exactly the truth. Investment bankers and hedge fund managers are among his largest donors. “Bundled” contributions are the bread and butter of the Obama campaign.

The world sees the United States as the biggest supporter of Israel’s right-wing government. Israel continues to build settlements on the West Bank and keeps the inhabitants of Gaza in a virtual “lockdown”. Bulldozers still raze homes in Gaza and unarmed young men are shot on a regular basis by the Israeli Defense Force. The J Street Coalition of liberal Jews claims to represent sixty percent of Jews in America. AIPAC, which J Street claims only represents thirty percent of Jewish Americans is the target of Senator Obama’s affection. Why? What is it about AIPAC that draws politicians in like moths to a light? The answer I come up with is money. Money and the fact that Republicans that lean hard right support AIPAC along with religious zealots like Reverend Hagee who seems to believe that once Jerusalem is entirely in Israeli hands, God can then fulfill the Bible’s prophesy and start the “rapture” and Hagee and his followers can enter the kingdom of heaven. I wonder if they’ll meet the Muslim suicide bombers and their 72 virgins hanging out at Saint Peter’s gate.

The two corporate political parties have their two corporate candidates. I see Cynthia McKinney as the favored candidate of the true left in America. She has ballot access and she isn’t afraid to condemn the loss of civil liberties in America, nor does she hesitate to criticize the pandering of both corporate politicians to the military industrial complex. She is highly critical of Israel and also speaks out on the corporate controlled media. The Greens, which in my mind are born-again feudalists, are extremely lucky to have her. She just might qualify for matching campaign funds for the Green Party. Brian Moore of the Socialist Party is, in my opinion, the best candidate … but only intellectually. The lack of ballot access for the Socialists, and the hangover from the Cold War, leaves many Americans afraid of the name Socialist. I believe that if the same corporate control of the two political parties, that are essentially not too different from one another continues, those Americans that find the divide between the rich and middle class (if we still have a middle class), will find the message of the Socialists more attractive than at any time in the past. Their support of strong unions and a return to a peacetime economy will become much more attractive. While Senator Obama gets the Democrats misty-eyed with his talk of change and tearing down walls, in reality, change will be the last thing we’ll see in an Obama presidency, and the walls of distrust between the corporatists, the wealthy and the rest of us, will be higher than ever. Until real limits are legislated on campaign financing, the corporate money will continue to rule the two major political parties, along with the corporate media that will promote them.

Unless Americans start to look past the hype that the mainstream media provides to their myopic vision of this so-called two-party system, the future seems bleak indeed for the average middle-class citizens. To get a clear understanding of modern politics today, one needs only to follow the money in the political arena to see who will emerge as the victor in this particular election. It seems to me the cruelest joke that is being played today is on all of the young people in this country that see a champion in Barack Obama and his mantra of “change”. I believe that the disillusionment that they will feel when the changes they are hoping for fail to materialize, it will bring a backlash of epic proportions. Maybe then the Socialists will start looking pretty good in a world separated by those that have and those that don’t.

timgatto@hotmail.com

www.liberalpro.blogspot.com

http://www.countercurrents.org/gatto260708.htm

Bill Totten http://www.ashisuto.co.jp/english/index.html

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