Sunday, October 31, 2010
Elections: The Day After
October 31, 2010 | Know | CommonDreams
November 2 is going to be a big day in our political lives.
But November 3 will be far more important.
On mid-term Election Day, voters will choose between candidates with different positions on health-care insurance, withdrawal from Afghanistan, and CO2 levels that drive global warming. The politicians we send to the legislatures and executive offices will make -- or avoid making -- important decisions. Our votes matter.
But Election Day is far from the most important moment in our political lives. The radical changes necessary to produce a just and sustainable society are not on the table for politicians in the Republican or Democratic parties, which means we citizens have to commit to ongoing radical political activity after the election.
I use the term "radical" -- which to some may sound extreme or even un-American -- to mark the importance of talking bluntly about the problems we face. In a political arena in which Tea Partiers claim to defend freedom and centrist Democrats are called socialists, important concepts degenerate into slogans and slurs that confuse rather than clarify. By "radical," I mean a politics that goes to the root to critique the systems of power that create the injustice in the world and an agenda that offers policy proposals that can change those systems.
In previous essays in this campaign series on economics, empire, and energy, I argued that the conventional debates in electoral politics are diversionary because painful realties about those systems are unspeakable in the mainstream: capitalism produces obscene inequality, U.S. attempts to dominate the globe violate our deepest moral principles, and there are no safe and accessible energy sources to maintain the affluent lifestyles of the First World.
Why would politicians be unwilling to engage these ideas? Part of the answer lies in who pays the bills; campaigns and political parties are funded primarily by the wealthy, who have a stake in maintaining the system that made them wealthy. Also crucial is the ideology that pervades the dominant society; people have been subject to decades of intense propaganda that has tried to make predatory corporate capitalism and U.S. imperial domination of the world seem natural and inevitable.
As a result of these economic and political systems, 20 percent of the U.S. population controls 85 percent of the country's wealth, and half the world's population lives in abject poverty. None of that is natural or inevitable. This inequality is the product of human choices that benefit a relatively small elite, who buy off middle- and working-class people with a small cut of the wealth. This state of affairs is the product of policies that were chosen, and can be chosen differently.
Because these crucial questions are not on the agenda for the two dominant parties battling on November 2, we have to commit to a radical citizens' agenda on November 3. The first step is building and fortifying -- both the local grassroots institutions that can work independently of the powerful, and the networks of empathy and caring that will be needed if we are to survive the fraying of the systems in which we live.
For that work, don't look to the corporate bosses or the politicians they employ. Look to the person sitting next to you.
Robert Jensen is a journalism professor at the University of Texas at Austin and board member of the Third Coast Activist Resource Center. His latest book is Getting Off: Pornography and the End of Masculinity (South End Press, 2007). Jensen is also the author of The Heart of Whiteness: Race, Racism, and White Privilege and Citizens of the Empire: The Struggle to Claim Our Humanity (both from City Lights Books); and Writing Dissent: Taking Radical Ideas from the Margins to the Mainstream (Peter Lang). He can be reached at firstname.lastname@example.org and his articles can be found online here.
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Posted by mammonmessiah at 11:29 AM
Yes, Of Course They're Brownshirts. What The Hell Did You Expect?
By David Michael Green article link
October 30, 2010 | OpEdNews
You know, I hate like hell using the tired old Nazi analogy.
For one thing, everybody does it, and everybody does it all the time. It hasn't exactly earned an A for originality in about a half century now.
For another thing, not only does everybody do it, but now complete idiots who couldn't pour piss out of a boot if the instructions were written on the heel are doing it too, and of course they're too dumb to even use the term properly. You can't foam at the mouth about what a freaking socialist Barack Obama is and then call him a Nazi at the same time. Unless, of course, you happen not to mind looking like a moron. Which, of course, all too many Americans don't anymore. But here's a hint to all y'all in the ganglion-cyst-where-there's-supposed-to-be-an-actual-brain crowd: Nazis hate socialists. Indeed, they murder them, along with Jews and Gypsies and homosexuals. Get it?
And then there's a third reason to avoid the Nazi analogy, namely that because everyone else is doing it, the term has now been diluted to the point of lacking all impact or meaning anymore. If everyone's a Nazi, no one is.
All good reasons not to use the term.
But, that said, there are also three good reasons to do just that.
One is that people sometimes do act like Nazis. In fact, a lot of them. Especially lately.
The second is that if you wait too long to point that out, it won't much matter anymore.
And the third is that if you wait too long to point that out, you won't be able to anyhow. Indeed, you probably won't even be. Period.
And so, with appropriate reluctance, I feel compelled to note that the wheels are coming of the wagon in America right now, and it does indeed smell all too much like a Germany-in-the-1930s kinda moment.
American politics have been driven to a fever pitch, even though no one is talking about the real problems the country faces. The radical right has induced those problems with their kleptocratic policies. They have then demonized as un-American anyone who would dare offer even the most tepid (non-)solutions to those problems. They have captured control of the legislative and executive branches of government by means of purchasing politicians wholesale. Those politicians have, in turn, appointed justices to the federal bench, such that the regressives own that institution, as well. The Supreme Court has recently handed down decisions that set aflame even the tattered legal shreds once remaining between corporate money and government power. They are doing the same at the state level. The Court even ruled that judges receiving campaign contributions from litigants appearing before their bench did not need to recuse themselves from the case. In America today it's bought legislation, bought (non-)regulation, bought (non-)justice.
Now the latest trend from our good friends on the right is to go after the 17th Amendment, that heinous bit of federal tyranny that forces the public to choose their own senators through the ballot box, rather than having (bought) state legislatures do it.
Meanwhile, the plutocratic string-pullers have marshaled massive sums of money for purposes of organizing angry white seniors into an army of Know Nothings, about to send as scary a crop of folks to Washington as have been found since... Well, you know when.
Like Joe Miller in Alaska, for instance, who wants to kill the minimum wage, and who rails against the oppressive tyranny of federal socialism, even though he and his family have taken every kind of subsidy and payment Washington has to offer. Perhaps that's part of why he started refusing to take questions about his personal background last week. Although that probably also had something to do with him not wanting to discuss the fact that he had used public office in the past to help steal elections.
Or there's Rand Paul in Kentucky, who doesn't seem to mind the prospect of hotels and restaurants posting "Whites Only" signs in their windows, and would thus be okay with repealing the Civil Rights Act.
Or maybe you prefer Wisconsin Senate candidate Ron Johnson who once testified against strengthening pedophilia laws because of the potential costs to business.
Then there's Ken Buck (and four other GOP Senate candidates), who want to make abortion illegal, even in cases of rape or incest. Buck also wants to make birth control and fertility treatment illegal.
Or Jim DeMint, already in the Senate from South Carolina, who argues that unmarried sexually active women should not be allowed to teach in public schools.
Or the guy in Michigan, a sitting Congressman, who is already calling for the impeachment of Barack Obama.
Or the California candidate who wants to eliminate all public schools. Woo-hoo! No more homework!
Or Sharon Angle, who has suggested that we solve our health care crisis by just returning to the good old days of the barter system, so that patients could presumably then bring in a chicken and exchange it for an angiogram. She has also called for "Second Amendment solutions" "to protect people against a tyrannical government". In case you're somehow unsure, what that means is that if Barack Obama and Harry Reid cannot be removed from office by the ballot box, she thinks someone should pick up a gun and shoot them for the despotic crime of creating a national health care system.
Then there's Rich Iott, a congressional candidate who likes to dress up with his kids as Nazi SS officers. (Or is he actually a Nazi SS officer who sometimes dresses up as a normal person? Hard to tell with this lot, I'm afraid.)
But surely the best is Republican Senate nominee Christine O'Donnell of Delaware, who once "dabbled in witchcraft", does not appear to have had any profession in decades other than running for office, told no less than three major lies about three different educational institutions she claims to have attended, and said that "evolution is a myth" because she doesn't see monkeys evolving right before her eyes. She does have one redeeming virtue, though. She has been a long-time advocate against masturbation, which I think we can all agree is an American epidemic today, threatening our nation to its core. (You know who you are, people.)
As hysterical as this gang would be if it weren't for the fact that they're about to become the government of the world's only superpower, it's actually not funny at all.
Because even this insanity is not enough for them. This week the stompings began in earnest.
Miller had a reporter handcuffed and "arrested" by his private security goon squad at a public rally for the crime of asking questions about the candidate's secret election-stealing past.
Meanwhile, a young female MoveOn activist at a Rand Paul rally, who was doing nothing other than carrying a sign and trying to speak to the candidate, was thrown to the ground and had her head stomped by one of his staff. This pot-bellied oaf, who seemed in the video to get off on kicking women around later actually demanded that she apologize to him. For what, I'm not sure. Getting blood on the sole of his shoes perhaps?
And just last week, the courts dismissed the appeal of several individuals who had been on the way to a public George Bush event several years ago, without intent to speak, but never got there. They were arrested as soon as they got out of their car because it had the wrong bumper sticker on it. Somehow, the Republican appointees to the appeals court could find no constitutional provision which the police's behavior might have violated. Presumably, their copy of the Bill of Rights begins (and likely ends too) with the Second Amendment. And a distorted version of that amendment, to boot.
Like decent Germans of the 1930s let alone progressive ones no doubt did, I have spent the better part of the last decade repeatedly wondering where the bottom of the barrel of stupidity, laziness, greed and criminality can be found amongst the tribe called the the American public. Each time I think, "This is it it can't possibly get worse", I am rudely reminded again of my foolishness. It's a legitimate question to ask why I continue to be so naive, but there's actually a very good answer. It's not naivete at all. It's just that I grew up in the foreign country known as mid-twentieth century America. For all its faults and it had plenty it was never like this. It's therefore not naive to think it could be that way again.
And it wasn't naive to think, two years ago, that perhaps we were headed back toward some form of basic decency, definitely a repudiation of the evils of regressivism, and maybe even a new progressive era.
Now we have instead the worst imaginable scenario. We have a society in which near-dead regressivism has been revived, only in a more virulent form. And we have a society in which progressivism, which never even remotely took the stage, has been reviled for its supposed failings.
Each election cycle just brings uglier politics and greater transgressions, rapidly approaching the fail-safe point, beyond which any democracy is unsustainable. Now comes the tea party movement, the nastiest thing to happen to America since... well, the Bush administration.
This is the crossroads. This is the moment of truth, folks. This is the test. The destructive dogs of regressivism are baying outside our door. Many of them are inside already. They will not rest until they have looted the public of every last shekel to be had, and until they have ground into submission every last avenue for the little guy to seek even a modicum of justice.
To do that, it will also be required that all pretense of democracy and civil liberty will have to be destroyed as well. It may additionally be required that wars will have to be launched, in order to simultaneously divert public attention, crush domestic opposition, steal from the weak, and stimulate the moribund economy that the kleptocracy's policies have already created.
The right hasn't got the slightest plan for solving the country's problems. That's because they haven't got the slightest interest in doing so. That is not their function, and has not remotely been their function for thirty years now. They are here to rape the maiden called America and steal from her everything of value. Once they have done so, they will leave her body in the gutter, damaged, defiled and degraded. Erik Prince has shown the path for others to follow. His mercenary company, Blackwater Worldwide, which has grown unbelievably rich helping the Bush and Obama administrations fight two wars while avoiding a draft, is for sale and its former top managers are facing criminal charges. The appropriately-named Prince himself has left the United States and moved to Abu Dhabi. Noted a friend of his, "He needs a break from America". Yeah. Just like a chronic thief needs a break from courtrooms.
But governing in the absence of actual solutions to satisfy an angry electorate will fast prove problematic for the GOP, just as it did for them in 2008. This will be the most dangerous moment for the country, the historical linchpin juncture. The public will still be clamoring for solutions, and will be ready once again to turn out the Republicans for lacking same, just as it did two years ago, and just as it's doing now to the pathetic Democrats. This cannot be tolerated by the oligarchs, of course, and a decision will have to be made whether they are bold enough to double down and burn the Reichstag, eliminating the pesky albatross of elections once and for all. Bold enough? The folks who brought you Election 2000? The Iraq War? Legalized looting by Wall Street? A filibuster-crazed Senate?
This scenario is all possible, of course, because of the complete and utter failure in every sense of the word of the Democrats these last two years. That assessment assumes, though, that Democrats were somehow more sincere about wanting to serve the public than are Republicans. With a few rare exceptions, I don't harbor that illusion about any of them. However, I will confess that I expected them to at least seek to protect themselves and therefore do enough to get reelected. Not only have they not, they have succeeded in achieving what seemed like a miraculously improbable possibility only just a year or two ago. They have revived an opposition party that was utterly loathed and lying on death's door.
Skillful political maneuvering, combined with moderately contemporary communications strategy and even the slightest accidental wisp of intestinal fortitude would have been enough to push that party over the cliff and end its ugly reign for a couple of generations, if not forever. And, yes, that could even have been done without necessarily solving the problem of the recession right away. Just ask Franklin Roosevelt, who won four terms as president without really fixing the Great Depression. Ask FDR, that is, if he hasn't picked up his corpse and moved to Canada by now, out of sheer disgust for his country of birth and, especially, the party his efforts invigorated for half a century.
But instead of Roosevelt, we have this other guy. This Neville Chamberlain dude. I regret to say that I think history will show the crimes of Barack Obama to be of incalculable damage.
Most astonishingly, they persist even still. I've given up expecting the guy to ever grow a pair of balls. But how about just some basic sentient consciousness? You would think that after the last two years, and with the humiliating drubbing he's going to take on Tuesday, that he would at least awake enough to realize what is happening here. But no. This week I saw video clips of Obama, Joe Biden and Harry Reid three walking corpses if ever there were such talking about how hopeful they are that Republicans will grow more cooperative following this election. Say what?!?! Are these guys insane?!?! Are they on drugs?!?!
Even if they couldn't possibly figure it out for themselves, it just so happened that this very same week, Mitch McConnell and John Boehner and Mike Pence were all out there explicitly saying "There will be no compromise by Republicans in the next Congress". But it will be, of course, far worse than that. The right will be hounding Mr. Hapless Happy Face mercilessly for the next two years, investigating every bogus claim they can fabricate, and probably also running another impeachment scam. Which is likely to turn out very differently this time. Back in the 1990s, I used to say that Bill Clinton was very lucky to be impeached at a time when the economy was fat. You might have noticed that it is somewhat less so today...
George W. Bush was indisputably the worst president in American history, but now Obama is remarkably giving him a run for it. Bush poisoned the body politic, but Obama is standing by and watching it die. Obama's crimes are of incalculable historical damage for the same reason that most scholars of the presidency (used to) judge James Buchanan to have been the worst president ever. Both fiddled while the republic burned.
In Obama's case, the indictment is worse, however. First because, like Bush, he is owned by the oligarchy and serves their interests far above anyone else's. Let's please start calling this what it is: This is a case of treason, pure and simple. Second, because, unlike Clinton perhaps, he had every reason to foresee the viciousness of the last two years coming from a thousand miles away, and yet he acted like the Republican Party of Atwater and Rove and Gingrich and Limbaugh and Beck was something that could be reasoned with, something with which to negotiate. And third, because he campaigned on the premise of the audacity of hope, but instead delivered the duplicity of despair. He would be far less culpable had he not raised people's expectations so dramatically. "Yes we can!" Can what? Govern as George W. Bush's third term?
History will be very unkind to Obama, but whatever. He's virtually irrelevant at this point. He's a dead man walking, and has been right from the beginning. It all started going south even before he took office with the appointment to his cabinet of Wall Street bandits from the Robert Rubin cabal, along with other sundry regressives. But I knew it was over when at the moment of his inaugural address he skipped the opportunity to articulate a broad, bold and honest vision of the national trajectory, and treated the record crowds who came to bear the freezing cold weather in order to be a part of history to a standard issue patchwork of platitudes instead.
Mitch McConnell said this week that his primary goal for the coming two years was to turn Barack Obama into a one-term president. Hmm. I would have thought the GOP had higher aspirations, since the Capitulation King has already taken care of that himself. If that wasn't already abundantly clear, the New York Times published some astonishing poll data the other day, documenting the extent of his party's hemorrhaging support under Obama's helm. In 2008, women (women!) voted Democratic by a 13 percent margin, and now they have swung to 4 percent in favor of Republicans. College graduates went from 2 percent Democratic to 20 percent Republican today. Catholics voted 10 percent Democratic in 2008 and are now polling 24 percent Republican. That's a 34 percent swing in less than two years! People with an income under $50,000 voted 22 percent Democratic in 2008 but are now actually polling at 2 percent Republican! Just what magnitude of idiocy does it require to drive the working class and poor into voting Republican during a massive recession? And independents, who went for Democrats in 2008 by an 8 point margin are now going for Republicans by 20 points nearly a 30 percent swing in this key constituency. The repudiation of this failed presidency is now reaching epic proportions.
That's fine with me. Obama amply deserves the lashing and humiliation he's going to receive Tuesday, and then again two years later. The White House is no place for the cowardly. In normal times that would be an embarrassment. In a moment of national crisis, it's a sin. But when the republic itself is being threatened, and when the very ideas of democracy and freedom are in jeopardy, timidity is treason.
And that is precisely where we are now. People are growing desperate. Each time someone comes along and offers them some relief but doesn't deliver, they become yet more willing still to let the most outrageous actors take control of the government. Anyone who promises solutions is acceptable, including people who during normal times would have been considered darkly dangerous, just plain laughable, or both.
I'm sorry. I really don't want to ring that ubiquitous Nazism-threat bell yet again.
But wasn't that precisely how it went down in 1933?
David Michael Green is a professor of political science at Hofstra University in New York. He is delighted to receive readers' reactions to his articles (email@example.com), but regrets that time constraints do not always allow him to respond. His website is www.regressiveantidote.net.
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The wretched mind of the American authoritarian
by Glenn Greenwald article link
October 29, 2010 | Salon
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The Most Racist Campaign in Decades, and What It Demands of Us
Thursday 28 October 2010 | ColorLines | Truthout
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2010 Election: Referendum on Reality, Racism, and Revisionist History
by Bill Noxid article link
October 28, 2010 | Information Clearing House
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Cash and Carry: The Business of American Politics and the Politics of Business
October 30, 2010 | OpEdNews | CommonDreams | Global Research
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A Democracy of Bags Stuffed with Cash
October 29, 2010 | TomDispatch | CommonDreams
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Posted by mammonmessiah at 11:20 AM
Saturday, October 30, 2010
Road to Corporate Serfdom
October 30, 2010 | Ralph Nader | CommonDreams
It was Bill Clinton’s campaign strategist, James Carville, who in 1992 created the election slogan: “It’s the Economy, Stupid.” For the 2010 Congressional campaigns, the slogan should have been: “It’s Corporate Crime and Control, Stupid.”
But notwithstanding the latest corporate crime wave, the devastating fallout on workers, investors and taxpayers from the greed and corruption of Wall Street, and the abandonment of American workers by U.S. corporations in favor of repressive regimes abroad, the Democrats have failed to focus voter anger on the corporate supremacists.
The giant corporate control of our country is so vast that people who call themselves anything politically—liberal, conservative, progressive, libertarian, independents or anarchist—should be banding together against the reckless Big Business steamroller.
Conservatives need to remember the sharply critical cautions against misbehaving or over-reaching businesses and commercialism by Adam Smith, Frederic Bastiat, Friedrich Hayek and other famous conservative intellectuals. All knew that the commercial instinct and drive know few boundaries to the relentless stomping or destruction of the basic civic values for any civilized society.
When eighty percent of the Americans polled believe ‘America is in decline,’ they are reflecting in part the decline of real household income and the shattered bargaining power of American workers up against global companies.
The U.S. won World War II. Germany lost and was devastated. Yet note this remarkable headline in the October 27th Washington Post: “A Bargain for BMW means jobs for 1,000 in S. Carolina: Workers line up for $15 an hour—half of what German counterparts make.”
The German plant is backed by South Carolina taxpayer subsidies and is not unionized. Newly hired workers at General Motors and Chrysler, recently bailed out by taxpayers, are paid $14 an hour before deductions. The auto companies used to be in the upper tier of high paying manufacturing jobs. Now the U.S. is a low-wage country compared to some countries in Western Europe and the trend here is continuing downward.
Workers in their fifties at the BMW plant, subsidizing their lower wages with their tax dollars, aren’t openly complaining, according to the Post. Not surprising, since the alternative in a falling economy is unemployment or a fast food job at $8 per hour.
It is not as if we weren’t forewarned by our illustrious political forebears Fasten your seat belts; here are some examples:
Thomas Jefferson—“I hope that we shall crush in its birth the aristocracy of our monied corporations, which dare already to challenge our government to a trial of strength, and bid defiance to the laws of our country.”
Abraham Lincoln in 1864—“I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country. …corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed.” (1864)
Theodore Roosevelt—“The citizens of the United States must control the mighty commercial forces which they themselves call into being.”
Woodrow Wilson—“Big business is not dangerous because it is big, but because its bigness is an unwholesome inflation created by privileges and exemptions which it ought not to enjoy.”
Franklin D. Roosevelt—“The first truth is that the liberty of a democracy is not safe if the people tolerate the growth of private power to a point where it becomes stronger than their democratic state itself. That, in its essence, is Fascism—ownership of Government by an individual, by a group, or by any other controlling private power.”
Dwight Eisenhower, farewell address—“In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex.”
And, lastly, a literary insight:
Theodore Dreiser—“The government has ceased to function, the corporations are the government.”
Are you, dear reader, the same now as you were when you began reading this column?
Ralph Nader is a consumer advocate, lawyer, and author. His most recent book - and first novel - is, Only The Super-Rich Can Save Us. His most recent work of non-fiction is The Seventeen Traditions.
Posted by mammonmessiah at 9:43 AM
Friday, October 29, 2010
By understanding that money is simply credit, we unleash it as a powerful tool for our communities.
Time for a New Theory of Money
October 29, 2010 | YES! Magazine | CommonDreams
The reason our financial system has routinely gotten into trouble, with periodic waves of depression like the one we’re battling now, may be due to a flawed perception not just of the roles of banking and credit but of the nature of money itself. In our economic adolescence, we have regarded money as a “thing”—something independent of the relationship it facilitates. But today there is no gold or silver backing our money. Instead, it’s created by banks when they make loans (that includes Federal Reserve Notes or dollar bills, which are created by the Federal Reserve, a privately-owned banking corporation, and lent into the economy). Virtually all money today originates as credit, or debt, which is simply a legal agreement to pay in the future.
Money as Relationship
In an illuminating dissertation called “Toward a General Theory of Credit and Money” in The Review of Austrian Economics, Mostafa Moini, Professor of Economics at Oklahoma City University, argues that money has never actually been a “commodity” or “thing.” It has always been merely a “relation,” a legal agreement, a credit/debit arrangement, an acknowledgment of a debt owed and a promise to repay.
The concept of money-as-a-commodity can be traced back to the use of precious metal coins. Gold is widely claimed to be the oldest and most stable currency known, but this is not actually true. Money did not begin with gold coins and evolve into a sophisticated accounting system. It began as an accounting system and evolved into the use of precious metal coins. Money as a “unit of account” (a tally of sums paid and owed) predated money as a “store of value” (a commodity or thing) by two millennia; the Sumerian and Egyptian civilizations using these accounting-entry payment systems lasted not just hundreds of years (as with some civilizations using gold) but thousands of years. Their bank-like ancient payment systems were public systems—operated by the government the way that courts, libraries, and post offices are operated as public services today.
In the payment system of ancient Sumeria, goods were given a value in terms of weight and were measured in these units against each other. The unit of weight was the “shekel,” something that was not originally a coin but a standardized measure. She was the word for barley, suggesting the original unit of measure was a weight of grain. This was valued against other commodities by weight: So many shekels of wheat equaled so many cows equaled so many shekels of silver, etc. Prices of major commodities were fixed by the government; Hammurabi, Babylonian king and lawmaker, has detailed tables of these. Interest was also fixed and invariable, making economic life very predictable.
Grain was stored in granaries, which served as a form of “bank.” But grain was perishable, so silver eventually became the standard tally representing sums owed. A farmer could go to market and exchange his perishable goods for a weight of silver, and come back at his leisure to redeem this market credit in other goods as needed. But it was still simply a tally of a debt owed and a right to make good on it later. Eventually, silver tallies became wooden tallies became paper tallies became electronic tallies.
The Credit Revolution
The problem with gold coins was that they could not expand to meet the needs of trade. The revolutionary advance of medieval bankers was that they succeeded in creating a flexible money supply, one that could keep pace with a vigorously expanding mercantile trade. They did this through the use of credit, something they created by allowing overdrafts in the accounts of their depositors. Under what came to be called “fractional reserve” banking, the bankers would issue paper receipts called banknotes for more gold than they actually had. Their shipping clients would sail away with their wares and return with silver or gold, settling accounts and allowing the bankers’ books to balance. The credit thus created was in high demand in the rapidly expanding economy; but because it was based on the presumption that money was a “thing” (gold), the bankers had to engage in a shell game that periodically got them into trouble. They were gambling that their customers would not all come for their gold at the same time; but when they miscalculated, or when people got suspicious for some reason, there would be a run on the banks, the financial system would collapse, and the economy would sink into depression.
Today, paper money is no longer redeemable in gold, but money is still perceived as a “thing” that has to “be there” before credit can be advanced. Banks still engage in money creation by advancing bank credit, which becomes a deposit in the borrower’s account, which becomes checkbook money. In order for their outgoing checks to clear, however, the banks have to borrow from a pool of money deposited by their customers. If they don’t have enough deposits, they have to borrow from the money market or other banks.
As British author Ann Pettifor observes: "the banking system... has failed in its primary purpose: to act as a machine for lending into the real economy. Instead the banking system has been turned on its head, and become a borrowing machine."
The banks suck up cheap money and return it as more expensive money, if they return it at all. The banks control the money spigots and can deny credit to small players, who wind up defaulting on their loans, allowing the big players with access to cheap credit to buy up the underlying assets very cheaply.
That’s one systemic flaw in the current scheme. Another is that the borrowed money backing the bank’s loans usually comes from shorter-term loans. Like Jimmy Stewart’s beleaguered savings and loan in It’s a Wonderful Life, the banks are “borrowing short to lend long,” and if the money market suddenly dries up, the banks will be in trouble. That is what happened in September 2008: According to Rep. Paul Kanjorski, speaking on C-Span in February 2009, there was a $550 billion run on the money markets.
Securitization: “Monetizing” Loans Not with Gold But with Homes
The money markets are part of the “shadow banking system,” where large institutional investors park their funds. The shadow banking system allows banks to get around the capital and reserve requirements now imposed on depository institutions by moving loans off their books.
Large institutional investors use the shadow banking system because the conventional banking system guarantees deposits only up to $250,000, and large institutional investors have much more than that to move around on a daily basis. The money market is very liquid, and what protects it in place of FDIC insurance is that it is “securitized,” or backed by securities of some sort. Often, the collateral consists of mortgage-backed securities (MBS), the securitized units into which American real estate has been sliced and packaged, sausage-fashion.
Like with the gold that was lent many times over in the 17th century, the same home may be pledged as “security” for several different investor groups at the same time. This is all done behind an electronic curtain called MERS (an acronym for Mortgage Electronic Registration Systems, Inc.), which has allowed houses to be shuffled around among multiple, rapidly changing owners while circumventing local recording laws.
As in the 17th century, however, the scheme has run into trouble when more than one investor group has tried to foreclose at the same time. And the securitization model has now crashed against the hard rock of hundreds of years of state real estate law, which has certain requirements that the banks have not met—and cannot meet, if they are to comply with the tax laws for mortgage-backed securities. (For more on this, see here.)
The bankers have engaged in what amounts to a massive fraud, not necessarily because they started out with criminal intent (although that cannot be ruled out), but because they have been required to in order to come up with the commodities (in this case real estate) to back their loans. It is the way our system is set up: The banks are not really creating credit and advancing it to us, counting on our future productivity to pay it off, the way they once did under the deceptive but functional façade of fractional reserve lending. Instead, they are vacuuming up our money and lending it back to us at higher rates. In the shadow banking system, they are sucking up our real estate and lending it back to our pension funds and mutual funds at compound interest. The result is a mathematically impossible pyramid scheme, which is inherently prone to systemic failure.
The Public Credit Solution
The flaws in the current scheme are now being exposed in the major media, and it may well be coming down. The question then is what to replace it with. What is the next logical phase in our economic evolution?
Credit needs to come first. We as a community can create our own credit, without having to engage in the sort of impossible pyramid scheme in which we’re always borrowing from Peter to pay Paul at compound interest. We can avoid the pitfalls of privately-issued credit with a public credit system, a system banking on the future productivity of its members, guaranteed not by “things” shuffled around furtively in a shell game vulnerable to exposure, but by the community itself.
The simplest public credit model is the electronic community currency system. Consider, for example, one called “Friendly Favors.” The participating Internet community does not have to begin with a fund of capital or reserves, as is now required of private banking institutions. Nor do members borrow from a pool of pre-existing money on which they pay interest to the pool’s owners. They create their own credit, simply by debiting their own accounts and crediting someone else’s. If Jane bakes cookies for Sue, Sue credits Jane’s account with 5 “favors” and debits her own with 5. They have “created” money in the same way that banks do, but the result is not inflationary. Jane’s plus-5 is balanced against Sue’s minus-5, and when Sue pays her debt by doing something for someone else, it all nets out. It is a zero-sum game.
Community currency systems can be very functional on a small scale, but because they do not trade in the national currency, they tend to be too limited for large-scale businesses and projects. If they were to grow substantially larger, they could run up against the sort of exchange rate problems afflicting small countries. They are basically barter systems, not really designed for advancing credit on a major scale.
The functional equivalent of a community currency system can be achieved using the national currency, by forming a publicly owned bank. By turning banking into a public utility operated for the benefit of the community, the virtues of the expandable credit system of the medieval bankers can be retained, while avoiding the parasitic exploitation to which private banking schemes are prone. Profits generated by the community can be returned to the community.
A public bank that generates credit in the national currency could be established by a community or group of any size, but as long as we have capital and reserve requirements and other stringent banking laws, a state is the most feasible option. It can easily meet those requirements without jeopardizing the solvency of its collective owners.
For capital, a state bank could use some of the money stashed in a variety of public funds. This money need not be spent. It can just be shifted from the Wall Street investments where it is parked now into the state’s own bank. There is precedent establishing that a state-owned bank can be both a very sound and a very lucrative investment. The Bank of North Dakota, currently the nation’s only state-owned bank, is rated AA and recently returned a 26 percent profit to the state. A decentralized movement has been growing in the United States to explore and implement this option. [For more information, see public-banking.com.]
We have emerged from the financial crisis with new clarity: Money today is simply credit. When the credit is advanced by a bank, when the bank is owned by the community, and when the profits return to the community, the result can be a functional, efficient, and sustainable system of finance.
Ellen Brown wrote this article for YES! Magazine, a national, nonprofit media organization that fuses powerful ideas with practical actions. Ellen is an attorney and the author of eleven books, including Web of Debt: The Shocking Truth About Our Money System and How We Can Break Free. Her websites are webofdebt.com, ellenbrown.com, and public-banking.com.
* Whose Bank? Public Investment, Not Private Debt: The public bank concept is gaining ground on the state level, attracting proponents across the political spectrum.
* New Economy, New Ways to Do Finance: As mega-finance crumbles, many farsighted individuals are putting their money in enterprises and financial institutions that benefit working Americans and the places they live.
* Move Your Money and Save: Big banks don't just undermine local economies—they're bad for your wallet, too.
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Posted by mammonmessiah at 11:22 AM
Thursday, October 28, 2010
Bank Job: Make Rogue Corporations Pay for Foreclosure Crisis
by Ted Rall article link
October 28, 2010 | CommonDreams
BOSTON--"We know how to prevent foreclosures," Federal Reserve Bank senior economist Paul Willen told The New York Times. "We just need to be prepared to spend the money." Willen "sees two possible solutions: Require banks to modify loans, basically imposing the cost on them; or pay banks to modify loans, imposing the cost on taxpayers."
Millions of American families have lost their homes to foreclosure since the global economy crashed in 2008. At this writing 4.4 million more households are in severe default on their mortgages--and that doesn't count the millions of renters who are getting evicted.
A few distressed homeowners are professional "flippers" who took out short-term adjustable-rate mortgages on dozens of houses at a time. When the housing bubble burst, their dream of easy profits using borrowed cash to turn a quick profit blew up too.
But that's a rare story. The overwhelming majority are people who got into trouble through no fault of their own. Most lost their job or suffered a medical catastrophe. They're victims of the usual boom-and-bust cycle of corporate capitalism.
Laissez-faire conservatives argue that that things will sort themselves out and that society will wind up stronger as the result of "creative destruction." But the scale of the post-2008 Depression is too big to sit on our hands. One out of four Americans face current or imminent joblessness. Poverty and homelessness are about to skyrocket.
Most frightening, there is no hope of economic improvement. Obama hasn't enacted a jobs program. There's no new technology waiting in the wings to spur economic growth, as the Internet did during the 1990s. The cavalry won't be foreign investment--the rest of the world is struggling too.
The social, political--and yes, economic--consequences of creating a new vast permanent underclass are terrifying to contemplate. Theft and random violence will rise. As we're seeing with the Tea Party, right-wing demagogues will gain power. People do bad things and listen to bad people when they're afraid. The U.S. could easily end up looking like Russia.
In 2009 the Obama Administration announced a new program, Make Home Affordable, to assist distressed homeowners. But--unsurprisingly, since it was voluntary and therefore toothless--MHA has been a bust. Fewer than 500,000 households have received modifications to their mortgages. As I can personally attest, banks like Citibank, Chase and Bank of America intentionally "lost" paperwork they requested so they could evict their customers and seize their homes as quickly as possible--frequently using fraudulent documents bearing forged signatures. FDIC chairperson Sheila Bair said: "We...know that in too many instances, servicers have not made meaningful efforts to restructure loans for borrowers who have documented that they are in economic distress."
That's for sure. When I lost my half my income in 2009, Chase Home Finance advised me that getting laid off had not adversely affected my financial status.
Millions of mortgages are going to need reduced interest rates and lower principal to reflect the new reality of the housing Markey. So who's going to pay?
It would be unfair to dun the taxpayers for the cost of loan modifications. First and foremost, many people rent. Why should people who can't afford the American Dream subsidize it for others?
Besides, the taxpayers already paid. The 2008 TARP bailout should have gone to the unemployed and homeowners facing foreclosure; when they paid their mortgages this would have wiped those "toxic assets" off the banks' books. Trickle-up economics works; trickle-down doesn't.
At bare minimum, banks that can't find the note to prove they own a home in foreclosure, and those who used fraudulent "robo-signers" to sign court documents, ought to lose their mortgages outright. In a tidy bit of justice, this would be fair punishment while allowing hundreds of thousands, possibly millions, of people to stay in their homes.
Next an investigation should be conducted of general bank malfeasance during the go-go '90s and '00s. Any bank that charged exorbitant interest rates on credit cards, ravaged debit card users with insane ATM fees, and failed to notify borrowers of the terms of their adjustable mortgages, should similarly face the only sanction they might remember the next time they're tempted to behave indecently: all their mortgages and credit card debt lines ought to be wiped clean.
Copyright 2010 Ted Rall, Distributed by Universal Uclick/Ted Rall
Ted Rall is in Afghanistan to cover the war and research a book. He is the author of "The Anti-American Manifesto," which will be published in September by Seven Stories Press. His website is tedrall.com.
Real Family Values
9 progressive policies to support our families.
October 27, 2010 | YES! Magazine | CommonDreams
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Posted by mammonmessiah at 10:17 AM
Wednesday, October 27, 2010
If We Quit Voting
by Frank Chodorov article link
This essay originally appeared in July 1945 in a monthly newsletter Chodorov established called analysis. It later appeared as a chapter in his book Out of Step: The Autobiography of an Individualist (1962).
New York in midsummer is measurably more miserable than any other place in this world – and should be comparable to the world for which all planners are headed. Why New Yorkers, otherwise sane, should choose to parboil their innards in a political campaign during this time of the year is a question that comes under the head of man's inscrutable propensity for self-punishment. And if a fellow elects to let the whole thing pass him by, some socially conscious energumen is bound to sweat him with a lecture on civic duty, like the citizeness who came at me.
For 25 years my dereliction has been known to my friends, and more than one has undertaken to set me straight; out of these arguments came a solid defense for my nonvoting position, so that the lady in question was well parried with practiced retorts. I pointed out, with many instances, that though we have had candidates and platforms and parties and campaigns in abundance, we have had an equivalent plenitude of poverty and crime and war. The regularity with which the perennial promise of "good times" wound up in depression suggested the incompetence of politics in economic affairs. Maybe the good society we have been voting for lay some other way; why not try another fork in the road, the one pointing to individual self-improvement, particularly in acquiring a knowledge of economics? And so on.
There was one question put to me by my charming annoyer that I deftly sidestepped, for the day was sultry and the answer called for some mental effort. The question: "What would happen if we quit voting?"
If you are curious about the result of noneating you come upon the question of why we eat. So, the query put to me by the lady brings up the reason for voting. The theory of government by elected representatives is that these fellows are hired by the voting citizenry to take care of all matters relating to their common interests. However, it is different from ordinary employment in that the representative is not under specific orders, but is given blanket authority to do what he believes desirable for the public welfare in any and all circumstances, subject to constitutional limitations. In all matters relating to public affairs the will of the individual is transferred to the elected agent, whose responsibility is commensurate with the power thus invested in him.
It is this transference of power from voter to elected agents that is the crux of republicanism. The transference is well-nigh absolute. Even the constitutional limitations are not so in fact, since they can be circumvented by legal devices in the hands of the agents. Except for the tenuous process of impeachment, the mandate is irrevocable. For the abuse or misuse of the mandate the only recourse left to the principals, the people, is to oust the agents at the next election. But when we oust the rascals, do we not, as a matter of course, invite a new crowd? It all adds up to the fact that by voting them out of power, the people put the running of their community life into the hands of a separate group, upon whose wisdom and integrity the fate of the community rests.
All this would change if we quit voting. Such abstinence would be tantamount to this notice to politicians: since we as individuals have decided to look after our affairs, your services are no longer needed. Having assumed social power we must, as individuals, assume social responsibility – provided, of course, the politicians accept their discharge. The job of running the community would fall on each and all of us. We might hire an expert to tell us about the most improved firefighting apparatus, or a manager to look after cleaning the streets, or an engineer to build us a bridge; but the final decision, particularly in the matter of raising funds to defray costs, would rest with the townhall meeting. The hired specialists would have no authority other than that necessary for the performance of their contractual duties; coercive power, which is the essence of political authority, would be exercised, if necessary, only by the committee of the whole.
There is some warrant for the belief that a better social order would ensue when the individual is responsible for it and, therefore, responsive to its needs. He no longer has the law or the lawmakers to cover his sins of omission; need of the neighbors' good opinion will be sufficient compulsion for jury duty and no loopholes in a draft law, no recourse to "political pull" will be possible when danger to his community calls him to arms. In his private affairs, the now-sovereign individual will have to meet the dictum of the marketplace: produce or you do not eat; no law will help you. In his public behavior he must be decent or suffer the sentence of social ostracism, with no recourse to legal exoneration. From a law-abiding citizen he will be transmuted into a self-respecting man.
Would chaos result? No, there would be order, without law to disturb it.
But, let us define chaos. Is it not disharmony resulting from social friction? When we trace social friction to its source do we not find that it seminates in a feeling of unwarranted hurt, or injustice? Then chaos is a social condition in which injustice obtains. Now, when one man may take, by law, what another man has put his labor into, we have injustice of the keenest kind, for the denial of a man's right to possess and enjoy what he produces is akin to a denial of life. Yet the power to confiscate property is the first business of politics. We see how this is so in the matter of taxation; but greater by far is the amount of property confiscated by monopolies, all of which are founded in law.
While this economic basis of injustice has been lost in our adjustment to it, the resulting friction is quite evident. Most of us are poor in spite of our constant effort and known ability to produce an abundance; the incongruity is aggravated by a feeling of hopelessness. But the keenest hurt arises from the thought that the wealth we see about us is somehow ours by right of labor, but is not ours by right of law. Resentment, intensified by bewilderment, stirs up a reckless urge to do something about it. We demand justice; we have friction. We have strikes and crimes and bankruptcy and mental unbalances. And we cheat our neighbors, and each seeks for himself a legal privilege to live by another's labor. And we have war. Is this a condition of harmony or of chaos?
In the frontier days of our country there was little law, but much order, for the affairs of the community were in the hands of the citizenry. Although fiction may give an opposite impression, it is a fact that there was less per capita crime to take care of then than there is now when law pervades every turn and minute of our lives. What gave the West its wild and woolly reputation was the glamorous drama of intense community life. Everybody was keenly interested in the hanging of a cattle rustler; it was not done in the calculated quiet of a prison, with the dispatch of a mechanical system. The railriding of a violator of townhall dicta had to be the business of the town prosecutor, who was everybody.
Though the citizen's private musket was seldom used for the protection of life and property, its presence promised swift and positive justice, from which no legal chicanery offered escape, and its loud report announced the dignity of decency. Every crime was committed against the public, not the law, and therefore the public made an ado about it. Mistakes were made, to be sure, for human judgment is ever fallible; but, until the politician came, there was no deliberate malfeasance or misfeasance; until laws came, there were no violations, and the code of human decency made for order.
So, if we should quit voting for parties and candidates, we would individually reassume responsibility for our acts and, therefore, responsibility for the common good. There would be no way of dodging the verdict of the marketplace; we would take back only in proportion to our contribution. Any attempt to profit at the expense of a neighbor or the community would be quickly spotted and as quickly squelched, for everybody would recognize a threat to himself in the slightest indulgence of injustice. Since nobody would have the power to enforce monopoly conditions, none would obtain. Order would be maintained by the rules of existence, the natural laws of economics.
That is, if the politicians would permit themselves to be thus ousted from their positions of power and privilege.
I doubt it.
Remember that the proposal to quit voting is basically revolutionary; it amounts to a shifting of power from one group to another, which is the essence of revolution. As soon as the nonvoting movement got up steam, the politicians would most assuredly start a counterrevolution. Measures to enforce voting would be instituted; fines would be imposed for violations, and prison sentences would be meted out to repeaters.
It is a necessity for political power, no matter how gained, to have the moral support of public approval, and suffrage is the most efficient scheme for registering it; notice how Hitler, Mussolini, and Stalin insisted on having ballots cast. In any republican government, even ours, only a fraction of the populace votes for the successful candidate, but that fraction is quantitatively impressive; it is this appearance of overwhelming sanction that supports him in the exercise of political power. Without it he would be lost.
Propaganda, too, would bombard this passive resistance to statism; not only that put out by the politicians of all parties – the coalition would be as complete as it would be spontaneous – but also the more effective kind emanating from seemingly disinterested sources. All the monopolists, all the coupon-clipping foundations, all the tax-exempt eleemosynary institutions – in short, all the "respectables" – would join in a howling defense of the status quo.
We would be told most emphatically that unless we keep on voting away our power to responsible persons, it would be grabbed by irresponsible ones; tyranny would result.
That is probably true, seeing how since the beginning of time men have sought to acquire property without laboring for it.
The answer lies, as it always has, in the judicious use of private artillery. On this point a story, apocryphal no doubt, is worth telling. When Napoleon's conquerors were considering what to do with him, a buck-skinned American allowed that a fellow of such parts might be handy in this new country and ought to be invited to come over. As for the possibility of a Napoleonic regime being started in America, the recent revolutionist dismissed it with the remark that the musket with which he shot rabbits could also kill tyrants. There is no substitute for human dignity.
But the argument is rather specious in the light of the fact that every election is a seizure of power. The balloting system has been defined as a battle between opposing forces, each armed with proposals for the public good, for a grant of power to put these proposals into practice. As far as it goes, this definition is correct; but when the successful contestant acquires the grant of power toward what end does he use it – not theoretically but practically? Does he not, with an eye to the next campaign, and with the citizens' money, go in for purchasing support from pressure groups? Whether it is by catering to a monopoly interest whose campaign contribution is necessary to his purpose, or to a privilege-seeking labor group, or to a hungry army of unemployed or of veterans, the over-the-barrel method of seizing and maintaining political power is standard practice.
This is not, however, an indictment of our election system. It is rather a description of our adjustment to conquest. Going back to beginnings – although the process is still in vogue, as in Manchuria, or more recently in the Baltic states – when a band of freebooters developed an appetite for other people's property they went after it with vim and vigor. Repeated visitations of this nature left the victims breathless, if not lifeless, and propertyless to boot. So, as men do when they have no other choice, they made a compromise. They hired one gang of thieves to protect them from other gangs, and in time the price paid for such protection came to be known as taxation. The tax gatherers settled down in the conquered communities, possibly to make collections certain and regular, and as the years rolled on a blend of cultures and of bloods made of the two classes one nation. But the system of taxation remained after it had lost its original significance; lawyers and professors of economics, by deft circumlocution, turned tribute into "fiscal policy" and clothed it with social good.
Nevertheless, the social effect of the system was to keep the citizenry divided into two economic groups: payers and receivers. Those who lived without producing became traditionalized as "servants of the people," and thus gained ideological support. They further entrenched themselves by acquiring sub-tax-collecting allies; that is, some of their group became landowners, whose collection of rent rested on the law-enforcement powers of the ruling clique, and others were granted subsidies, tariffs, franchises, patent rights, monopoly privileges of one sort or another. This division of spoils between those who wield power and those whose privileges depend on it is succinctly described in the expression, "the state within the state."
Thus, when we trace our political system to its origin, we come to conquest. Tradition, law, and custom have obscured its true nature, but no metamorphosis has taken place; its claws and fangs are still sharp, its appetite as voracious as ever. In the light of history it is not a figure of speech to define politics as the art of seizing power; and its present purpose, as of old, is economic.
There is no doubt that men of high purpose will always give of their talents for the common welfare, with no thought of recompense other than the goodwill of the community. But so long as our taxation system remains, so long as the political means for acquiring economic goods is available, just so long will the spirit of conquest assert itself; for men always seek to satisfy their desires with the least effort. It is interesting to speculate on the kind of campaigns and the type of candidates we would have if taxation were abolished and if, also, the power to dispense privilege vanished. Who would run for office if there were "nothing in it"?
Why should a self-respecting citizen endorse an institution grounded in thievery? For that is what one does when one votes. If it be argued that we must let bygones be bygones, see what we can do toward cleaning up the institution so that it can be used for the maintenance of an orderly existence, the answer is that it cannot be done; we have been voting for one "good government" after another, and what have we got? Perhaps the silliest argument, and yet the one invariably advanced when this succession of failures is pointed out, is that "we must choose the lesser of two evils." Under what compulsion are we to make such a choice? Why not pass up both of them?
To effectuate the suggested revolution all that is necessary is to stay away from the polls. Unlike other revolutions, it calls for no organization, no violence, no war fund, no leader to sell it out. In the quiet of his conscience each citizen pledges himself, to himself, not to give moral support to an unmoral institution, and on election day he remains at home. That's all. I started my revolution 25 years ago and the country is none the worse for it.
Reprinted from Mises.org.
Frank Chodorov (1887–1966), one of the great libertarians of the Old Right, was the founder of the Intercollegiate Society of Individualists and author of such books as The Income Tax: Root of All Evil. Here he is on "Taxation Is Robbery." And here is Rothbard's obituary of Chodorov.
The Best of Frank Chodorov archives
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Coming Soon to America: Big Push for Austerity
October 26, 2010 | In These Times | ICH
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Posted by mammonmessiah at 10:27 AM
Tuesday, October 26, 2010
Wall Street Has Already Voted
by Holly Sklar article link
October 26, 2010 | CommonDreams
Before Wall Street drove our economy off a cliff, bullish Citigroup strategists dubbed the United States a "plutonomy." They said, "There are rich consumers, few in number, but disproportionate in the gigantic slice of income and consumption they take. There are the rest, the 'non-rich,' the multitudinous many, but only accounting for surprisingly small bites of the national pie."
Inequality had increased so much since the 1980s, Citi strategists noted in 2005, that the richest 1 percent of households and the bottom 60 percent had "similar slices of the income pie!" Even better, they said, "the top 1 percent of households account for 40 percent of financial net worth, more than the bottom 95 percent of households put together." And the Bush "administration's attempts to change the estate tax code and make permanent dividend tax cuts, plays directly into the hands of the plutonomy."
In "Revisiting Plutonomy: The Rich Getting Richer," Citi strategists considered the risk of backlash. "Whilst the rich are getting a greater share of the wealth ... political enfranchisement remains as was - one person, one vote," they said. "At some point it is likely that labor will fight back against the rising profit share of the rich and there will be a political backlash against the rising wealth of the rich." This could be felt, for example, "through higher taxation (on the rich or indirectly though higher corporate taxes/regulation)."
Fast forward. Wall Street wrecked the economy and was bailed out by the rest of us. "Pay on Wall Street is on pace to break a record high for a second consecutive year," the Wall Street Journal reports. Main Street, meanwhile, suffers record high foreclosures speeded by robo-signers.
Big businesses have a record amount of nearly $2 trillion in cash and are borrowing money cheap to buy other companies, buy back stock and pay out more dividends. Small businesses can't get credit to buy more equipment or hire more workers.
According to the latest IRS data, the 400 richest taxpayers increased their average income by 399 percent, adjusted for inflation, between 1992 and 2007, and lowered their effective income tax rate by 37 percent - from 26.4 percent to 16.6 percent.
This year, the Forbes 400 richest Americans, all billionaires, enjoyed an 8 percent rise in their wealth - while more than one out of eight Americans depends on food stamps.
The backlash is here, but it's lashing in the wrong direction. The anti-government Tea Party rage plays directly into the hands of the Kings of Wall Street.
Wall Street has already voted, pouring money into Republican campaigns and anti-Democratic ads by astroturf groups that don't have to disclose their Big Bank, Big Oil, Big Business donors. "Our target ratio for the 2010 cycle is 80-20 Republican," American Financial Services Association representative Karen Klugh told Politico.
Wall Street expects a good return on their investment. "Wall Street is preparing for a Republican surge in Congress that could help it block proposed taxes on banks and investments, blunt new financial regulations and regain some of the lobbying firepower it lost during the financial crisis," Bloomberg reports. "Banks would prefer to have Republicans overseeing the regulators, lobbyists said."
Wall Street wants freedom to gamble with our money - including the Social Security funds Republicans want to try again to privatize.
"The Republican agenda could also give new life to free-trade agreements with Colombia, Panama and South Korea," Bloomberg reports. That's good news for the plutocrats. As Citigroup said in 2005, "Globalization is making it easier for companies to either outsource manufacturing (source from cheap emerging markets like China and India) or 'offshore' manufacturing (move production to lower cost countries)."
Average wages are 7 percent lower today, adjusted for inflation, than they were back in 1973. Do you want to go lower?
The richest 1 percent has more wealth than the bottom 95 percent combined, but just 1 percent of the vote.
Wall Street plundered your livelihoods, homes and retirement funds - and now they want you to bail them out, again, with your vote.
They want to sell you bait-and-switch candidates like they sold you bait-and-switch mortgages. And laugh all the way to the bank.
Wall Street has voted. It's your turn.
Copyright 2010 Holly Sklar
Holly Sklar is author of "A Just Minimum Wage: Good for Workers, Business and Our Future" (www.letjusticeroll.org) and "Raise the Floor: Wages and Policies That Work for All of Us." She can be reached at hsklar.writer[at]gmail.com.
Distributed by McClatchy-Tribune News Service
The Tea Party Movement: Deluded and Inspired by Billionaires
By funding numerous rightwing organisations, the mega-rich Koch brothers have duped millions into supporting big business
October 25, 2010 | The Guardian/UK | CommonDreams | AlterNet
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Posted by mammonmessiah at 10:15 AM
French Lessons for U.S. Workers
by Shamus Cooke article link
October 26, 2010 | CommonDreams
The world watches as France once again erupts in protests, demonstrations, and strikes. So much is at stake. If France's corporate-dominated government is able to increase the retirement age, other governments will be empowered to follow through with their plans to do the same.
If labor, student, and community groups succeed in stopping the pension reform -- or toppling the government -- workers in other countries will likewise be inspired to fight back and organize in the French fashion.
The worldwide recession has encouraged business-focused governments to pursue the kind of anti-worker policies they've been discussing for years. There is common agreement among these governments on a global scale as to the necessity for these polices. Working people disagree.
There have already been massive demonstrations or general strikes in Greece, Ireland, Italy, Spain, Portugal and elsewhere. In England, massive cuts to the public sector -- 500,000 job cuts -- have been announced that could cause a similar backlash.
In the United States, President Obama has formed his Deficit Reduction Commission, which has in its sights Social Security and Medicare. The Los Angles Times reports:
"Social Security is one of several areas being eyed by the panel [deficit reduction commission] for changes...other commission targets include Medicare, defense spending and a range of tax policies..." (September 29, 2010).
Obama's commission will report its "findings" sometime after the November elections, possibly as early as December 1st. In this way, the public will have no immediate recourse to punish the House and Senate members involved in these closed-door sessions, which will open the door to massive spending cuts in social programs.
This backroom, undemocratic scheming is happening all over Europe, with incredible implications: enormous changes are happening to nations with zero input from the population; no voting is taking place over these policies, they are simply being pushed through.
But France is changing everything. French workers stopped a conservative government in 1995 from implementing a similar reform -- they are confident that they can stop this one too.
The French working class is busting a myth broadcasted from governments everywhere, that massive spending cuts are "necessary" and worse, "inevitable," no matter how unpopular (undemocratic). In France, 71 percent of the population supports the unions' opposition to raising the retirement age. And given that the inequalities in wealth have been growing for the past several decades throughout Europe and the U.S., an obvious alternative to lowering the budget deficit would be to tax the rich.
If the French workers can force "their" President and "their" Congress to back down, resign, or change nationalities, working people all over the world will be inspired to do likewise, even in the United States.
The French government has not yet backed down as workers have shut down oil refineries, railways, and government services on a broad scale. High school and university students are shutting down their schools; massive demonstrations have been held as public support for the strikes remains high, as does hate for the government.
Instead of defusing the movement, the French government's obstinacy has only radicalized it. Workers across France are calling for an indefinite general strike -- paralyzing the country -- until the government backs down, or crumbles.
If this happens, the powerlessness that workers feel in the United States and England will melt away: seeing their potential power realized in another country inevitably inspires confidence. This is one reason why the U.S. mainstream media wants the French government to push through the unpopular measures.
Labor unions in the United States need to educate their members and the community at large about the intentions of Obama's Deficit Reduction Commission as well as the Democrats in general. The same unions that are the backbone of the French movement are also very powerful in the United States: public sector workers, teachers, bus and truck drivers, dockworkers, railway workers, etc.
A solution to the U.S. deficit problem also needs to be proposed by these unions, who, like those in France, must unite in coalitions to demand that taxes be raised on the wealthy and corporations, instead of cuts in social services, pensions, and education.
After the elections the Democrats are planning to bare their teeth; working people should be sharpening their claws in preparation.
Shamus Cooke is a social service worker, trade unionist, and writer for Workers Action. He can be reached at firstname.lastname@example.org
Posted by mammonmessiah at 10:11 AM
Monday, October 25, 2010
Tea Party Inc.: The Big Money and Powerful Elites Behind the Right Wing's Latest Uprising
By Adele M. Stan article link
October 24, 2010 | AlterNet | The Investigative Fund at The Nation Institute
This article was reported in collaboration with The Investigative Fund at The Nation Institute.
Win or lose, the Tea Party movement will come away from next week's elections triumphant, having injected into the Republican Party a group of candidates pledged to the dismantling of government and wed to the religious right. Of the movement's dozen favored candidates for U.S. Senate, all are anti-abortion, and five oppose it even in cases of rape and incest. Among their number are Colorado's Ken Buck, who has compared homosexuality to alcoholism, and Nevada's Sharron Angle, who wants to demolish both the Department of Education and the Environmental Protection Agency. Major GOP players, from political strategist Karl Rove to former Bush speechwriter David Frum, have fretted publicly over Tea Party extremism, with Frum complaining of the movement's "paranoid delusions."
But it has now become clear that these Tea Party "outsiders" are all part of an inside game, a battle for control of the Republican party.
Though billed as a people's movement, the Tea Party wouldn't exist without a gusher of cash from oil billionaire David H. Koch and the vast media empire of Rupert Murdoch. Many of the small donations to Tea Party candidates have been cultivated by either Fox News Channel, a property of Murdoch's News Corporation, or the Americans for Prosperity Foundation, chaired by Koch. The movement's major organizations are all run, not by first-time, mad-as-hell activists, but by former GOP officials or operatives.
Taken together, Americans for Prosperity, FreedomWorks (another far-right political group seeded by the Kochs) and Murdoch's News Corp, owner of Fox News and the Wall Street Journal, form the corporate headquarters of a conglomerate one might call Tea Party, Inc. This is the syndicate that funds the organizing, crafts the messages, and channels the rage of conservative Americans at their falling fortunes into an oppositional force to President Obama and to any government solution to the current economic calamity. Groups such as Tea Party Express, Tea Party Nation, and the FreedomWorks-affiliated Tea Party Patriots; the bevy of political consultants for hire; and various allied elected officials can be understood as Tea Party, Inc.'s loosely affiliated subsidiaries. The Web sites of FreedomWorks, Americans for Prosperity and the Tea Party side projects of Fox News Channel's Glenn Beck are linked with those of Tea Party Express and Tea Party Patriots, all of which in turn solicit support for Tea Party candidates.
The armies of angry white people with their "Don't Tread on Me" flags, the actual grassroots activists, are not the agents of the Tea Party revolt, but its end users, enriching the Tea Party's corporate owners just as you and I enrich Google through our clicks.
Coming Out Party
Tea Party, Inc. was on full display in our nation's capital in late August, when Glenn Beck gathered his angry white multitudes at the Lincoln Memorial on the anniversary of Martin Luther King's historic "I Have a Dream" speech. The tens of thousands of Tea Partiers who showed up for this political revival were mobilized by untold hours of free promotion on Murdoch's network, while a related "Take America Back" convention, held the day before at Constitution Hall, was convened by FreedomWorks.
At that event, the crowd was treated to a trailer for a forthcoming film called Runaway Slave, narrated by Rev. C.L. Bryant, an African-American pastor from Louisiana identified as "a former NAACP radical," who made the case that liberalism is yet another means of enslaving black people.
"[I]n the black community," Bryant says in the film, "there's always somebody who's gotta keep them niggers in control." A photo of Jesse Jackson flashed on the screen. Then one of Al Sharpton. Some images flashed by so quickly that they were barely discernable. One was of a wriggling maggot.
Before the night was out, Glenn Beck himself graced the stage, asking the crowd to "expect miracles" at the next day's rally.
A few miles away, a more sedate crowd was jammed into a Marriott ballroom for a gala dinner that wrapped up yet another activist conference, the Defending the American Dream Summit, this one convened by the Americans for Prosperity Foundation. Striding toward the podium to the opening strains of "New York, New York" was chairman Koch. Tall and dapper in a precisely tailored dark suit, the 70-year-old stood in sharp contrast to the 2,500 middle-class women in pastel frocks and men in department-store sport coats who populated the ballroom tables.
Koch prefers to be known for the hundreds of millions he lavishes on his adopted city's cultural institutions -- the New York City Ballet, the Metropolitan Museum of Art, and the Metropolitan Opera, to name a few. But the quieter largess behind events like these, dispensed by David Koch and his brother Charles, has reshaped Washington, D.C., and our national politics. Though Americans for Prosperity, which he founded, and its foundation, whose board he chairs, have been instrumental in organizing the Tea Party movement, Koch still publicly claims to have no Tea Party ties, making tonight's appearance notable.
"Six years ago, when we launched this organization," he said in his uneasy and halting style, "we envisioned a grassroots organization of Americans from all walks of life banded together to advance economic freedom and prosperity by limiting government's reach, and curbing government's growth, reining in government spending. …We envisioned an organization that would boldly and unapologetically defend the free-market economy. The Tea Party is Koch's dream come true; the Washington summit, he told attendees, was designed to train grassroots activists in the defense of the "free-market economy" and "to send a message to the political class that these activists [are] energized and watching" its members.
The Capitol Hill Franchise
The self-appointed head of Tea Party, Inc.'s Capitol Hill division is the junior senator from South Carolina, Jim DeMint. DeMint is the top Senate recipient of donations from the Koch Industries' PAC, reeling in $22,000 in the current election cycle for a race he stands virtually no chance of losing. The Kochs' PAC is also the number three donor to DeMint's PAC, the Senate Conservatives Fund, which he spends on other races.
In DeMint, the Kochs found a politician who will make no compromises on their far-right agenda, favoring tax cuts and opposing health-care reform, green energy, labor unions and regulation of any kind. Last year, DeMint received the Americans for Prosperity Foundation's George Washington Award, bestowed upon the senator by Koch himself. Speaking at the organization's summit in August, Koch said DeMint "has consistently stood for freedom against this big-government agenda." In backing DeMint's power play against leaders of the Republican establishment, particularly his challenge to the power of Senate Minority Leader Mitch McConnell, the Kochs stand poised to push those establishment leaders into the same uncompromising positions.
Echoing DeMint's agenda are Rep. Michele Bachmann, a Minnesota Republican who, in July, founded a Tea Party Caucus in the House of Representatives, and Rep. Mike Pence, a Republican from Indiana, who is House GOP conference chairman and a charter member of the new caucus. Both are Tea Party favorites, and Bachmann is a regular speaker at Americans for Prosperity events. At the Americans for Prosperity Foundation's RightOnline conference, held in Las Vegas in July, Pence used a luncheon address to make the case for melding the free-market Tea Party agenda with the values of the religious right, while Bachmann entertained a banquet crowd with herplan to phase out Social Security.
FreedomWorks has its eye on a political transformation in the Senate, and is closely allied with DeMint, whose PAC is spending hundreds of thousands of dollars on behalf of many of the same Tea Party-backed Senate candidates endorsed by the FreedomWorks PAC, including Sharron Angle (currently in a tight race against Senate Majority Leader Harry Reid), Rand Paul in Kentucky, Marco Rubio in Florida, and Utah's Mike Lee. (Bachmann's Tea Party Caucus was announced the day after Paul, addressing FreedomWorks activists on a July 13 conference call, suggested a Tea Party caucus for the Senate.) Each of these candidacies began as primary challenges to establishment Republicans endorsed by McConnell.
In September, Huffington Post political columnist Sam Stein cited a Democratic strategist who said that by the midterms' close, Americans for Prosperity will have spent $45 million on organizing "voter education" and get-out-the-vote activities that test the limits of legal nonprofit expenditures. Actually, Americans for Prosperity president Tim Phillips told me his plan was to raise and spend even more, though he wouldn't name a figure. Even the lesser amount, according to tax filings, would represent a tripling of its funds since 2008.
FreedomWorks also hopes to triple its revenue, from $3 million in 2008, according to tax filings, to an anticipated $10 million this election cycle, according to Adam Brandon, the group's communications director. In a fundraising video sent by FreedomWorks to new members, leaders announce that every dollar raised will be matched by an unnamed donor. Both Brandon and Koch Industries spokesperson Melissa Cohlmia say that FreedomWorks has received no funding from the Kochs or their foundations since 2004, so there is likely another high-roller involved. But neither FreedomWorks nor Americans for Prosperity,nor its foundation, is required by law to disclose its donors and -- like advocacy organizations across the political spectrum -- they don't.
At any rate, the vast expenditures on organizing have worked in at least one way: FreedomWorks' membership had reached nearly 1.1 million by mid-October, according to the group's Web site ticker. Americans for Prosperity claims 1.5 million members and chapters in 31 states.
Both groups excel at training activists and spreading the word for Tea Party candidates, who have raked in a significant portion of their campaign donations from small donors, according to the Center for Responsive Politics. When Angle's campaign announced earlier this month that it had raised a whopping $14 million since June, spokesperson Jarrod Agen told the Washington Post that 96 percent of those donations were $200 or less. (At press time, neither Angle nor the FEC had released official filings.)
One “voter education” exercise I witnessed was the dispatch of participants in July’s RightOnline conference to canvass the Las Vegas suburbs, armed with a script about Harry Reid. “Reid voted for the failed $800 billion stimulus plan that has wasted our tax dollars on more government,” it read. “Reid’s policies will make government bigger, waste more money, drive up budget deficits and kill jobs.”
The canvassers had just heard Angle, Reid’s opponent, deliver the conference’s closing speech. But as they boarded vans for their deployments, they were reminded this was, of course, a nonpartisan exercise — since the Americans for Prosperity Foundation, a nonprofit, is forbidden from endorsing candidates.
The Money Men
The Tea Party’s two major patrons are fabulously wealthy. David Koch is heir to the fortunes of Koch Industries, described in 2008 by Fortune as the largest privately held corporation in the United States, and was ranked by Forbes as one of the world's richest people, with an estimated personal wealth of $17.5 billion. Rupert Murdoch, founder and CEO of News Corp -- ranked by Fortune as world's second-largest entertainment company -- was also rated by Forbes among the world's wealthiest, with personal wealth of $6.3 billion.
Koch Industries, with David as executive vice-president and his brother Charles as CEO, presides over a vast conglomerate of oil and gas interests, as well as holdings in timber and chemicals. Since the 1970s, the two men have funded and controlled a large network of right-wing institutions, launching the libertarian Cato Institute in 1977 and the Mercatus Institute in 1985, all of which advocate business deregulation under the rubric of "free markets."
Both cornerstones of Tea Party Inc. -- FreedomWorks and the two entities comprising Americans for Prosperity -- sprang from Koch's riches. FreedomWorks rose from the ashes of Citizens for a Sound Economy, an early Astroturf group and think tank he founded during the Reagan years to advocate for lower taxes, less regulation, and smaller government. CSE was rebranded as FreedomWorks in 2004, after a corporate-style merger with Empower America, founded by the late Republican Congressman Jack Kemp to limit government and privatize government services.
That same year, Koch rebranded CSE's foundation as the Americans for Prosperity Foundation and founded its sibling organization, Americans for Prosperity.[i] Koch hired the politically connected Tim Phillips to serve as president of both organizations. (Phillips is a business partner of former Christian Coalition director Ralph Reed in a political consulting firm, Century Strategies, which was implicated, but never charged, in the bribery scandal that sent Jack Abramoff to prison.)
Koch and his allies built the underpinnings for a movement not quite ready to be born. The absent ingredient was rage. But by 2009, with the collapse of the economy and the election of the nation's first African-American president, the supply chain of rage was complete, and the Tea Party came roaring to life. Rupert Murdoch gave the new movement legitimacy by means of sympathetic columns in the Wall Street Journal, boosterism from Sean Hannity and Glenn Beck and a regular media platform on Fox News Channel for Tea Party personalities and candidates. As Jane Mayer remarked in her New Yorker profile of the Kochs, the Tea Party had at last turned their private agenda into a mass movement.
The role of these groups in launching the movement is indisputable. In concert with Glenn Beck's 912 Project, FreedomWorks did the logistical organizing for the first Tea Party march on Washington, in September 2009. Beck launched the 912 Project on his Fox News Channel show, promoted the march on his show and mobilized for it through a social networking Web site built by his production company.
Since then, the groups have been tearing through the Murdoch-Koch agenda. Americans for Prosperity says it convened, through an offshoot, some 300 rallies against health-care reform, and once the healthcare bill was passed in March, the organization quickly moved to block cap-and-trade as a means of regulating carbon emissions. In fact, at an Americans for Prosperity Foundation conference I attended in Pittsburgh in August 2009, cap-and-trade was already being introduced as the next Tea Party battle. This is a longstanding priority for Koch Industries, a major polluter heavily invested in old energy technologies. In a March 2010 report, Greenpeace said that, over the years, the Koch brothers have "quietly funneled" nearly $50 million to "climate-denial front groups that are working to delay policies and regulations aimed at stopping global warming."
Wall Street Journal columnist Stephen Moore -- a member of the newspaper's editorial board and a former fellow at the Koch-funded Cato Institute -- told the gathering of Tea Party activists he thought global warming was "the greatest hoax of the last 100 years." He called the climate change agenda "not just evil, but…contrary to the free-market system that made this country great."
The Media Storm
It is not unusual for op-ed pages to reflect the bias of an outlet's owners. It is highly unusual, however, for news operations to engage in outright political organizing on behalf of a CEO's agenda. Yet that's just what certain Fox News hosts and Wall Street Journal columnists seem to be doing on behalf of Rupert Murdoch, who is opposed to regulation of any kind, hates taxes, and despises labor unions -- having famously broken unions at his UK newspapers.
News Corp's best-known personalities accomplish this by working hand in glove with the like-minded ideologues at Americans for Prosperity. Fox News hosts, along with Stephen Moore and fellow Wall Street Journal columnist John Fund, are regular speakers at conferences sponsored by the Americans for Prosperity Foundation. At the group's 2009 RightOnline conference, a third of the plenary speakers were News Corp writers and pundits, including Moore and Fund, as well as Jim Pinkerton and Michelle Malkin, who were paid Fox commentators at the time. Fox News personality John Stossel spoke against health-care reform at three rallies sponsored by Americans for Prosperity, while Sean Hannity, host of a prime-time Fox News show, live-broadcast Americans for Prosperity's 2009 Tax Day protest in Atlanta -- and the network preempted regular programming to present it. Moore and Fund also shill for the foundation's anti-regulatory "worker education" project, known as Prosperity101.
The door swings the other way as well. By means of his regular presence on Fox's airwaves and column at the FoxNation Web site, Americans for Prosperity vice president Phil Kerpen was instrumental in building the case against Obama green jobs adviser Van Jones, who was ultimately forced to resign his White House post.
At last year's RightOnline conference, I asked Americans for Prosperity president Tim Phillips if his group worked in partnership with News Corp, given the presence of so many of its personalities on the roster.
"Not at all, not at all," he replied with a laugh. "The fact is, the Wall Street Journal's my favorite newspaper; I love those guys. I like what they write. I look at Steve Moore and John Fund, and those are two of the smartest guys. But there's no partnership -- financially, understood, or anything else."
News Corp enjoys a similarly friendly -- if similarly informal -- relationship with FreedomWorks. In early October, FreedomWorks was promoting its Take America Back campaign -- a get-out-the-vote effort -- with a photo of Glenn Beck standing before his iconic blackboard. The FreedomWorks' Web site also featured an audio message from Beck: "I've been sayin' it for weeks. If you care about freedom, you must get involved. If you really want to end tyranny in Washington, you must get involved. And the group you need to find out about is FreedomWorks. … Take America back -- FreedomWorks.org." Just days ago, Beck's image was used in a splash screen to solicit contributions for FreedomWorks' PAC.
To Rupert Murdoch, Glenn Beck is much more than a broadcaster; he's Murdoch's lead community organizer. His show has leached revenue since the civil rights group Color of Change launched a boycott of his advertisers, reportedly chasing away at least 100. But his act is far more profitable to News Corp in another way -- by creating the conditions for a stripping away of federal regulations that limit the growth of News Corp and its bottom line. And so Beck's rants become more shrill and his claims more preposterous, whether he is stoking racial fears or recalling that old bogeyman threat of looming socialism -- a theme straight out of the John Birch Society, of which the Kochs' father, Fred, was a founding member.
In Washington, D.C., Adam Brandon, FreedomWorks' communications director, is bubbling over with excitement at the end of a long, hot July day. "I'm racking up the frequent flyer miles," he says of his relentless weekend trips to train Tea Party activists in how to chalk up wins for candidates FreedomWorks' PAC has endorsed.
FreedomWorks doesn't aim to elect just any Tea Party candidate to office: as with DeMint's Senate Conservatives Fund, its endorsements seem designed to undermine the current GOP establishment, push the party rightward and further an anti-regulatory agenda. Well before others joined in, FreedomWorks embraced far-right insurgencies, notably those of Marco Rubio and Rand Paul. Both endorsements put FreedomWorks at loggerheads with Sen. McConnell, whose candidates -- including his hand-picked protégé in his home state of Kentucky -- were vanquished.
DeMint's PAC spends hefty amounts on behalf of its endorsed candidates, including $447,000 for Rubio and $95,000 for Paul ($95,000). FreedomWorks matches DeMint's cash with ground forces. The PAC runs an online "service center," where, according to FreedomWorks president Matt Kibbe, Tea Partiers "get the tools they need to turn a protest into a sophisticated, turn-out-the-vote effort." Those tools include walking maps, door-hangers, talking points, and "a sophisticated phone-banking system that is going to allow you to make calls in all of our targeted races." If you're an activist in Wisconsin, FreedomWorks can set you up to turn out voters for Rand Paul in Kentucky. Combined, these Tea Party outfits have proven that they have the potential to decide elections.
When I asked whether FreedomWorks' endorsements were chosen in part to undermine McConnell, Brandon declined to answer directly, but his response revealed the intimate ties between his outfit and DeMint's. DeMint has been stalwart on behalf of FreedomWorks' positions, Brandon explained. These include opposition to healthcare and energy reform and labor unions. But DeMint needs more people like him in the Senate in order to create something of a caucus -- "a new power center," Brandon called it.
Their combined might was recently on display in Utah, where DeMint and FreedomWorks joined forces to replace incumbent Republican Senator Bob Bennett. DeMint's PAC and FreedomWorks' PAC each rank among the top twelve donors to Bennett's challenger, Tea Partier Mike Lee.
In Utah, candidates must win delegates at their state party convention; primaries take place only if a run-off is needed. So FreedomWorks helped pack the convention with Tea Party-allied delegates, and Lee showed convention-goers a video endorsement by DeMint. Bennett lost his seat that day, coming in third with 26 percent of the vote. (The remainder was split between Lee and another Tea Party candidate.) Lee prevailed in the subsequent two-way primary, with more help from DeMint's PAC, which has spent $315,000on his behalf, including $184,000 in so-called "independent expenditures," according to FEC filings.
Suppliers and Subsidiaries
While Americans for Prosperity, FreedomWorks and News Corp run the boardroom of Tea Party, Inc., a growing number of national organizations have sprung up to provide a range of services; call them the suppliers. Some have similar names -- Tea Party Patriots, Tea Party Nation, Tea Party Express -- though they compete ferociously. Reed's Faith & Freedom Coalition provides a unique service to Tea Party Inc.: the promise of delivering religious-right voters to its candidates. Like the big players, these groups, too, are run by former Republican officials or political consultants.
Tea Party Patriots, perhaps the most substantial of these groups, was born of FreedomWorks, as co-founder Jenny Beth Martin points out in a FreedomWorks video, and its state chapters do the on-the-ground organizing for FreedomWorks' agenda. Martin, a former Republican political consultant in Georgia, coordinates the group with Mark Meckler, a Northern California attorney who previously ran an online political consultancy with GOP ties.
More flamboyant is Tea Party Express, another name for Our Country Deserves Better, an anti-Obama PAC founded by Howard Kaloogian, the California attorney who orchestrated the recall of Gov. Gray Davis. The group has already weathered controversy -- its spokesperson, radio talk-show host Mark Williams, was forced to exit the organization in July after authoring a demeaning satire of NAACP president Ben Jealous. But Tea Party Express has nevertheless raised $6.6 million this election, according to recent FEC data, making it, in the estimation of the New York Times, "the single biggest independent supporter of Tea Party candidates." And the group has racked up primary victories for Tea Party insurgencies such as Christine O'Donnell in Delaware, who benefitted from $250,000 in Tea Party Express ad buys; Joe Miller in Alaska, who beat incumbent Lisa Murkowski with the aid of $550,000 from the group; and Angle, who has enjoyed nearly $1 million in "independent expenditure" advertising by the group, according to FEC filings.
"Sharron Angle, in my opinion, wouldn't have won [the Republican primary] without the Tea Party Express," California Republican consultant and Tea Party organizer Eric Odom told participants in this year's RightOnline conference.
Reed's Faith & Freedom Coalition, which seeks to unite the Tea Party and the religious right, is provides a unique service to Tea Party Inc.: delivery of religious-right voters to its candidates. On September 11, Reed brought together a few hundred activists for a strategy briefing at Washington, D.C.'s Mayflower Hotel. The event featured speakers from the GOP's glory days, from Karl Rove to Newt Gingrich.There Reed instructed activists on how to "move the needle" when the polls are against you.
"We're building databases of faith-based and fiscal conservatives in every key congressional race, U.S. Senate race or governor's race, and a lot of targeted state legislative races," Reed explained. "Those voters are going to be contacted an average of seven times.We're gonna mail ‘em, we're gonna phone ‘em, if we have an e-mail, we're gonna e-mail ‘em, if we have a cell phone number, we're gonna text-message them.And at the end, we're gonna knock on their door."
Reed's big announcement of his new Faith & Freedom Coalition took place in August 2009, at an Atlanta rally against health-care reform convened by Americans for Prosperity, the organization fronted by his old business partner, Tim Phillips. FreedomWorks chairman Dick Armey delivered the keynote address, and Fox News contributor Herman Cain made the business case against health-care reform.
Phillips couldn't make it to Atlanta that day. He was stuck in Pittsburgh, at his RightOnline conference, rubbing elbows with the stars of Rupert Murdoch's News Corp.
Adele M. Stan is AlterNet's Washington bureau chief.
Click here for an Illustrated Guide to Tea Party, Inc.
For more of AlterNet's reporting on the Tea Party movement, check out our new anthology, Dangerous Brew: Exposing the Tea Party's Agenda to Take Over America, edited by Don Hazen and Adele M. Stan.
© 2010 AlterNet/The Investigative Fund at The Nation Institute All rights reserved.
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