Don’t Ignore How Others See Us

by Ralph Nader

The Nader Page (April 25 2013)

In watching the massive media coverage and the reaction to the brutal bombing at the finish line of the Boston Marathon, the wise poem “To A Louse …” composed in 1785 by the Scottish poet Robert Burns came to me:

O wad some Pow’r the giftie gie us

To see oursels as ithers see us!

English translation:

And would some Power the small gift give us

To see ourselves as others see us!

What must the “ithers” in the Middle East theatre of the American Empire think of a great city in total lockdown from an attack by primitive explosives when Iraqis, Afghans, Pakistanis and Yemenis experience far greater casualties and terror attacks several times a week? Including what they believe are terror attacks by US drones, soldiers, aircraft and artillery that have directly killed many thousands of innocent children, women and men in their homes, during funeral processions and wedding parties, or while they’re working in their fields.

Here’s what they are thinking: that America is very vulnerable and ready to shake itself upside down to rid itself and protect itself from any terror attacks. The Bush regime, after 9/11, sacrificed US soldiers and millions of innocents in the broader Middle East, drained our economy, so as to ignore the necessities of saving lives and health here at home, and metastasized al-Qaeda into numerous countries, spilling havoc into Iraq and now Syria. We have paid a tremendous price in blowback, because of Mr Bush’s rush to war.

Why is the reaction to the events in Boston viewed by some as bizarre? Our president said “We will finish the race”. Do we really think that the attackers are doing this to disrupt our pleasure in foot racing?

The attackers, be they suicide bombers over there or domestic bombers here, are motivated by their hatred of our invasions, our daily bombings, our occupations, our immersion in tribal preferences leading to divide-and-rule sectarian wars. Studies, such as those by the University of Chicago Professor Robert Pape, and former adviser to Barack Obama and Ron Paul during the 2008 presidential campaign, conclude that entry into paradise is not the motivation for these suicide bombers. What drives them is their despair and their desire to expel the foreign invaders from their homeland.

Another “ithers’ – admittedly a smaller number – must see a giant country going berserk with media, speculation, rumors, accusations, and random mobilizations of military equipment. There are enough of these younger people who must say to themselves, maybe it is worth giving up their lives for a place in history – to make a nation be fearful because of their rulers’ staggering overreaction.

Why give these contorted young minds, frustrated by what they perceive as US attacks on their religion or their ethnic group in their home countries, such incentives?

Massive overreactions by the mass media (have you seen CNN’s frenzied, nonstop quest for every bit of trivia and speculation hour after hour?) crowds out coverage of far greater preventable loss of life and safety in our country. Other commentators have covered the lesser-known yet huge explosion at the West Texas fertilizer factory that destroyed far more property and took more human lives than the Boston Marathon assault. But, the fertilizer plant explosion was corporate criminal negligence, or worse.

Every day in the US there are preventable tragedies that receive no media coverage because they aren’t part of the “war on terror”, which has been crowding out stories that would have led to corrective actions to leave this country safer from the corporate predators within its borders.

Individually, many Americans intuitively understand the consequences of neglecting problems in our own country to engage in lawless wars and military adventures. Unfortunately, Americans collectively sing the song “que sera, sera” or “whatever will be, will be” because the big boys in Washington and Wall Street will always make the decisions. Be assured that they will often be stupidly harmful in the long-run to our country, and not just to millions of defenseless people abroad who have become victims of the collective punishment or random ravages of our massive push-button weapon systems.

In an impressive collection of excerpts titled Against the Beast, a Documentary History of American Opposition to Empire (2004) edited by John Nichols; the eminent historian Chalmers Johnson had this to say:



… where US-supported repression has created hopeless conditions, to US-supported economic policies that have led to unimaginable misery, blowback reintroduces us to a world of cause and effect.



At a first-ever Senate hearing earlier this week on the use of armed drones away from battlefields, initiated by Senator Richard Durbin (Democrat, Illinois) and arrogantly boycotted by the imperial Obama Administration, Farea al-Muslimi, a young Yemeni from a village just attacked by a US drone strike, gave witness. Al-Muslimi said,



When they think of America, they think of the terror they feel from the drones that hover over their heads, ready to fire missiles at any time. What radicals had previously failed to achieve in my village, one drone strike accomplished in an instant: there is now an intense anger and growing hatred of America.



Watch the full testimony here:

As President Obama told the Israelis about the Palestinians, “Put yourselves in their shoes”.

In country after country, the terrifying whine of 24/7 hovering drones and the knowledge that special US killing teams can drop from the skies at any time, creates a state of terror.

A brute-force foreign policy waging war can never effectively wage peace or sensibly engage in early conflict prevention or resolution. An illegal brute-force policy aligns itself with repressive regimes that crush their own people with American weapons and American political/diplomatic cover.

Jeremy Scahill, author of the new book Dirty Wars: The World is a Battlefield (2013), who has been in these countries and spoken with these villagers, says that our government has created unnecessary enemies and banked lots of revenge among these people over the past ten years. “This is going to boomerang back around to us”, he fears, adding that we’re creating “a whole new generation of enemies that have an actual grievance against us … have an actual score to settle”. Killing innocent men, women and children creates blowback that lasts for generations.

From these overseas regions, the message from the bombing at the Boston Marathon is that, until now, the high-tech buttons were only being pushed by the drone operators against them. After Boston they can see that other low-tech buttons can now be pushed inside the US against defenseless gatherings of innocent people.

For our national security, the American people must recover control of our runaway, unilateral presidency that has torn itself away from constitutional accountabilities and continues to be hijacked by ideologues who ignore our Founding Fathers’ wisdom regarding the separation of powers and avoiding foreign entanglements that become costly, deadly and endless quagmires.

Blood Sport

by Thomas Frank

Harper’s Magazine Easy Chair (March 2013)

For a time in December, it looked as though the nation was finally ready to take on the gun culture. Perhaps you recall the moment: twenty grade-schoolers, along with their teachers and their principal, had been added to the roster of 30,000 people killed by guns in America each year. The details of the massacre were at once terrible and familiar – indeed, you could have guessed them as soon as you heard the first sketchy news bulletins. A murderer lost in some sanguinary fantasy. High-capacity magazines. In the starring role, one of our society’s prized slaughtering machines: an AR-15 assault rifle. And for the families of the six- and seven-year-olds whose bodies were blown apart, there would be teddy bears, support groups, wooden messages from the secretary of education.

On December 21, a week after the shooting, began the second obligatory chapter in this oft-told tale. Wayne LaPierre, the lavishly compensated face of the National Rifle Association, stepped up to a podium at the Willard Hotel in Washington and twisted his features into an expression meant to indicate sorrow. What came gurgling from LaPierre’s throat, though, was righteous accusation mixed with a heavy dollop of class resentment. It was the assembled men and women of the press who were somehow to blame, droned this million-dollar-a-year man who had apparently not bothered to read his script in advance. Gun owners were victims, you see, who had been demonized by the media and the “political class here in Washington”. Oh, pity the man with a MAC-10!

Next came the other parts of the traditional catechism. America’s leaders were soft on crime, unwilling “to prosecute dangerous criminals”. They gave too much money away in foreign aid. They miscategorized certain weapons as Thing A when they were obviously Thing B. Each of these grievances you could have heard, almost word for word, back in the 1970s. They are specimens of a chronic paranoia that never dissipates, no matter how many millions we imprison or how respectfully journalists learn to speak of the M16 and the sexy SIG Sauer.

But this time around, these bullet points were missing something. Matters had gone too far, and the NRA was desperate to escape the blame. But how? Well, if you are a prominent conservative lobbyist and one day there’s a catastrophe that stems pretty directly from your cherished policy initiatives, what do you do? You insist that the world hasn’t gone far enough in implementing your demands. So the solution to the massacre culture must obviously be more guns in more places than ever before: universities, churches, strip clubs, hospitals, tanning salons, bowling alleys.

And should something go wrong in this weapon-saturated world – for example, should someone use one of those weapons in precisely the way it was designed to be used – we may seek answers only within the narrow parameters of the ideologically permissible. Which is to say: We must meet every fresh mass murder with the conclusion that the United States, already home to some 300 million firearms, isn’t weapon-saturated enough. The task before us is to arm not only the guards in our elementary schools but also the teachers, the custodians, the cafeteria workers, the hall monitors. And on and on until the arms race is the preeminent logic of civilian life. Only then will the streets of Dodge City be safe.

I worry that I have not made sufficiently clear where I stand on this issue. For the record: gun control works. It seems obvious to me that, when considering the towering difference in murder statistics between the United States and other industrialized lands, the most relevant factor is the ready availability of certain kinds of firearms. I believe that the ideology of libertarianism, with its twin gods Market and Magnum, is not just bankrupting us; it is killing us. And I believe that Wayne LaPierre bears a certain moral responsibility for the massacre culture, regardless of his intentions or his exalted stature in Washington.

The reason I want to be clear about this is that I also think Wayne LaPierre got something right. In his Willard Hotel address, he tried to get the assembled media types to acknowledge their own culpability for our pandemic violence. “Media conglomerates”, he intoned, “compete with one another to shock, violate, and offend every standard of civilized society by bringing an ever more toxic mix of reckless behavior and criminal cruelty into our homes – every minute of every day of every month of every year”.

Coming from the NRA, of course, this was pretty base hypocrisy. It doesn’t take much skill with a remote to confirm that some of the most sadistic entertainment ever filmed follows the line of none other than the National Rifle Association. Over and over, we are shown spineless liberals with a soft spot for the murderers and rapists in our midst, who leave society’s dirty work to the big man with the big gun. Indeed, Wayne LaPierre basically gave the genre a shout-out when he reasoned, all too cinematically, that “the only thing that stops a bad guy with a gun is a good guy with a gun”.

But as a description of the world we live in, what LaPierre said was … well, correct. Media companies obviously do compete to project violence into our homes. And why is that? Because the American film industry is the second great pillar of the gun culture.

And it’s not just Clint Eastwood’s Smith & Wesson from Dirty Harry (1971), which, as everyone who lived through the 1970s knows, was then “the most powerful handgun in the world”, able to “blow your head clean off”. Hollywood’s cameras adore weapons of any kind, and pay them loving heed in movies of every political persuasion. Think of the close-up on Rambo’s machine gun as it spasms its way through an ammo belt in the 1985 installment of the series, or the shell casings tinkling delicately on the floor as cops die by the dozens in The Matrix (1999), or the heroic slo-mo of Sean Penn’s tommy gun in Gangster Squad (2013), or the really special Soviet submachine gun that everyone lusts after in Jack Abramoff’s 1989 action movie Red Scorpion. It’s the mother of all product placements, and as far as we know it doesn’t cost the arms makers a dime.

Even more delectable is the effect that guns have on human flesh, a phenomenon so titillating for moviemakers that it often surpasses the pleasures of plot and dialogue. Discussing the many, many graphic shootings in his recent Django Unchained (2012), for example, director Quentin Tarantino identifies screen violence as the reason most viewers go to his movies in the first place. “That’s fun, and that’s cool, and that’s really enjoyable”, he told NPR. “And kind of what you’re waiting for”.

In Tarantino’s pseudohistorical revenge fantasies, humans are oversize water balloons just waiting to be popped, so that they can spurt their exciting red contents over walls and bystanders. The role of the star is relatively simple: he or she must make those human pinatas give up their payload. Yes, there are plots along the way, clever ones wherein Tarantino burnishes his controversial image by daring to take on such sacred cows as Nazis and slave owners. But the nonstars in his movies mainly exist to beg for their lives and then be orgasmically deprived of them, spouting blood like so many harpooned porpoises.

Okay, I got carried away there. Let me catch my breath and admit it: Tarantino would never show someone harpooning a porpoise. After all, a line in the credits for Django Unchained declares that “no horses were harmed in the making of this movie”. But harpooning a human? After having first blasted off the human’s balls and played a sunny pop song from the Seventies while the human begged for mercy in the background? No problem.

The movies I describe here are essentially advertisements for mass murder. You can also read them in dozens of other ways, I know. You can talk about Tarantino’s clever and encyclopedically allusive command of genre, or about how the latest Batman movie advances the “franchise”, or about the inky shady shadowiness of, well, nearly everything the industry cranks out nowadays. And to give them their due, most of the movies I’ve mentioned take pains to clarify that what they depict are good-guy-on-bad-guy murders – which makes homicide okay, maybe even wholesome.

In decades past, let’s recall, there was a fashion for viewing the gangster film as a delicate metaphor, interesting mainly for the dark existentialism it spotlighted in our souls. But today, as I absorb the blunt aesthetic blows of one ultraviolent film after another, all I can make of it is that Hollywood, for reasons of its own, is hopelessly enamored of homicide. The plot is barely there anymore. Good guys and bad guys are hopelessly jumbled, their motives as vague as those of the Sandy Hook shooter, Adam Lanza. A movie like The Dark Knight Rises (2012) is nearly impossible to make sense of; only its many murders hold it together. All the rest shrinks, but the act of homicide expands, ramifies, multiplies madly.

And what can we read in this act itself? Well, most obviously, that ordinary humans are weak and worth little, that they achieve beauty only when they are brought to efflorescence by the discharge of a star’s sidearm. Also: killers are glamorous creatures. And lastly: society and law are futile exercises. Whether we’re dealing with vigilantes, hit men, or a World War Two torture squad, nobody can shield us from the power of an armed man. (Except, of course, another armed man, as Wayne LaPierre and Hollywood never tire of informing us.)

For the industry itself, meanwhile, so many things come together in the act of murder – audience pleasure, actor coolness, the appearance of art – that everything else is essentially secondary. Hence the basic principles of Hollywood’s antisocial faith. A man isn’t really a man if he can’t use a shotgun to change the seat of another man’s soul into so much garbage. Or if he doesn’t know how to fire a pistol sideways, signifying that thuggish disregard for who or what gets caught in the spray of bullets.

At times, my erudite liberal colleagues have no problem understanding this. They’re quick to characterize Zero Dark Thirty (2012) as an advertisement for torture and other Bush-era outrages {*}. It’s sadism!, they cry. But the larger sadism that is obviously the film industry’s truest muse … that they don’t want to discuss. Bring that up and the conversation is immediately suspended in favor of legal arguments about censorship, free speech, and the definition of “incitement”. Movies can’t be said to have caused mass murders, they correctly point out. Not even Natural Born Killers (1994) – a movie that insists on the complicity of the media in romanticizing murderers, that itself proceeds to romanticize murderers, and that has been duly shadowed by a long string of alleged copycat murders, including the Columbine massacre. No, these are works of art. And art is, you know, all edgy and defiant and shit.

{*} Yet few of them complained about Tarantino’s 2009 slice of war porn, Inglourious Basterds, since the people being tortured so graphically and so hilariously by a US Army hit squad were Nazis.

Not surprisingly, Quentin Tarantino has lately become the focus for this sort of criticism. The fact that Django Unchained arrived in theaters right around the time of the Sandy Hook massacre didn’t help. Yet he has refused to give an inch in discussing the link between movie violence and real life. “Obviously I don’t think one has to do with the other”, he told an NPR interviewer. “Movies are about make-believe. It’s about imagination. Part of the thing is we’re trying to create a realistic experience, but we are faking it.”

Is it possible that anyone in our cynical world credits a self-serving sophistry like this? Of course an industry under fire will claim that its hands are clean, just as the NRA has done – and of course a favorite son, be it Tarantino or LaPierre, can be counted on to make the claim louder than anyone else. But do they really believe that imaginative expression is without consequence? One might as well claim that advertising itself has no effect – because the spokesmen aren’t really enjoying that Sprite, you know, only pretending to. Or that TV speeches don’t matter, since the politician’s words are strung together for dramatic effect, and are not themselves a show of official force.

To insist on a full, pristine separation of the dramatic imagination from the way humans actually behave is to fly in the face of nearly everything we know about cultural history. For centuries, people misinterpreted the reign of Richard III because of a play by Shakespeare. The revival of the Ku Klux Klan in the 1920s was advanced by D W Griffith’s Birth of a Nation (1915). In our own era, millions of Americans believe in the righteous innocence of businessmen because of a novel by Ayn Rand.

And here is why I personally will never believe it when the film industry claims its products have no effect on human behavior. Like every American, I carry around in my head a collection of sights and sounds that I will never be able to erase, no matter what I think about Hollywood. To this day, those bits of dialogue and those filmed images affect the way I do everything from answering the phone to pruning my roses. I can’t get on my Honda scooter without recalling Steve McQueen in The Great Escape (1963), or look out an airplane window without remembering The Best Years of Our Lives (1946). When I shot at paper targets in the Boy Scouts, I thought of Sergeant York (1941), and should I ever become an Los Angeles cop I will probably mimic the mannerisms of Ryan Gosling in Gangster Squad (2013).

I doubt very much that we will see effective gun control enacted this time around. Oh, the rules have already been tightened in New York, and the president will gamely joust with the House of Representatives over renewing the ban on assault weapons. But it won’t go much further. The political arm of the gun culture, headquartered at the big NRA building in northern Virginia, is still powerful enough to block any meaningful change.

However, the other pillar of the gun culture – the propaganda bureau relaxing in the Los Angeles sun – is much more vulnerable. Its continued well-being depends to a real degree on the approbation and collaboration of critics.

Which is to say that my colleagues in journalism are, in part, responsible for this monster. We have fostered it with puff pieces and softball interviews and a thousand “press junkets” – the free vacations for journalists that secure avalanches of praise for a movie before anyone has seen it. This refusal on the part of critics to criticize is what has allowed Quentin Tarantino to be crowned a cinematic genius of our time. (When a journalist refuses to grovel, however, Tarantino gets awfully peevish. “This is a commercial for the movie, make no mistake”, he recently told an interviewer bold enough to ask him an uncomfortable question.)

It is time for the bootlicking to end. Mick LaSalle, film critic for the San Francisco Chronicle, recently recalled how he self-censored a review of The Dark Knight Rises (2012), declining to say in print that he found it to be “a wallow in nonstop cruelty and destruction”. But in the wake of the Connecticut school massacre, LaSalle explained, he had come around to a new understanding of critical responsibility. “If movies are cruel and nihilistic, say so”, he wrote. “Say it explicitly. Don’t run from that observation.”

It’s a lesson that every one of us in journalism ought to be taking to heart these days. It is our job to say it explicitly – to tell the world what god-awful heaps of cliche and fake profundity and commercialized sadism this industry produces. The fake blood spilled by Hollywood cries out for it.

Nestle CEO: Water Is Not A Human Right

Should Be Privatized

by Anthony Gucciardi

Natural Society (April 23 2013)

Is water a free and basic human right, or should all the water on the planet belong to major corporations and be treated as a product? Should the poor who cannot afford to pay these said corporations suffer from starvation due to their lack of financial wealth? According to the former CEO and now Chairman of the largest food product manufacturer in the world, corporations should own every drop of water on the planet – and you’re not getting any unless you pay up.

The company notorious for sending out hordes of ‘internet warriors’ to defend the company {1} and its actions online in comments and message boards (perhaps we’ll find some below) even takes a firm stance behind Monsanto’s GMOs and their ‘proven safety’. In fact, the former Nestle CEO actually says that his idea of water privatization is very similar to Monsanto’s GMOs. In a video interview, Nestle Chairman Peter Brabeck-Letmathe states that there has never been ‘one illness’ ever caused from the consumption of GMOs.

Watch the video below for yourself:

The way in which this sociopath clearly has zero regard for the human race outside of his own wealth and the development of Nestle, who has been caught funding attacks against GMO labeling {2}, can be witnessed when watching and listening to his talk on the issue. This is a company that actually goes into struggling rural areas and extracts the groundwater for their bottled water products, completely destroying the water supply of the area without any compensation. In fact, they actually make rural areas in the United States foot the bill {3}.

As reported on by Corporate Watch, Nestle and former CEO Peter Brabeck-Letmathe have a long history of disregarding public health and abusing the environment to take part in the profit of an astounding $35 billion in annual profit from water bottle sales alone. The report states {4}:


Nestle production of mineral water involves the abuse of vulnerable water resources. In the Serra da Mantiqueira region of Brazil, home to the “circuit of waters” park whose groundwater has a high mineral content and medicinal properties, over-pumping has resulted in depletion and long-term damage.


Nestle has also come under fire over the assertion that they are actually conducting business with massive slavery rings. Another Corporate Watch entry details:


In 2001, Nestle faced criticism for buying cocoa from the Ivory Coast and Ghana, which may have been produced using child slaves [58]. According to an investigative report by the BBC, hundreds of thousands of children in Mali, Burkina Faso and Togo were being purchased from their destitute parents and shipped to the Ivory Coast, to be sold as slaves to cocoa farms.


So is water a human right, or should it be owned by big corporations? Well, if water is not here for all of us, then perhaps air should be owned by major corporations as well. And as for crops, Monsanto is already working hard to make sure their monopoly on our staple crops and beyond is well situated. It should really come as no surprise that this Nestle Chairman fights to keep Monsanto’s GMOs alive and well in the food supply {5}, as his ideology lines right up with that of Monsanto.







Anthony Gucciardi is an accomplished investigative journalist whose articles have appeared on top news sites and have been read by millions worldwide. Anthony’s articles are routinely featured on top health & political websites such as Drudge Report, NaturalNews, and Infowars. Anthony is also a founding member of Natural Attitude, a leading developer of super high quality spagyric formulations.

Everything Is Rigged

The Biggest Price-Fixing Scandal Ever

The Illuminati were amateurs. The second huge financial scandal of the year reveals the real international conspiracy: There’s no price the big banks can’t fix.

by Matt Taibbi

Rolling Stone (April 25 2013)

Conspiracy theorists of the world, believers in the hidden hands of the Rothschilds and the Masons and the Illuminati, we skeptics owe you an apology. You were right. The players may be a little different, but your basic premise is correct: The world is a rigged game. We found this out in recent months, when a series of related corruption stories spilled out of the financial sector, suggesting the world’s largest banks may be fixing the prices of, well, just about everything.

You may have heard of the Libor scandal, in which at least three – and perhaps as many as sixteen – of the name-brand too-big-to-fail banks have been manipulating global interest rates, in the process messing around with the prices of upward of $500 trillion (that’s trillion, with a “t”) worth of financial instruments. When that sprawling con burst into public view last year, it was easily the biggest financial scandal in history – MIT professor Andrew Lo even said it “dwarfs by orders of magnitude any financial scam in the history of markets”.

That was bad enough, but now Libor may have a twin brother. Word has leaked out that the London-based firm ICAP, the world’s largest broker of interest-rate swaps, is being investigated by American authorities for behavior that sounds eerily reminiscent of the Libor mess. Regulators are looking into whether or not a small group of brokers at ICAP may have worked with up to fifteen of the world’s largest banks to manipulate ISDAfix, a benchmark number used around the world to calculate the prices of interest-rate swaps.

Interest-rate swaps are a tool used by big cities, major corporations and sovereign governments to manage their debt, and the scale of their use is almost unimaginably massive. It’s about a $379 trillion market, meaning that any manipulation would affect a pile of assets about 100 times the size of the United States federal budget.

It should surprise no one that among the players implicated in this scheme to fix the prices of interest-rate swaps are the same megabanks – including Barclays, UBS, Bank of America, JPMorgan Chase and the Royal Bank of Scotland – that serve on the Libor panel that sets global interest rates. In fact, in recent years many of these banks have already paid multimillion-dollar settlements for anti-competitive manipulation of one form or another (in addition to Libor, some were caught up in an anti-competitive scheme, detailed in Rolling Stone last year, to rig municipal-debt service auctions).  Though the jumble of financial acronyms sounds like gibberish to the layperson, the fact that there may now be price-fixing scandals involving both Libor and ISDAfix suggests a single, giant mushrooming conspiracy of collusion and price-fixing hovering under the ostensibly competitive veneer of Wall Street culture.

The Scam Wall Street Learned From the Mafia

Why? Because Libor already affects the prices of interest-rate swaps, making this a manipulation-on-manipulation situation. If the allegations prove to be right, that will mean that swap customers have been paying for two different layers of price-fixing corruption. If you can imagine paying twenty bucks for a crappy peanut butter and jelly sandwich because some evil cabal of agribusiness companies colluded to fix the prices of both peanuts and peanut butter, you come close to grasping the lunacy of financial markets where both interest rates and interest-rate swaps are being manipulated at the same time, often by the same banks.

“It’s a double conspiracy”, says an amazed Michael Greenberger, a former director of the trading and markets division at the Commodity Futures Trading Commission and now a professor at the University of Maryland. “It’s the height of criminality”.

The bad news didn’t stop with swaps and interest rates. In March, it also came out that two regulators – the CFTC here in the US and the Madrid-based International Organization of Securities Commissions – were spurred by the Libor revelations to investigate the possibility of collusive manipulation of gold and silver prices. “Given the clubby manipulation efforts we saw in Libor benchmarks, I assume other benchmarks – many other benchmarks – are legitimate areas of inquiry”, CFTC Commissioner Bart Chilton said.

But the biggest shock came out of a federal courtroom at the end of March – though if you follow these matters closely, it may not have been so shocking at all – when a landmark class-action civil lawsuit against the banks for Libor-related offenses was dismissed. In that case, a federal judge accepted the banker-defendants’ incredible argument: If cities and towns and other investors lost money because of Libor manipulation, that was their own fault for ever thinking the banks were competing in the first place.

“A farce”, was one antitrust lawyer’s response to the eyebrow-raising dismissal.

“Incredible”, says Sylvia Sokol, an attorney for Constantine Cannon, a firm that specializes in antitrust cases.

All of these stories collectively pointed to the same thing: These banks, which already possess enormous power just by virtue of their financial holdings – in the United States, the top six banks, many of them the same names you see on the Libor and ISDAfix panels, own assets equivalent to sixty percent of the nation’s GDP – are beginning to realize the awesome possibilities for increased profit and political might that would come with colluding instead of competing. Moreover, it’s increasingly clear that both the criminal justice system and the civil courts may be impotent to stop them, even when they do get caught working together to game the system.

If true, that would leave us living in an era of undisguised, real-world conspiracy, in which the prices of currencies, commodities like gold and silver, even interest rates and the value of money itself, can be and may already have been dictated from above. And those who are doing it can get away with it. Forget the Illuminati – this is the real thing, and it’s no secret. You can stare right at it, anytime you want.

The banks found a loophole, a basic flaw in the machine. Across the financial system, there are places where prices or official indices are set based upon unverified data sent in by private banks and financial companies. In other words, we gave the players with incentives to game the system institutional roles in the economic infrastructure.

Libor, which measures the prices banks charge one another to borrow money, is a perfect example, not only of this basic flaw in the price-setting system but of the weakness in the regulatory framework supposedly policing it. Couple a voluntary reporting scheme with too-big-to-fail status and a revolving-door legal system, and what you get is unstoppable corruption.

Every morning, eighteen of the world’s biggest banks submit data to an office in London about how much they believe they would have to pay to borrow from other banks. The eighteen banks together are called the “Libor panel”, and when all of these data from all eighteen panelist banks are collected, the numbers are averaged out. What emerges, every morning at 11:30 London time, are the daily Libor figures.

Banks submit numbers about borrowing in ten different currencies across fifteen different time periods, for example, loans as short as one day and as long as one year. This mountain of bank-submitted data is used every day to create benchmark rates that affect the prices of everything from credit cards to mortgages to currencies to commercial loans (both short- and long-term) to swaps.

Gangster Bankers Broke Every Law in the Book

Dating back perhaps as far as the early Nineties, traders and others inside these banks were sometimes calling up the company geeks responsible for submitting the daily Libor numbers (the “Libor submitters”) and asking them to fudge the numbers. Usually, the gimmick was the trader had made a bet on something – a swap, currencies, something – and he wanted the Libor submitter to make the numbers look lower (or, occasionally, higher) to help his bet pay off.

Famously, one Barclays trader monkeyed with Libor submissions in exchange for a bottle of Bollinger champagne, but in some cases, it was even lamer than that. This is from an exchange between a trader and a Libor submitter at the Royal Bank of Scotland:

SWISS FRANC TRADER: can u put 6m swiss libor in low pls?…
SWSISS FRANC TRADER: ive got some sushi rolls from yesterday?…
PRIMARY SUBMITTER: ok low 6m, just for u
SWISS FRANC TRADER: wooooooohooooooo. . . thatd be awesome

Screwing around with world interest rates that affect billions of people in exchange for day-old sushi – it’s hard to imagine an image that better captures the moral insanity of the modern financial-services sector.

Hundreds of similar exchanges were uncovered when regulators like Britain’s Financial Services Authority and the US Justice Department started burrowing into the befouled entrails of Libor. The documentary evidence of anti-competitive manipulation they found was so overwhelming that, to read it, one almost becomes embarrassed for the banks. “It’s just amazing how Libor fixing can make you that much money”, chirped one yen trader. “Pure manipulation going on”, wrote another.

Yet despite so many instances of at least attempted manipulation, the banks mostly skated. Barclays got off with a relatively minor fine in the $450 million range, UBS was stuck with $1.5 billion in penalties, and RBS was forced to give up $615 million. Apart from a few low-level flunkies overseas, no individual involved in this scam that impacted nearly everyone in the industrialized world was even threatened with criminal prosecution.

Two of America’s top law-enforcement officials, Attorney General Eric Holder and former Justice Department Criminal Division chief Lanny Breuer, confessed that it’s dangerous to prosecute offending banks because they are simply too big. Making arrests, they say, might lead to “collateral consequences” in the economy.

The relatively small sums of money extracted in these settlements did not go toward reparations for the cities, towns and other victims who lost money due to Libor manipulation. Instead, it flowed mindlessly into government coffers. So it was left to towns and cities like Baltimore (which lost money due to fluctuations in their municipal investments caused by Libor movements), pensions like the New Britain Connecticut Firefighters’ and Police Benefit Fund, and other foundations – and even individuals (billionaire real-estate developer Sheldon Solow, who filed his own suit in February, claims that his company lost $450 million because of Libor manipulation) – to sue the banks for damages.

One of the biggest Libor suits was proceeding on schedule when, early in March, an army of superstar lawyers working on behalf of the banks descended upon federal judge Naomi Buchwald in the Southern District of New York to argue an extraordinary motion to dismiss. The banks’ legal dream team drew from heavyweight Beltway-connected firms like Boies Schiller (you remember David Boies represented Al Gore), Davis Polk (home of top ex-regulators like former SEC enforcement chief Linda Thomsen) and Covington & Burling, the onetime private-practice home of both Holder and Breuer.

The presence of Covington & Burling in the suit – representing, of all companies, Citigroup, the former employer of current Treasury Secretary Jack Lew – was particularly galling. Right as the Libor case was being dismissed, the firm had hired none other than Lanny Breuer, the same Lanny Breuer who, just a few months before, was the assistant attorney general who had balked at criminally prosecuting UBS over Libor because, he said, “Our goal here is not to destroy a major financial institution”.

In any case, this all-star squad of white-shoe lawyers came before Buchwald and made the mother of all audacious arguments. Robert Wise of Davis Polk, representing Bank of America, told Buchwald that the banks could not possibly be guilty of anti- competitive collusion because nobody ever said that the creation of Libor was competitive. “It is essential to our argument that this is not a competitive process”, he said. “The banks do not compete with one another in the submission of Libor”.

If you squint incredibly hard and look at the issue through a mirror, maybe while standing on your head, you can sort of see what Wise is saying. In a very theoretical, technical sense, the actual process by which banks submit Libor data – eighteen geeks sending numbers to the British Bankers’ Association offices in London once every morning – is not competitive per se.

But these numbers are supposed to reflect interbank-loan prices derived in a real, competitive market. Saying the Libor submission process is not competitive is sort of like pointing out that bank robbers obeyed the speed limit on the way to the heist. It’s the silliest kind of legal sophistry.

But Wise eventually outdid even that argument, essentially saying that while the banks may have lied to or cheated their customers, they weren’t guilty of the particular crime of antitrust collusion. This is like the old joke about the lawyer who gets up in court and claims his client had to be innocent, because his client was committing a crime in a different state at the time of the offense.

“The plaintiffs, I believe, are confusing a claim of being perhaps deceived”, he said, “with a claim for harm to competition”.

Judge Buchwald swallowed this lunatic argument whole and dismissed most of the case. Libor, she said, was a “cooperative endeavor” that was “never intended to be competitive”. Her decision “does not reflect the reality of this business, where all of these banks were acting as competitors throughout the process”, said the antitrust lawyer Sokol. Buchwald made this ruling despite the fact that both the US and British governments had already settled with three banks for billions of dollars for improper manipulation, manipulation that these companies admitted to in their settlements.

Michael Hausfeld of Hausfeld LLP, one of the lead lawyers for the plaintiffs in this Libor suit, declined to comment specifically on the dismissal. But he did talk about the significance of the Libor case and other manipulation cases now in the pipeline.

“It’s now evident that there is a ubiquitous culture among the banks to collude and cheat their customers as many times as they can in as many forms as they can conceive”, he said. “And that’s not just surmising. This is just based upon what they’ve been caught at.”

Greenberger says the lack of serious consequences for the Libor scandal has only made other kinds of manipulation more inevitable. “There’s no therapy like sending those who are used to wearing Gucci shoes to jail”, he says. “But when the attorney general says, ‘I don’t want to indict people’, it’s the Wild West. There’s no law.”

The problem is, a number of markets feature the same infrastructural weakness that failed in the Libor mess. In the case of interest-rate swaps and the ISDAfix benchmark, the system is very similar to Libor, although the investigation into these markets reportedly focuses on some different types of improprieties.

Though interest-rate swaps are not widely understood outside the finance world, the root concept actually isn’t that hard. If you can imagine taking out a variable-rate mortgage and then paying a bank to make your loan payments fixed, you’ve got the basic idea of an interest-rate swap.

In practice, it might be a country like Greece or a regional government like Jefferson County, Alabama, that borrows money at a variable rate of interest, then later goes to a bank to “swap” that loan to a more predictable fixed rate. In its simplest form, the customer in a swap deal is usually paying a premium for the safety and security of fixed interest rates, while the firm selling the swap is usually betting that it knows more about future movements in interest rates than its customers.

Prices for interest-rate swaps are often based on ISDAfix, which, like Libor, is yet another of these privately calculated benchmarks. ISDAfix’s US dollar rates are published every day, at 11:30 am and 3:30 pm, after a gang of the same usual-suspect megabanks (Bank of America, RBS, Deutsche, JPMorgan Chase, Barclays, et al) submits information about bids and offers for swaps.

And here’s what we know so far: The CFTC has sent subpoenas to ICAP and to as many as fifteen of those member banks, and plans to interview about a dozen ICAP employees from the company’s office in Jersey City, New Jersey. Moreover, the International Swaps and Derivatives Association, or ISDA, which works together with ICAP (for US dollar transactions) and Thomson Reuters to compute the ISDAfix benchmark, has hired the consulting firm Oliver Wyman to review the process by which ISDAfix is calculated. Oliver Wyman is the same company that the British Bankers’ Association hired to review the Libor submission process after that scandal broke last year. The upshot of all of this is that it looks very much like ISDAfix could be Libor all over again.

“It’s obviously reminiscent of the Libor manipulation issue”, Darrell Duffie, a finance professor at Stanford University, told reporters. “People may have been naive that simply reporting these rates was enough to avoid manipulation”.

And just like in Libor, the potential losers in an interest-rate-swap manipulation scandal would be the same sad-sack collection of cities, towns, companies and other nonbank entities that have no way of knowing if they’re paying the real price for swaps or a price being manipulated by bank insiders for profit. Moreover, ISDAfix is not only used to calculate prices for interest-rate swaps, it’s also used to set values for about $550 billion worth of bonds tied to commercial real estate, and also affects the payouts on some state-pension annuities.

So although it’s not quite as widespread as Libor, ISDAfix is sufficiently power-jammed into the world financial infrastructure that any manipulation of the rate would be catastrophic – and a huge class of victims that could include everyone from state pensioners to big cities to wealthy investors in structured notes would have no idea they were being robbed.

“How is some municipality in Cleveland or wherever going to know if it’s getting ripped off?” asks Michael Masters of Masters Capital Management, a fund manager who has long been an advocate of greater transparency in the derivatives world. “The answer is, they won’t know”.

Worse still, the CFTC investigation apparently isn’t limited to possible manipulation of swap prices by monkeying around with ISDAfix. According to reports, the commission is also looking at whether or not employees at ICAP may have intentionally delayed publication of swap prices, which in theory could give someone (bankers, cough, cough) a chance to trade ahead of the information.

Swap prices are published when ICAP employees manually enter the data on a computer screen called “19901”. Some 6,000 customers subscribe to a service that allows them to access the data appearing on the 19901 screen.

The key here is that unlike a more transparent, regulated market like the New York Stock Exchange, where the results of stock trades are computed more or less instantly and everyone in theory can immediately see the impact of trading on the prices of stocks, in the swap market the whole world is dependent upon a handful of brokers quickly and honestly entering data about trades by hand into a computer terminal.

Any delay in entering price data would provide the banks involved in the transactions with a rare opportunity to trade ahead of the information. One way to imagine it would be to picture a racetrack where a giant curtain is pulled over the track as the horses come down the stretch – and the gallery is only told two minutes later which horse actually won. Anyone on the right side of the curtain could make a lot of smart bets before the audience saw the results of the race.

At ICAP, the interest-rate swap desk, and the 19901 screen, were reportedly controlled by a small group of twenty or so brokers, some of whom were making millions of dollars. These brokers made so much money for themselves the unit was nicknamed “Treasure Island”.

Already, there are some reports that brokers of Treasure Island did create such intentional delays. Bloomberg interviewed a former broker who claims that he watched ICAP brokers delay the reporting of swap prices. “That allows dealers to tell the brokers to delay putting trades into the system instead of in real time”, Bloomberg wrote, noting the former broker had “witnessed such activity firsthand”. An ICAP spokesman has no comment on the story, though the company has released a statement saying that it is “cooperating” with the CFTC’s inquiry and that it “maintains policies that prohibit” the improper behavior alleged in news reports.

The idea that prices in a $379 trillion market could be dependent on a desk of about twenty guys in New Jersey should tell you a lot about the absurdity of our financial infrastructure. The whole thing, in fact, has a darkly comic element to it. “It’s almost hilarious in the irony”, says David Frenk, director of research for Better Markets, a financial-reform advocacy group, “that they called it ISDAfix”.

After scandals involving libor and, perhaps, ISDAfix, the question that should have everyone freaked out is this: What other markets out there carry the same potential for manipulation? The answer to that question is far from reassuring, because the potential is almost everywhere. From gold to gas to swaps to interest rates, prices all over the world are dependent upon little private cabals of cigar-chomping insiders we’re forced to trust.

“In all the over-the-counter markets, you don’t really have pricing except by a bunch of guys getting together”, Masters notes glumly.

That includes the markets for gold (where prices are set by five banks in a Libor-ish teleconferencing process that, ironically, was created in part by N M Rothschild & Sons) and silver (whose price is set by just three banks), as well as benchmark rates in numerous other commodities – jet fuel, diesel, electric power, coal, you name it. The problem in each of these markets is the same: We all have to rely upon the honesty of companies like Barclays (already caught and fined $453 million for rigging Libor) or JPMorgan Chase (paid a $228 million settlement for rigging municipal-bond auctions) or UBS (fined a collective $1.66 billion for both municipal-bond rigging and Libor manipulation) to faithfully report the real prices of things like interest rates, swaps, currencies and commodities.

All of these benchmarks based on voluntary reporting are now being looked at by regulators around the world, and God knows what they’ll find. The European Federation of Financial Services Users wrote in an official EU survey last summer that all of these systems are ripe targets for manipulation. “In general”, it wrote, “those markets which are based on non-attested, voluntary submission of data from agents whose benefits depend on such benchmarks are especially vulnerable of market abuse and distortion”.

Translation: When prices are set by companies that can profit by manipulating them, we’re fucked.

“You name it”, says Frenk. “Any of these benchmarks is a possibility for corruption”.

The only reason this problem has not received the attention it deserves is because the scale of it is so enormous that ordinary people simply cannot see it. It’s not just stealing by reaching a hand into your pocket and taking out money, but stealing in which banks can hit a few keystrokes and magically make whatever’s in your pocket worth less. This is corruption at the molecular level of the economy, Space Age stealing – and it’s only just coming into view.

This story is from the May 9th 2013 issue of Rolling Stone.

To read the new issue of Rolling Stone online, plus the entire RS archive click

Robert Johnson on the Oligarchs

“They’re all standing on the deck of the Titanic looking in each other’s eyes”.

Submitted by transcriber (April 20 2013)

Jesse’s Cafe Americain post on Jeffrey Sachs included an additional YouTube, Robert Johnson on Oligarchy, at the 2012 Impact Festival in New York. Well matched:

Filmed July 25 2012
Posted by DeepDishTV


Robert Johnson: I think the, call it the oligarchy now is audacious. They don’t really care if they’re legitimate. There was a time – you know, I always hear Jurgen Habermas was paraphrased by saying, “Legitimate if you can, coerce if you have to, and accommodate if you must”. And I think we’ve gone past – I almost started, this was really eerie because we didn’t compare notes – I almost started my discussion about John Ralston Saul’s book, The Unconscious Civilization (1999), and I think we’ve gone beyond – I’m grateful we have gone beyond the unconscious civilization. A lot of people don’t buy the package anymore that’s emanating from those corporations you talked about.

But there is a sort of, “Okay guys, you’re mad, how are you going to stop me?” mentality at the top. Now I’m going to say that that fight has to happen, but there’s also, you know, they always talk about Marx and capitalism, capitalists versus labor. A lot of the interesting fissures in a system are intracapitalist conflict, and right now, I guess the way I’d put it in a metaphor is it feels like there are an awful lot of the elite that know this system is not wholesome, and they’re all standing on the deck of the Titanic looking in each other’s eyes, and they’re asking a question with their eyes,


Are we going to help this navigator? Are we going to help this captain get off the ice? Or are we going to get the food and the jewels from the safe and put them in our lifeboat?


And my sense is that most of them are trying to get stuff into their lifeboat, and that system isn’t going to cohere. And in that dysfunction there is opportunity.

The God With Three Heads

by John Michael Greer

The Archdruid Report (April 24 2013)

Druid perspectives on nature, culture, and the future of industrial society

It’s been said that a man’s religion is the thing he can’t bear to have questioned. If there’s any truth in that old saying, the idea that faith in progress is a religion has a great deal going for it. Over the seven years this blog has been appearing, I’ve discussed any number of controversial issues and made plenty of proposals that contradict the conventional wisdom of our times; none of them has fielded me as many spluttering denunciations as the suggestion that belief in progress is the most important civil religion of the modern industrial world.

A commenter on one of the many other sites where my posts appear thus started off his critique of last week’s post with a shout of “Why bear with this?” Since I doubt anybody’s holding a gun to his head and making him read The Archdruid Report, he’ll have to answer his question himself. Still, his furious outburst is a useful reminder of one of the distinctive features of the belief systems we’re discussing; however subtle and closely reasoned their intellectual sides happen to be, they reach right down into the deepest places of the human heart, and draw on powerful and unreasoning passions.

Civil religions and theist religions alike have motivated believers to die for their faith and to kill for it, to make tremendous sacrifices and commit appalling crimes.  Not many human motivations can equal religion as a driving force, and I don’t know of any that reliably surpass it. When people push past the limits of ordinary humanity in any direction, good or evil, if it’s not a matter of the love or hate of one human being for another, odds are that what drives them onward is either a theist faith or a civil one.

This is among the core reasons why I’ve launched into an exploration of the religious dimensions of peak oil, and why I’ve begun that with a study of the most distinctive feature of the religious landscape of our time: the way that belief in the invincibility and beneficence of progress has come to serve an essentially religious role in the modern world, permeating the collective conversations of our time.  It’s also a core reason why that exploration will continue over the weeks to come, because there’s much more that needs saying about the contemporary faith in progress, the historical mythology that underlies it, and the distortions it imposes on nearly all of our society’s assumptions about the future.

It’s important, to begin with, to pay attention to the ambiguities wrapped up in the modern conception of progress. When people think or talk about progress, by that name or any of its common euphemisms, there are at least three different things they can mean by it. All three share the common presupposition that history has an inherent tendency to move in a particular direction, that movement in that direction is a good thing, and that human beings can and should contribute to that forward movement toward the good; it’s the dimension of human life in which the movement is believed to be taking place that marks the distinction between these different meanings of progress.

The first version of progress is moral progress:  it centers on the claim that history’s inherent tendency is toward increasingly ethical human relationships and social forms. These days, especially on the leftward end of society, this version of progress is usually framed in political terms, but its moral thrust is impossible to miss, as its proponents inevitably frame their arguments in terms of moral absolutes, virtues and vices.   At its best, the ethical stance of the contemporary mainstream Left in America and Europe is one of the few really original moral philosophies to develop in modern times, with a distinctive focus on the virtues of equality, social justice, and kindness, all understood and pursued primarily on a collective rather than an individual level; at its worst – like all philosophies, it has its less impressive side – it becomes a self-righteous cant, by turns saccharine and shrill, in the service of the craving for unearned power that’s the besetting sin of all modern moralists.

You can see the faith in moral progress in action any time people insist that some proposed social change is an advance, a move forward, away from the ignorance and injustice of the benighted past. Even when this sort of talk is cheap manipulative rhetoric, as of course it so often is, it’s the faith in moral progress that gives the manipulation power and allows it to work.  Think about the implications of “forward” and “backward” as applied to social changes, and you can begin to see how deeply the mythology of progress pervades contemporary thought:  only if history has a natural direction of flow does it make any kind of sense to refer to one set of social policies as “progressive” and another as “backward”, say, or to describe the culture or laws of one of the flyover states despised by the coastal literati as “stuck in the 1950s”.  It’s the faith that history moves in the direction set out by a specific definition of moral progress that gives these very common metaphors their meaning.

That’s only one of the three things that faith in progress can choose as its focus, though.  The second is scientific and technical progress, which centers on the claim that history’s inherent tendency is toward increasingly complete human knowledge and domination of the cosmos.  In theory, it might be possible to conceive of scientific progress without a corresponding increase in technical power, or vice versa; in practice, at least in the minds of those who interpret progress along these lines, the two are rarely separated. As Francis Bacon argued in the first gray dawn of the scientific revolution, the value of knowledge concerning nature is the power that results from that knowledge; investment in the production of scientific knowledge is almost universally justified by talking about what the resulting knowledge will let humanity do to the world.

To see the core features of a religion in starkest terms, it’s often useful to look at its most extreme forms, and the faith in scientific and technical progress is no exception.  The example I have in mind here is the Singularitarian movement, which claims that sometime soon – Singularitarian prophet Ray Kurzweil has set the date as 2045 – the unstoppable onward march of progress, bootstrapped by the creation of artificial intelligences far more powerful than any human mind, will accelerate to infinity. All the dreams of science fiction, from starflight through immortality to virtual sex with Marilyn Monroe, will become realities, and humanity will achieve something like godhood – unless the hyperintelligent computers decide to exterminate us all instead, that is.

There are plenty of things worth discussing about the Singularitarian religion, but the one that’s relevant to the present theme is the wild misunderstanding it imposes on the nature of scientific knowledge.  A large portion of the discoveries of science, including many of its greatest achievements, can be summed up neatly by the words “you can’t do that”.  If an all-wise supercomputer could be created at all – and it’s far from certain that one could be – it’s entirely possible that it would sort through the sum total of human science and technology and say to us, “For beings of such modest mental capacities, you’ve done a good job of figuring out what can be done with the resources available to you. Here are some technical tricks you haven’t worked out yet, but starflight, immortality, sex with this Marilyn Monroe person?  Sorry, those aren’t possible; you’ll have to go on living without them”. What’s more, it’s entirely possible that it would be right.

Even outside the Singularitarian faith, though, you can count on either blank incomprehension or furious disagreement if you suggest that there might be things that scientific and technological progress can’t achieve. Those of my readers who have been in the peak oil scene for any length of time will have learned that the most common dismissal they’ll get, when they try to suggest to the rest of the world that betting the future on infinite resource extraction from a finite planet is not a bright idea, is some variation on “Oh, I’m sure they’ll come up with something”. The “they” in this overfamiliar sentence are of course scientists and engineers; the mere fact that “they” have been trying to come up with something in this particular case for well over a century, and success is still nowhere in sight, does nothing to dent the really rather touching faith that today’s popular culture places in their powers.

Scientific and technical progress, then, plays a massive role in the modern mythology of progress. It’s equalled if not exceeded by the third kind of progress, economic progress,  which centers on the claim that history’s inherent tendency is to ever greater levels of economic abundance, however that abundance may happen to be distributed.  The belief that ongoing exponential economic growth is normal and beneficent, and that anything else is abnormal and destructive, is perhaps the most widely accepted form of the mythology of progress in contemporary life, not least because most people like to imagine that they themselves will benefit from it.

Open the business section of any newspaper, turn the pages of any economics textbook, scan the minutes of any meeting of any business corporation in contemporary America or most of the modern world, and you’ll get to see a faith in economic progress as absolute and unthinking as any medieval peasant’s trust in the wonderworking bones of the local saint.  In the mythic world portrayed by the prophets and visionaries of that faith, economic growth is always good, and comes as a reward to those who obey the commandments of the economists. The fact – and of course it is a fact – that obeying the commandments of the economists has by and large brought more disaster than prosperity to the industrial world’s economies for decades somehow rarely enters into these reverential thoughts.

In recent years, to be sure, faith in economic progress – that is, growth – has come under fire from two sides. On the one hand, there’s the small but gradually expanding body of ecologists, economists, and other scholars who point out the absurdity of perpetual economic expansion on a finite planet, and document some of the ways that an obsession with growth for its own sake produces a bumper crop of problems. On the other, there’s the less coherent but far more widespread sense that economic progress doesn’t seem to be happening the way it’s supposed to, that standards of living for most people are declining rather than improving, and that economic policies that have been sold to the public as ways to fix a troubled economy are having exactly the opposite effect.  Even so, most of the critiques coming out of this latter awareness, and no small number of those belonging to the former class, assume that growth is normal, and fixate on how that supposedly normal state got derailed.

Moral progress, scientific and technological progress, and economic progress:  those are the three forms that progress takes in the minds of those who put their faith in it:  if you will, the three heads of the deity of the Church of Progress. It’s crucial to keep in mind, though, that these three visions of progress often intertwine in complex ways in the minds of believers.  To many mainstream American liberals in the late 20th century, for example, the limitless progress of science and technology would guarantee equally limitless economic growth, which would make it possible to abolish poverty, provide equal opportunity for all, and fulfill the hopes of moral progress without requiring any of those who already had access to privilege and economic abundance to give up any of these things.

So complete a fusion of the three modes of progress was once standard.  Read any of the vast supply of self-congratulatory literature on progress churned out by popular presses in 19th century Britain or America, for example, and you can count on finding all three twisted tightly round one another, with the supposed moral superiority of Anglo-Saxon civilization serving as the linchpin of arguments that claimed to explain the limitless progress of technology and also to justify the extremely uneven distribution of the benefits of economic growth.  The 20th century’s ghastly history made such moral claims a good deal harder to make with a straight face, and so versions of the faith in progress popular in recent decades often avoid the moral dimension and focus on the other two forms of progress.

Far more often than not these days, as a result, the mainstream American version of faith in progress fixates purely on the supposedly unstoppable feedback loop between scientific and technological progress, on the one hand, and economic growth on the other, while moral progress has been consigned to bit parts here and there.  It’s mostly on the left that faith in moral progress retains its former place in the blend – one of the many ways in which the leftward end of the American political landscape is significantly more conservative, in the strict sense of the word, than those who call themselves conservative these days – and even there, it’s increasingly a fading hope, popular among the older generation of activists and among those who have moved toward the fringes of society and mix their faith in progress with a good solid helping of its erstwhle antireligion, the faith in apocalypse: it’s from this unstable mix that we get claims that the morally better world will arrive once evil, and most of the planet’s population, are blown to smithereens.

It’s by way of this latter process, I think, that faith in moral progress tends to pop up in the literature of peak oil, and even more often in conversations in the peak oil scene.  I’ve long since lost track of the number of times that someone has suggested to me that if industrial civilization continues down the well-worn track of overshoot and decline, the silver lining to that very dark cloud is that the rigors of the decline will force all of us, or at least the survivors, to become better people – “better” being defined variously as more ecologically sensitive, more compassionate, or what have you, depending on the personal preferences of the speaker.

Now of course when civilizations overshoot their resource base and start skidding down the arc of decline toward history’s compost bin, a sudden turn toward moral virtue of any kind is not a common event.  The collapse of social order, the rise of barbarian warbands, and a good many of the other concomitants of decline and fall tend to push things hard in the other direction.  Still, the importance of faith in progress in the collective imagination of our time is such that some way has to be found to make the future look better than the present. If a future of technological advancement and economic growth is no longer an option, then the hope for moral betterment becomes the last frail reed to which believers in progress cling with all their might.

To many of my readers, this may seem like a good idea; many others may consider it inevitable. I’m far from convinced that it’s either one. For more than thirty years now, the conviction that progress will somehow bail the industrial world out from the consequences of its own bad decisions has been the single largest obstacle in the way of preventing more of those same bad decisions from being made. How many times have we all heard that economic growth was going to take care of resource depletion and environmental degradation, or that scientific and technical advances were going to take care of them, or that a great moral awakening – call it the rise of planetary consciousness, or any of the other popular buzzwords, if you wish – was going to take care of them.  As it turned out, of course, none of those things took care of them at all, and since so many people placed their faith on one or the other kind of progress, nothing else took care of them, either.

Nor, for that matter, is faith in progress hardwired into the human psyche. It’s a specific belief system with distinct and well-documented historical roots in the Western world, and most other people in most other places and times have had beliefs about the future that contradicted it in every particular.  There have been many cultures in which history was held to have an inherent tendency to move from better to worse, from a Golden Age in the past to an age of darkness and horror somewhere in the future, and individual and collective hope focused on the possibility of holding onto the beneficent legacies of the past as long as possible in the teeth of decline. Nor are these the only options; there have, for example, been many cultures that saw time as a circle, and many more for whom time had no direction at all.

It’s quite common for people raised in a given culture to see its view of things as normal and natural, and to scratch their heads in bewilderment when they find that people in other places and times saw things in very different ways. Modern industrial civilization, for all its self-described sophistication, is no more exempt from this custom than any other human society. To make sense of the future closing in on us, it’s going to be necessary to get past that easy but misleading habit of thought, to recognize that the contemporary faith in progress is a culturally specific product that emerged in a highly unusual and self-terminating set of historical circumstances, and to realize that while it was highly adaptive in those circumstances, it’s become lethally maladaptive now.

To understand these things, in turn, it’s going to be necessary to dig down to the foundations of modern industrial culture, and grapple with one of the core cognitive frameworks our society – like every other – uses to make sense of the inkblot patterns of the cosmos.  For want of a better label, we’ll call this framework the shape of time.  We’ll talk about that next week.


My longtime readers may be pleased to learn that New Society Publications is now offering a twenty percent discount on prepublication orders for Green Wizardry {1}, the book that came out of the series of posts on Seventies-era appropriate technology I posted here in 2011 and 2012. This project took a little longer than my previous New Society books, but I think you’ll find it was worth the wait.


John Michael Greer is the Grand Archdruid of the Ancient Order of Druids in America {2} and the author of more than twenty books on a wide range of subjects, including The Long Descent: A User’s Guide to the End of the Industrial Age (2008), The Ecotechnic Future: Exploring a Post-Peak World (2009), and The Wealth of Nature: Economics As If Survival Mattered (2011). He lives in Cumberland, Maryland, an old red brick mill town in the north central Appalachians, with his wife Sara.

If you enjoy reading this blog, you might want to check out Star’s Reach {3}, his blog/novel of the deindustrial future. Set four centuries after the decline and fall of our civilization, it uses the tools of narrative fiction to explore the future our choices today are shaping for our descendants tomorrow.

And please consider putting a tip in the Archdruid’s tip jar. Many thanks!





Ten Signs The Takedown Of Paper Gold …

… Has Unleashed An Unprecedented Global Run On Physical Gold And Silver

by Michael

The Economic Collapse (April 18 2013)

The crash of the price of paper gold on Monday has unleashed an unprecedented global frenzy to buy physical gold and silver.  All over the planet, people are recognizing that this is a unique opportunity to be able to acquire large amounts of gold and silver at a bargain price.  So precious metals dealers now find themselves being overwhelmed with orders in the United States, in Canada, in Europe and over in Asia.  Will this massive run on physical gold and silver soon lead to widespread shortages of those metals?  Instead of frightening people away from gold and silver, the takedown of paper gold seems to have had just the opposite effect.  People just can’t seem to get enough physical gold and silver right now.  Those that wish that they had gotten into gold when it was less than $1400 an ounce are able to do so now, and it is absolutely insane that silver is sitting at about $23 an ounce.  If the big banks continue to play games with the price of gold, we are going to see existing supplies of physical gold and silver dry up very quickly.  And once reports of physical shortages of gold and silver become widespread, it is going to absolutely rock the financial world.  But this is what happens when you manipulate free markets – it often has unintended consequences far beyond anything that you ever imagined.

The following are ten signs that the takedown of paper gold has unleashed an unprecedented global run on physical gold and silver …

#1 According to Zero Hedge, the US Mint set a new all-time record for the number of gold ounces sold on Wednesday …

According to today’s data from the US Mint, a record 63,500 ounces, or a whopping two tons, of gold were reported sold on April 17th alone, bringing the total sales for the month to a whopping 147,000 ounces or more than the previous two months combined with just half of the month gone.


#2 Precious metals dealers all over the United States are having a really hard time keeping up with demand right now.  According to Chris Martenson, many are warning customers to expect waiting times of five to six weeks at this point …


In the US, all of the dealers I talk to are reporting huge demand and brisk buying. Silver in any form is quite hard to come by unless you want to pay premiums of twenty percent plus per ounce above spot price. Delivery times are five to six weeks out now – that’s an unusual situation.  If this recent slam was designed to scare people away from gold, it did not have that desired outcome; in fact, just the opposite.


#3 Individual dealers all over the country are confirming that we are seeing a voracious appetite for precious metals at the moment.  For example, the following is what a spokesperson for JM Bullion had to say …


We still have certain things in stock, like ten ounce bars, while others, like Silver Eagles, are a bit of revolving inventory.

The shipments are going out as soon as inventory comes in.

Our main challenge right now is actually getting the silver into the boxes and shipped out – we have been experiencing astounding volume.


This appears to be a widespread phenomenon.  Just check out what other dealers are reporting …


“There has been a marked increase in demand since the plunge”, said Mark O’Byrne, executive director at Dublin-based investment and bullion specialist GoldCore, referring to the drop in gold prices seen Friday and Monday. Gold futures lost more than $200 an ounce, or over thirteen percent, on those two days. They were at $1,392 an ounce, moving higher ahead of the close on Thursday.

GoldCore has seen more buying than selling on Wednesday and Thursday, with buy orders “lumpier and from high net worth clients, and with most of the selling in small orders of less than fifty ounces, said O’Byrne.

On Wednesday, David Beahm, executive vice president at Blanchard & Company, said his precious-metals investment firm has seen “2008-like demand” for gold since Monday.


#4 Large international banks are also experiencing tremendous demand for physical gold and silver by customers right now.  The following is what Keith Barron told King World News about what he is hearing …


At the Bank of Nova Scotia in Toronto the gold window has been absolutely swamped. I have confirmed there were people lined up in droves recently for multiple-hours at a time to buy gold and silver bars and coins …

I then confirmed with UBS today in Zurich, Switzerland, that they are experiencing exactly the same thing. They told me people are waiting in long lines for bullion related bars and coins. The physical market is incredibly tight, and there is a huge buying opportunity right here.

The damage in gold will not be long-term because physical supply is already drying up. Asian countries have been aggressively buying gold. This really is an unprecedented opportunity for investors. This takedown in the metals has created incredible demand for both gold and silver, and anyone who wants to unload dollars or euros and put them into gold because they don’t trust the currency, now is the time to do it.


#5 The demand for physical gold and silver is heating up over in Europe as well.  For example, the following is from an emergency message posted on the website of a precious metals dealer in the UK …


Due to the unprecedented demand triggered by the recent fall in the Gold Price we are currently not able to guarantee Next Day Delivery of orders.

We anticipate that all orders will be delivered within seven days of receipt by us.

Whilst we appreciate that these delays are frustrating for our customers we would like to stress that all accepted orders are guaranteed at the order price and will be dispatched as soon as possible.

It is necessary for all of our staff to be utilised in fulfilling orders and we ask for your cooperation by not calling us to query delivery times. If you do need to contact us, please do so by e-mail and we will endeavour to respond within 48 hours.


#6 On the other side of the globe, demand for precious metals is skyrocketing as well.  According to Bloomberg, people are “running through the gate” to get gold in Australia …


Gold sales from Australia’s Perth Mint, which refines nearly all of the nation’s bullion, surged after prices plunged, adding to signs that the metal’s slump to a two-year low is spurring increased demand.

“The volume of business that we’re putting through is way in excess of double what we did last week”, Treasurer Nigel Moffatt said by phone, without giving precise figures. “There’s been people running through the gate”.


#7 Reuters is reporting that customers are waiting for up to three hours to buy gold in Japan …


A week ago, as the yen-denominated price neared a new peak, jewelry stores and gold merchants across Japan saw long lines of mostly older Japanese looking to cash in on unwanted jewelry and other items that they had held for years.

But on Tuesday, buyers outnumbered sellers by a wide margin. At Ginza Tanaka, the headquarters shop of Tanaka Holdings, gold buyers waited for as long as three hours for a chance to complete a transaction.


#8 According to a Chinese article quoted by the Blaze, there is a mad rush to buy gold in China right now …


People have to rush to buy gold … gold bullion out of stock yesterday, investors yesterday to spend as much as 600 million yuan to buy twenty kilograms of gold bars.

The mad pursuit gold insufficiency is not just a game for the rich. Yesterday, the Yangcheng Evening News reporter learned from the East flowers to Bay store, many growers, pork traffickers, fishmonger recently put down his job went straight to the mall to buy gold.



#9 According to Reuters, dealers in Singapore are having significant trouble finding enough of a supply to keep up with the intense demand for gold that has erupted this week …


“People are actually buying everything, gold bars, gold coins. People are rushing to get a hand on it. We have a problem meeting the demand because we are unable to get new supply”, said Brian Lan, managing director of GoldSilver Central Pte Ltd in Singapore.


#10 Bloomberg is reporting that over in India people are “flocking to stores” to purchase gold jewelry and coins …


Gold buyers in India, the world’s biggest consumer, are flocking to stores to buy jewelry and coins, betting a selloff that plunged bullion to a two-year low may be overdone.

“My daughter is just six months old, but I think it is never too early to buy gold”, said Sharmila Shirodkar, a 28-year-old housewife, while displaying a new pair of earrings she bought from a store in Mumbai’s Zaveri Bazaar. “I had been asking my husband every day if prices will go down more. I couldn’t wait anymore.”


If the big banks were trying to scare people away from gold and silver by crashing paper prices for those metals then they have utterly failed.

Instead of being frightened away, the global appetite for physical gold and silver is now more voracious than ever.

If the prices for gold and silver stay this low, we are eventually going to start seeing some very serious shortages in the marketplace.

And once reports of shortages of the actual physical metals become widely circulated, it will cause an “adjustment” in the marketplace that will shock everyone.

So hold on to your hats.  We are entering a period of time when there will be unprecedented volatility for the prices of precious metals.  It will be quite a roller coaster ride, but if you can handle the ups and downs it will be worth it in the end.


The original version of this article, at the URL below, contains several links to further information not included here.