Sunday, October 4, 2015

Video: Death-chanting Israeli mob rejoices as Palestinian teen is executed

From The Electronic Intifada

Ali Abunimah Rights and Accountability 4 October 2015

This article contains graphic images of violence

Amid increasing violence in occupied Jerusalem and the rest of the West Bank, Israeli forces executed a Palestinian youth in cold blood early on Sunday morning.

Israeli forces have declared that the Old City of Jerusalem will be open only to Jews and foreign tourists for the next 48 hours. No Palestinians except residents will be allowed in.

In a further escalation, Naftali Bennett, the Israeli education minister who openly boasts about how many Arabs he has killed, announced he plans to spend Sunday night’s Jewish holiday of Simhat Torah in the Old City.

Bennett heads the Habeyit Hayehudi (Jewish Home) party whose senior member, Justice Minister Ayelet Shaked, has openly called for genocide of Palestinians.


Right: Fadi Samir Alloun in an undated image posted on Facebook.

 Israeli authorities claimed that 19-year-old Fadi Samir Alloun was killed while attempting to carry out a stabbing attack.

But videos posted online show that the youth was executed in cold blood as he was chased by a mob of Israeli Jews baying for his blood.

As the video above begins, voices can be heard in Hebrew shouting – apparently at police – “Shoot him! He’s a terrorist! Shoot him!” and “Don’t wait! Shoot him!”

Alloun can be seen backing away from the mob, along the tracks of the Jerusalem Light Rail.

The lights of a police car can then be seen and the sound of seven gunshots heard. Alloun falls to the ground. At no time in the video was he any threat to anyone.

Wattan TV says the killing occurred in the Musrara area, just outside the walls of the Old City, near the Damascus Gate.

Kill first, ask questions later
A police officer – apparently the shooter – can be seen approaching Alloun. Meanwhile celebratory voices are heard shouting “Yes! Yes! Son of a bitch!” and “Wow!” and “He’s an Arab!” “

Death to the Arabs!” others shout.

A police officer then asks, “Where are the injured?” This suggests that the police shot first and only asked questions afterwards. It was a cold-blooded execution at the behest of a lynch mob.

 This is confirmed by this second video of the same incident published by Alkhaleej Online.

It shows the mob clearly inciting for Alloun to be killed as they chase him. The Palestinian youth is trying to escape.

After police shoot him dead, an officer can be heard asking one of the mob, “Did he stab anyone?”

The Israeli youth answers that Alloun did not.

The execution of Alloun comes as Israel escalates its violent attacks on Palestinians in the wake of recent killings of settlers in Jerusalem and the rest of the West Bank.

On Thursday, two settlers were killed in a drive-by shooting in the occupied West Bank.

On Saturday, 19-year-old Palestinian Muhannad Halabi fatally stabbed two Israelis in the Old City of Jerusalem. Nehamia Lavi, 41, was a rabbi in the Israeli army and Aaron Benita, 21, was a combat soldier. Lavi lived in occupied East Jerusalem and Bennett in the West Bank settlement of Beitar Illit.

Palestinian and Israeli media have reported a sharp escalation in attacks on Palestinians and their property across the West Bank by Israeli occupation forces and settlers in recent days.

The Palestine Red Crescent Society declared a “state of emergency” on Sunday throughout the West Bank following the upsurge of attacks by Israeli soldiers and settlers.

The society said it had faced 14 attacks against its medical staff and ambulances over the past 72 hours.

In Burin village, in the northern West Bank, Palestinians had to defend their homes after Israeli settlers set fire to trees and plants in the village and threw stones and bottles at residents, Ma’an News Agency reported.

Saturday, October 3, 2015

Buffet, Burger King and Floyd Mayweather

By Richard Mellor
Afscme Local 444, retired

We all know of Burger King. It’s one of those fast food joints that people who can afford it don’t eat at. However, millions of poor and low waged people do, and Burger King pays very low wages.

A cashier at this place would earn $8.27 an hour. A Crew Member earns $8.11 and hour. A Team Member earns $8.18 an hour although what the difference is between a crew and a team this writer does not know. Then we get to the higher ups. A shift manager, a very important position as you get your ass reamed if things don’t work our right, earns $9.87 an hour.

Now Burger King has had a few owners. These owners are called holding companies or sometimes, capital management companies.  As of today, Burger King is owned by Restaurant Brands International which is a joint US Canadian Company formed by the merger of the old Burger King and the Canadian food chain Tim Hortons.  The pervious majority owner of Burger King was 3G capital and 3G capital is now a majority owner of, yes you guessed it, Restaurant Brands International. 3G Capital is a Brazilian investment management firm co-founded founded by Alex Behring who is also a managing partner. He is also chairman of Restaurant Brands International, a director of Anheuser-Busch InBev, and chairman of Kraft Heinz Company.

I was joking of course, how could we guess any of this?

Restaurant Brands International--------Burger King plus Tim Hortons--------has its headquarters in Canada because it saves a lot of money taxes wise. The corporate Tax rate in the US is 39.1% compared to 26% in Canada.

Two of the largest shareholders in Restaurant Brands International are Bill Ackman and Warren Buffet.  Warren Buffet of course is well known and is worth $61.2 billion according to Forbes. Bill Ackman is poor by comparison and is worth a paltry $2.6bn. Ackman, bless his little heart, is founder of Pershing Square Capital Management.

Phew, it appears borders are not a problem when it comes to capital flow.

So, having settled who owns Burger King, we did settle it didn’t we?  I noticed that the company pulled a sneaky one on its competitors.  We all know how expensive TV ads are during major sporting events, millions of dollars for 30 seconds.  But Burger King got round advertising fees. Bloomberg Business Week points out in this weeks edition that Burger King, or Restaurant Brands International, or 3G Capital paid (help!) likely paid Floyd Mayweather $1,000,000, that’s one million dollars, to have the Burger King logo behind him as he walked out in the MGM Arena for his fight with Manny Pacquiao.

And this is not the first time the geniuses at Burger King have paid for a stunt like that avoiding multi-million dollar advertising slots.  At the Belmont Stakes, a month or so later BW reports, the Burger King mascot “popped up….in the private box of trainer Bob Baffert.”  Racing fans will know that Baffert is the trainer of Triple Crown winner American Pharoah.  Not as many watched that event so I guess B King figured they could get an even better deal than. Baffert was paid $200,000 which he gave to charity apparently.

Shoukat Dhanani is very happy about this because he is the head of Houston Foods that owns approximately 460 Burger King restaurants. He just loves to feed people. That’s increased somewhat over the past year as his Houston Foods bought 260 Burger King’s off of Blackstone Group. Blackstone is the famous private equity group that was co-founded by Stephen A. Schwarzman who is worth about $13 billion He earned (well he made)  over $600 million last year.  He founded Blackstone with Pete Petersen, a former US government  Secretary of Commerce. All these guys are described as “self made” by Forbes.

So now we have figured out who owns Burger King I think its important to consider that this is a very important industry, it is the food industry. Food is very important to human beings and the men, they’re almost always men, here are very concerned about our health and put a lot of time in to providing society with a quick healthy food supply.

But honestly, I am a socialist. I do not believe the dominant industries in a society should be owned by individuals or a group of individuals. I do not believe the market, their precious market, can provide proper food, housing, education, transportation, health care, productive work, or a safe and healthy natural environment in other words, basic social needs, for the vast majority of the people in the US and the world. What we describe here is savagery. It is not civilization.  We have to stop it. 

We do not have the right to do anything we want in any civilized society. I believe we have to deny the people I describe here, and their class colleagues, of the right to do what they are doing, owning and controlling the very lifeblood of society for personal gain. Their food is rotten anyway, go eat at a mom and pop and see how much better the food is. They have a right to a healthy and productive life interacting with nature to provide what humanity needs. A prerequisite for them earning their billions is paying human beings less than $10 an hour. Here in California, $20 an hour is close to poverty wages. Their existence as social parasites, accumulating obscene wealth at the expense of humanity and nature is a right I am not ashamed to say I want to deny them.

So if you’re in Burger King and have a problem with your burger they’ve set it up so  you’ll have to talk to the shift manager, you know, the guy that get’s paid $9.87 an hour for his efforts. So give him or her a break.

Friday, October 2, 2015

VW Nightmare Continues

By Richard Mellor
Afscme Local 444, retired

It’s hard to tell exactly where the crisis with Germany’s largest auto manufacturer will end up but one thing is certain, it is an immense problem.

I commented on this earlier
and what we do know is that the affects are rippling through the global marketplace and we are less than one week away form the October 7th deadline that Germany’s motor authority has given VW to come up with a technological solution to the problem.

Adding fuel to the fire, the German newspaper Bild am Sonntag reported earlier this week that the German auto parts supplier Robert Bosch that apparently delivered the infamous software to the company-----for test purposes-----warned that its use would be illegal. According to the media, it did this in writing. If this is the case, it deepens the hole VW has to climb out of.

The bad news keeps coming. It also turns out that the European emissions testing procedures are a little suspect to say the least; “…car makers pay the very firms that test and certify their vehicles” the Wall Street Journal reported yesterday. (10-13-15). The vehicles the automakers send for testing are “stripped down prototypes”.  Car companies “never submitted random vehicles drawn from the assembly lines for testing,” the Journal adds.
The whole testing procedure is corrupt of course. “A car maker is free to choose who does the test, and the testing houses are commercial companies who rely on the car makers.” says Jos Dings, the head of a Brussels based environmental group. “There is no incentive to be tough on car makers.”

The fallout goes beyond the assembly line. Most of these auto companies have what they call finance arms, by that they mean moneylending outfits. These are used to boost their sales by providing loans to buyers. VW’s financing outfit (VW Financial Services) generated 14% of the company’s first half net profit in 2015 holding 12.6 million contracts, 15% of them in North America and 70% in Europe. The Finance arm has already announced a hiring freeze for the rest of the year and VW has also cut one shift per week at its Salzgitter factory, ironically added to meet high demand.

As I pointed out last week, the company lost about a third of its value and

credit ratings companies are not touting good news which means VW’s borrowing costs could increase as well.  What’s more, the clean efficient German diesel, an engine primarily used in bigger vehicles like trucks but made popular for autos by German engineering, accounts for more than 50% of passenger autos in Europe so far this year but has now become suspect and it is quite possible there will be a shift from diesel in the future.

That a global giant like VW, despite the reputation, would cheat on emission tests should come as no surprise to anyone.  Nor should it that the relationship between the manufacturers and the testers is as cozy as it is without resulting in such criminal activity. We are used to it here in the US where politicians who receive hundreds of millions from corporate lobbyists tell us that there’s no conflict of interest, that it “doesn’t  affect my decisions”. Or the doctors that receive money form big Pharma and spin the same tale. No one believes them. People cynically accept it, for now.

I pointed out with regard to the BP spill in the Gulf of Mexico
, a catastrophe indeed, that the US government regulators allowed the energy industry to write their own rules for deep water drilling. Apart form the environmental catastrophe this episode brought us, it led to the deaths of 11 workers.  The West Texas disaster, the numerous chemical disasters and chemical spill disasters like the one in West Virginia were all market driven.

It is important to note in this instance that the European Union has rules for emission tests but does not have the means or an authority like the US EPA to, as the WSJ puts it, “…perform spot checks that can catch abuse.”   VW, has put some $7 billion aside in the immediate aftermath of the scandal but monetary amounts as high as $18 billion have been tossed around when EPA fines and class actions suits against VW by buyers are included.

The EPA is the arch-enemy of the champions of the free market. Some backward right wing workers, fooled by the media spin-doctors even consider it a communistic parasite in the belly of the beast.  Despite the EPA’s weakness and its inevitable failure to protect our environment from the ravages of capitalism, we’d be worse off without it.

The VW crisis stresses the fact that we live in a world economy and a world market. Even though the majority of the autos concerned here are in Europe the crisis in a major global corporation extends far beyond steel and rubber in to the stock exchanges of the world, the financial activity of nations and the pockets and homes of working people.

The fact that the origins of this investigation arose in the US has not been ignored by some Germans and German politicians who are hinting that it is no accident that one of the US auto manufacturing’s greatest global rivals is taking such a huge hit.

I cannot see the German or global bourgeois not ensuring that VW recovers from this crisis. There is too much at stake, money and in particular jobs. Social unrest must be averted, jobs must be preserved, especially German jobs. The cozy relationship German capitalism has with the trade union leadership at IG Metal must remain.

This is yet another turn in the crisis ridden global capitalist system. We are witnessing the slow decline of the Chinese economy. The never ending brutal regional wars and complete savagery of the life in the Middle East brought about by US foreign policy. The ongoing environmental degradation, the shutting down of the US stock exchange in the recent past due, according to reports some technical malfunction. It’s non -stop.

And we witness daily the mass slaughter here in the US. Alienated youth consumed with despair, devoid of identity and purpose and bombarded with propaganda that encourages never ending consumption turning everything including our bodies and the air we breathe in to a commodity for sale, finding purpose in destroying the lives of others along with   their own, all for some notoriety, some recognition even in death.

All these crises are connected. As for something as mundane as auto production, or what is actually, the production of mass transit, a poor and inefficient form of mass transit, the only way what we are witnessing at VW can be prevented is though public ownership of these important aspects of social production.

In the UK the recently elected leader of the Labor Party has called for the re-nationalization of the railways, a major aspect of public transportation.  This is a positive step, but it is only a half step. It is public ownership within the framework of a capitalist economy and political structure. Capital and the levers of power is still in private hands.

The workers at VW or any other corporation, as aspects of production or as consumers, do not own, mange or control the workplace, what we produce, when and how we produce it.

Through workplace committees, community committees organized structures in different regions and areas, linked nation to nation workers can run society, can govern and produce the necessities of life based on social need as opposed to profits for the minority of faceless individuals that presently own and control the forces of production.

This is not utopia, it’s the only way to a humane future, or more accurately, any future at all----a world federation of democratic socialist states.

Note: VW has set up a website for owners of affected vehicles, people like this writer.

USA: Sick society, extreme alienation, easy access to guns = mass killings.

Sean O'Torain.
A sick society with its extreme alienation, easy access to weapons equals the mass killings.  

Yes the US  is mad with its easy access to guns. Driven into this insanity by the influence of the profit addicted gun industry and its snake the NRA. This is all about profit. This is what drives the NRA. This outfit has to be taken on.

There has to be back ground checks of a strict character, maybe even limiting one gun per person or maybe even banning automatic weapons. But not banning all guns as this would leave the capitalist state with the monopoly. 

Of course it is not all about guns. It is also about a very sick society. In Switzerland I think if I am right, has everybody have a gun. Canada has lots of guns. But there is nothing like the slaughter there that there is here. Of course guns are a factor as we saw when Australia took some measures to restrict guns and this reduced the killings. But we are also talking here about a very sick society. One that has so many people in extreme alienation and despair and without any identity and with such easy access to weapons, it is this combination that leads to the slaughters. 

The capitalist press is always on about the danger of IS jihadists getting over here and killing Americans. It does not seem they need these. It is Americans killing Americans we see every day. Apparently if you take a mass killing as four or more this is called a mass killing. There has been one of these every single week for the past few years. Imagine what would be going on if IS jihadists were killing so many people and on so many occasions.

Then there is the whining of the capitalist politicians. They are the ones that take the money off the NRA and provide the guns. Then there are the ones who make speeches about how their heart goes out etc. But none of them are prepared to take on the NRA and the profit addicted gun industry. I see Obama said people should elect politicians to change things. Well they elected him and what did he do? Or what did any of the capitalist politicians they elected to Congress do?

It is blame the people again time. We live in a sick profit addicted capitalist society where so many people are alienated and just about all have access to guns. This is the problem. Ending the gun violence means ending this sick society.

Thursday, October 1, 2015

Suharto’s Purge, Indonesia’s Silence

We reprint this piece from the New York Times opinion page.  The piece refers to the US role in the genocidal slaughter in Indonesia including through its extensive intelligence apparatus, handing over details about dissenters to the regime. It did the same favor in Iraq, helping Saddam Hussein eliminate his opposition. If the reader hasn't done so already, Christopher Hitchens' book, The Trial of Henry Kissinger details numerous instances that reveal the criminal nature of US foreign policy.  Kissinger, a revered US statesman as far as the US ruling class is concerned is a mass murderer and war criminal.   Admin.

Suharto’s Purge, Indonesia’s Silence

This week marks the 50th anniversary of the beginning of a mass slaughter in Indonesia. With American support, more than 500,000 people were murdered by the Indonesian Army and its civilian death squads. At least 750,000 more were tortured and sent to concentration camps, many for decades.

The victims were accused of being “communists,” an umbrella that included not only members of the legally registered Communist Party, but all likely opponents of Suharto’s new military regime — from union members and women’s rights activists to teachers and the ethnic Chinese. Unlike in Germany, Rwanda or Cambodia, there have been no trials, no truth-and-reconciliation commissions, no memorials to the victims. Instead, many perpetrators still hold power throughout the country.

Indonesia is the world’s fourth most populous nation, and if it is to become the democracy it claims to be, this impunity must end. The anniversary is a moment for the United States to support Indonesia’s democratic transition by acknowledging the 1965 genocide, and encouraging a process of truth, reconciliation and justice.

On Oct. 1, 1965, six army generals in Jakarta were killed by a group of disaffected junior officers. Maj. Gen. Suharto assumed command of the armed forces, blamed the killings on the leftists, and set in motion a killing machine. Millions of people associated with left-leaning organizations were targeted, and the nation dissolved into terror — people even stopped eating fish for fear that fish were eating corpses. Suharto usurped President Sukarno’s authority and established himself as de facto president by March 1966. From the very beginning, he enjoyed the full support of the United States.
I’ve spent 12 years investigating the terrible legacy of the genocide, creating two documentary films, “The Act of Killing” in 2013 and “The Look of Silence,” released earlier this year. I began in 2003, working with a family of survivors. We wanted to show what it is like to live surrounded by still-powerful perpetrators who had murdered your loved ones.

The family gathered other survivors to tell their stories, but the army warned them not to participate. Many survivors urged me not to give up and suggested that I film perpetrators in hopes that they would reveal details of the massacres.

I did not know if it was safe to approach the killers, but when I did, I found them open. They offered boastful accounts of the killings, often with smiles on their faces and in front of their grandchildren. I felt I had wandered into Germany 40 years after the Holocaust, only to find the Nazis still in power.

Today, former political prisoners from this era still face discrimination and threats. Gatherings of elderly survivors are regularly attacked by military-backed thugs. Schoolchildren are still taught that the “extermination of the communists” was heroic, and that victims’ families should be monitored for disloyalty. This official history, in effect, legitimizes violence against a whole segment of society.

The purpose of such intimidation is to create a climate of fear in which corruption and plunder go unchallenged. Inevitably in such an atmosphere, human rights violations have continued since 1965, including the 1975-1999 occupation of East Timor, where enforced starvation contributed to the killing of nearly a third of the population, as well as torture and extrajudicial killing that go on in West Papua today.

Military rule in Indonesia formally ended in 1998, but the army remains above the law. If a general orders an entire village massacred, he cannot be tried in civilian courts. The only way he could face justice is if the army itself convenes a military tribunal, or if Parliament establishes a special human rights court — something it has never done fairly and effectively.

With the military not subject to law, a shadow state of paramilitaries and intelligence agencies has formed around it. This shadow state continues to intimidate the public into silence while, together with its business partners, it loots the national wealth.

Indonesia can hold regular elections, but if the laws do not apply to the most powerful elements in society, then there is no rule of law, and no genuine democracy. The country will never become a true democracy until it takes serious steps to end impunity. An essential start is a process of truth, reconciliation and justice.

This may still be possible. The Indonesian media, which used to shy from discussing the genocide, now refers to the killings as crimes against humanity, and grassroots activism has taken hold. The current president, Joko Widodo, indicated he would address the 1965 massacre, but he has not established a truth commission, issued a national apology, or taken any other steps to end the military’s impunity.

We need truth and accountability from the United States as well. U.S. involvement dates at least to an April 1962 meeting between American and British officials resulting in the decision to “liquidate” President Sukarno, the populist — but not communist — founding father of Indonesia. As a founder of the nonaligned movement, Sukarno favored socialist policies; Washington wanted to replace him with someone more deferential to Western strategic and commercial interests.

The United States conducted covert operations to destabilize Sukarno and strengthen the military. Then, when genocide broke out, America provided equipment, weapons and money. The United States compiled lists containing thousands of names of public figures likely to oppose the new military regime, and handed them over to the Indonesian military, presumably with the expectation that they would be killed. Western aid to Suharto’s dictatorship, ultimately amounting to tens of billions of dollars, began flowing while corpses still clogged Indonesia’s rivers. The American media celebrated Suharto’s rise and his campaign of death. Time magazine said it was the “best news for years in Asia.”

But the extent of America’s role remains hidden behind a wall of secrecy: C.I.A. documents and U.S. defense attaché papers remain classified. Numerous Freedom of Information Act requests for these documents have been denied. Senator Tom Udall, Democrat of New Mexico, will soon reintroduce a resolution that, if passed, would acknowledge America’s role in the atrocities, call for declassification of all relevant documents, and urge the Indonesian government to acknowledge the massacres and establish a truth commission. If the U.S. government recognizes the genocide publicly, acknowledges its role in the crimes, and releases all documents pertaining to the issue, it will encourage the Indonesian government to do the same.

This anniversary should be a reminder that although we want to move on, although nothing will wake the dead or make whole what has been broken, we must stop, honor the lives destroyed, acknowledge our role in the destruction, and allow the healing process to begin.

Joshua Oppenheimer is a documentary filmmaker.

Wednesday, September 30, 2015

Pope Francis is no Liberal.

By Richard Mellor
Afscme Local 444, retired

The chameleon-like pope Francis has gone.  In what was almost a state of mass hysteria thousands upon thousands of people turned out to be in his presence. It’s funny; when people turn out for Fidel Castro like that they’re all being manipulated according to the US mass media. And people turning out for the pope are not?  Do they really believe a supernatural being impregnated an Earth women and she gave birth to its son that was killed 33 years later, came back to life and went up to his father in the cosmos?

One thing is for sure, the pope’s (I was taught he was incapable of sin. Does that still stand I wonder?) liberal veneer, the hundreds of photo ops with poor people and little babies and calls for restraining capitalism’s excesses, is overwhelmingly a response to the more affluent and liberal minded Catholic fold in the US and the need to repair some of the damage the mountain of abuse its army of pedophiles handed out across the globe.  It has paid hundreds of millions of dollars in penalties for allowing this crime to continue, not for decades, but centuries.  Vatican Inc. needs money, as do all of them, and it has also been losing potential clients and former ones to the Mormons and the Evangelicals.

As the leading theological representative of the capitalist class, Francis is concerned that capitalism’s excesses could usher in real dangers. The system is becoming so unstable and the wealthy accumulating untold riches as the poor, and most importantly, workers and the middle classes find themselves priced out of existence that millions may lose faith in the system entirely and seek an alternative; collective consciousness may step to the fore.  Following the lead of his secular brethren, from Piketty to Reich, Sanders to Warren, and others, the pope is assailing inequality. Inequality, the wealth gap, is the problem, not the system. It is the cardinal sin of greed that must stand front and center.  You see, we are all sinners; we are born sinners and only Jesus and the  pope, as god’s vicar can redeem us.

Carl Icahn, another social parasite worth $21 billion is very concerned his ill-gotten gains might be at risk if this situation continues and he has added his voice to the billionaires and their politicians speaking out on behalf of the working poor. In a recent paper he writes:

“The average worker makes approximately $50,000 per year. The average annual compensation of the thirty highest paid CEOs is approximately $47 million per year. (I don’t believe this disparity was ever this great even in most dictatorships!) You will hear many politicians argue that government should not interfere with the ‘business judgment’, of our companies and, therefore they cannot pass laws to encourage ‘income equality.’ This is completely untrue – the sad fact is that the government has actually passed many laws that have brought about ‘income inequality.’”

Icahn of course has done his fair share of union busting but is calling now for a healthy dose of Keynsianism (government spending) or legislation at least that distributes a little more of the national wealth to the rest of us. Icahn adds:

“…the American worker is also getting 'screwed' …boards and CEOS have allowed property, plants and equipment of our companies to become the oldest on record and, as a result, the growth rate in productivity per hour of our workers has also become the worst on record and has actually decreased compared to last year. The average age of corporate property, plants and equipment is an astounding 22.3 years, the oldest it has reached since 1941. But I do not believe that most boards and CEOs really give a damn. With many exceptions, CEOs only care about short term results. Perhaps you can’t really blame them because unfortunately, Wall Street judges them based on quarter to quarter results and CEOs receive their egregious compensation based on those short-term results.”

One would think that now we have Icahn and the pope on our side surely all will be well.

But the pope’s liberal veneer is quite thin. The chameleon changes color without reservation depending on the color of its surroundings.  It’s incredible that of all the controversial individual figures the pope could have stopped in to see, he had a private audience with the homophobic and anti-gay marriage religious zealot, Kim Davis.  The pope urged her to stay strong. He stated that it is her human right as a public official to refuse to issue same sex marriage licenses. He referred to this as conscientious objection.

This is an insult to those conscientious objectors who have refused to kill in wars. Most of them wars of conquest, predatory wars.  How come he didn’t go see Chelsea Manning? Talk about heroism and bravery.  Manning revealed to the world the mass violence and murder committed against the Iraqi people, women and young children, in our name as is languishing in prison for it. What about Leonard Peltier or  Mumia Abu Jamal?

He issued a pathetic statement about Junipero Serra the priest he made a saint (a ridiculous notion really) over the objections of numerous indigenous leaders and tribal representatives.  Did he meet with any of them? What the pope has ensured by his anti gay marriage and anti LGBT stand and his objection to the right of women to control their own bodies is a victory for zealots like Davis. The pope's concession to women, perhaps without realizing what an insult it is, urged priests, (men who have no relationships with women and no family in that sense) to absolve women who confess and seek forgiveness for  "the sin of abortion" in the upcoming "Year of Mercy,".  What arrogance, it's an attack made to appear as friendship. Women have committed no wrong they need to apologize to a priest or the pope for?  As Jill Filipovic comments in the NYT,:

"But mercy may actually be worse. While the pope’s announcement has been hailed as evidence of the church’s new, softer approach, it’s actually the latest example of the modern anti-abortion strategy: Portray women as victims who need to be protected from themselves with laws that restrict abortion rights."

Filipovic adds: "Despite the concern for what the pope calls an “agonizing and painful decision,” research shows that a vast majority of women who terminate pregnancies in the United States don’t actually feel bad about it." 

The offensive on a woman's right to choose is more subtle in the face of women fighting for control of their own reproductive rights as they are in Ireland where the anti-abortion section of the constitution is likely to be discarded.  The Catholic Church has lost its power in Ireland, brutal as it was and most of the abuse took place there. It's a very malicious and insidious approach they're taking now.

As for Davis, she  was not denied the right to not issue wedding licenses to gays.  She could have quit her job.  She refused to do her job that’s what she did. What happens to soldiers that refuse to carry out their duties?  As Trevor Martin of the Guardian commented:

“Davis, with whom (the pope) he met and apparently offered moral support to, was quite free to conscientiously object to same-sex marriage. She even had the opportunity to resign or allow her deputies to issue the licenses without her, but she refused to do either – and went so far as to reportedly altering the license forms in a manner that may invalidate people’s marriages. She apparently thought she could “conscientiously object” and keep the perks of the job she conscientiously objects to performing at the same time.”

Freedom means different things to different people. Freedom to Carl Icahn means the right for him to do what he wants with the capital he owns although he did not create that wealth. In the capitalist mode of production that is legal. To some religious leaders religious freedom means the right to remove a male child’s body part before an age of consent.

Faith is a personal matter, it is between the believer and their gods whatever form that takes.  The Vatican is not only a state, it is a business and the pope is the CEO.  And like all CEO’s and heads of state, their job is to ensure things stay under their control.

British Labour, Marxist McDonnell and deficit-denying

by Michael Roberts

The election of a new leader of the UK’s opposition Labour party has provoked a flurry of interest in the international media and among economists.  That’s because the new leader, Jeremy Corbyn and his newly appointed finance spokesman, John McDonnell, have been considered as ‘avowed Marxists’.


That is certainly the case for McDonnell.  He is an ‘avowed Marxist’ because he says he is.  On the day of his big keynote economics speech at Labour’s annual conference this week, he said that “If you look at our capitalist system, one of the definitive analysts of how it works – not whether it is condemned, or whether it is right or wrong, just the mechanics of how it works, when it was formed and how it would be developed – actually was Marx.”  He went on “If you look at most of the institutions that are teaching economics today. Marx has come back in to fashion because people have gone back to his analysis of just the basics of how the system works. People might disagree with his conclusions about what to do with the system, but actually to understand how the system works he comes up with some interesting analyses that have been built in to traditional and fairly classical economics.” 

However, note that John McDowell makes a distinction between Marx’s ‘interesting analysis’ of the capitalist system i.e. what is wrong with it, and “his conclusions about what to do”.  Thus Marxist policies for dealing with capitalism do not necessarily flow from his analysis, it seems. What policies do?  Well, apparently, it is Keynesian prescriptions.  Thus McDonnell has announced a panel of economic advisers, including international luminaries like Joseph Stiglitz and Thomas Piketty, to help on policy.  This committee is drawn from the Keynesian mainstream and its heterodox wings, but not Marxist.

I’m sure that it looks like a very good political ploy to involve leading economists in Labour’s economic plans. No doubt it is hoped that it will disarm criticism from the financial media and big business when a Noble prize winner and the economist of the moment are on the committee. But this reminds me more of the approach of Greece’s Syriza, which started out with a Marxist ‘analysis’ of Greek capitalism but which, according to Yanis Varoufakis and Costas Lapavitsas, should be put aside when it comes to policy because Keynesian economics is more relevant ‘in practice’.
You see the problem is a ‘lack of demand’, not a lack of profitability. So, in a slump, Keynesian prescriptions call for more government spending or a reversal of ‘austerity’ (in the current parlance), so that spending boosts employment and incomes and restores household consumption (and investment?) as the means to recovery.  That means running budget deficits through more government borrowing (issuance of more bonds).

Keynesians generally dismiss those (Austerians and neo-liberals) who worry that, as a result, spiralling government debt will lead to a new crisis as governments find they cannot service their debt except at unaffordable interest rates (Greece and the peripheral Eurozone economies, Puerto Rico etc).  You see, for Keynesians, one man’s debt is another’s asset.  So the only problem is if it is foreigners who own the debt.  If they demand repayment, they can cripple the currency.  This is the view of Paul Krugman in the US and Simon Wren-Lewis, the British Keynesian guru, now part of McDonnell’s advisory team.

But debt does matter.
  One of the features of the global financial crash was the massive rise in private sector debt (household and corporate) before the credit crunch in 2007.  That debt rose as capitalist economies tried to keep profitability of capital and economic growth up through a low interest rate, credit-fuelled bubble in unproductive sectors of finance and property.  The private credit bit (not the profitability bit) is the Minskyite view of the crisis as expounded in particular by Steve Keen and Anastasia Nesvetailova (one of the McDonnell’s new advisers).

But as I have explained on many occasions in this blog, the credit boom of the 2000s was a response to declining profitability of capital in the productive sectors of the US, UK and other major economies from the end of the 1990s.  It staved off a major slump, only to create an even larger one in 2008-9.

That’s private sector debt.  But the same issue applies to public sector debt.  If the owners of this debt (banks, hedge funds, pension funds, insurance companies) decide that they want to get their money back or demand lots more in interest to renew loans or buy government bonds, they can cripple the ability of a government to pay for welfare benefits and public services, let alone investment in roads, hospitals and schools.

Debt does matter in a capitalist economy: capitalists owe to other capitalists; households owe to finance capitalists; and governments owe to finance capitalists.  The holders of this debt expect a return and prompt repayments.  Under a predominantly state-owned and planned economy, state companies, households and governments would owe to other state companies.  So the decisions on the cost of borrowing and repayment terms could be decided as part of a national plan and not by the ‘market’ and on the profitability of (finance) capital.

Ironically, having selected Keynesians and Minskyites for his ‘team’, John McDonnell has made it clear from the start that he is not a ‘deficit denier’.  By this, he means that he does accept that running government budget deficits cannot be ignored, as the Keynesians reckon.  As McDonnell put it: We accept we are going to have to live within our means and we always will do – full stop.”  And he advocates signing up to the Conservative government’s fiscal charter that will make it a law that government’s must ‘balance the books’ over the ‘business cycle’“We will support the charter. We will support the charter on the basis we are going to want to balance the books, we do want to live within our means and we will tackle the deficit.”

This is clearly a political ploy by McDonnell to avoid the charge being made by the Conservatives that Labour ,when in government, allowed deficits to get out of control and thus caused the crisis and the Great Recession and that Labour has no regard for ‘balancing the books’. This charge, of course, is nonsense and a downright lie.  Actually, when in government, Labour generally ran lower budget deficits than the Conservatives and under ‘prudent’ finance minister and PM Gordon Brown, government spending was kept well under control, as Ann Pettifor, one of McDonnell’s new Keynesian advisers, has pointed out.

The UK’s budget deficit spiralled only when the global financial crash came and British banks had to be bailed out with taxpayer’s money (borrowing).  This prompted Gordon Brown to tell the British parliament that he had ‘saved the world’ (a slip of hubris, meaning he had saved the banks).  The current government deficit, still way higher than in other G7 economies under the Conservatives and government debt still rising towards 100% of GDP, was the product of the capitalist crisis (the financial meltdown and the ensuing Great Recession).

McDonnell says that this deficit and the government debt can be reduced not by cutting welfare and public services as the Conservatives have done and are doing.  It is a political choice.  Instead it can be done by raising taxes on the rich (reversing cuts in corporation tax and inheritance tax), reducing ‘corporate welfare’ (around £90bn a year), dealing aggressively with tax evasion and avoidance by the likes of Vodafone, Amazon, Google and Starbucks (worth up to £120bn a year).  And Labour under McDonnell would also stimulate economic growth by borrowing to invest in infrastructure projects.  McDonnell also estimates that £80-100bn could be saved (over 30 years, mind) by scrapping the Trident nuclear submarine programme due for renewal next year.

Laudable as these aims are, as I have pointed out in a previous post, much of these tax gathering measures may not deliver enough extra revenue to close the deficit – if that is the aim, apart from making inequality of income and wealth, ludicrously high, just a little less extreme.  It has been pointed out that it will be very difficult to raise the necessary extra £30bn a year in taxes without hitting middle-income earners – unless UK economic growth takes off from its current 2.0-2.5% a year expansion rate.

The circle could easily be squared if private sector incomes (wages and profits) rose substantially faster to deliver much higher tax revenues. But that is not going to happen under a predominantly capitalist economy where profitability is key to investment, employment and income growth.  British capitalism has already failed to invest, preferring to pocket its profits and/or speculate in financial assets or invest abroad.  And that’s with the lowest corporate tax rate among the major economies, as Conservative finance minister George Osborne likes to boast.  Higher taxes on the capitalist sector, namely the big companies that invest and employ the bulk of the British economy and people, will only mean a further failure to invest.

The ‘new’ Labour leadership replacing the ‘old’ (‘New Labour’, neo-liberal) leadership is pledged to expand public investment in infrastructure, ‘green’ sectors and in housing and transport.  This will undoubtedly help to sustain economic activity apart from helping the majority instead of the 1%.  But Corbyn and McDonnell’s National Investment Bank will not be enough to deliver sufficiently faster growth as long as the UK economy is still dominated in its strategic sectors by capitalist profit-making companies in the City of London (privatised banking, insurance and pension funds); by large pharma and aerospace companies; telecoms (BT), house-building companies and transport (rail, bus and airlines) etc.

Along with a National Investment Bank (and fully state-owned banking), what is needed is a National Plan for investment, employment and services based on a predominantly state-owned economy, democratically controlled and operated. But that is the Marxist prescription from the ‘interesting’ Marxist analysis of the capitalist economy.  Instead, the new Labour leadership likes the Marxist ‘analysis’ but looks to Keynesian ‘solutions’.

Capitalism has regular and recurring crises – that’s one unique conclusion from the Marxist economic analysis, something not accepted or recognised by mainstream, Keynesian or Minskyite economic theory. As I argued in a previous post, British capitalism, along with global capital, is likely to enter another slump before the next British general election in 2020.  Indeed, McDonnell has also noted that many of the features that led to the last Great Recession: a credit boom, a housing bubble, bank speculation etc, have re-emerged.

Keynesians did not see the last slump (the Great Recession) coming and did not have the policies to deal with it, at least in the interests of the majority.  So relying on Keynesian policies to handle or avoid the next slump, even as a political ploy, may be a hostage to fortune for the new Labour leadership.

Tuesday, September 29, 2015

BBC's Andrew Marr interviews Jeremy Corbyn

For those that haven't seen it here is the full interview of Jeremy Corbyn by the BBC's Andrew Marr.

Monday, September 28, 2015

Video: Jeremy Corbyn speaks to Women's conference 2015

Here is British Labor Party leader Jeremy Corbyn's speech to the Women's Conference 2015 at the Labor Party Conference held this weekend.

US and World economy: From crawl to crash?

by Michael Roberts

The final figures for US real GDP in the second quarter of this year (April to June) were released at the end of last week.  They showed that the US economy was growing at an annual rate of nearly 4% (3.9%) in the summer after yet another poor first (winter) quarter of just 0.6% growth.  So, compared to summer 2014, the US economy has expanded by 2.7%.  Indeed, the US economy has been growing at that sort of rate for the last four quarters.

However, before the cry comes that, finally, American capitalism is back on a sustained trend in growth similar to that before the Great Recession, there are some caveats.

First, the growth in gross domestic income (as opposed to product) is much slower.  GDI slowed to just 2.1% yoy in Q2 2015.  Gross domestic income is the income received by American homes and businesses.  If gross domestic product grows more, it means more of the value of that domestic production has gone to foreign businesses and abroad.

Second, the reason that GDP growth seems to have picked up in the second quarter is that for virtually the first time since the Great Recession, the government sector expanded.  In Q2, America’s states (not the federal government) contributed 12% towards US economic growth, instead of reducing it, as healthcare spending rose.

Also, although business investment rose, it contributed a relatively smaller proportion towards GDP growth (20%) compared to previous quarters and years since the end of the Great Recession.  Growth was mainly achieved by households buying more cars, electrical goods and spending more on healthcare (Obama-care?) and taking out mortgages to buy more homes. US growth is consumer-driven and debt-financed (with interest rates at all-time lows).

But the most sobering caveat is that in the current quarter (Q3) just ending this week, US real GDP growth looks likely to have slowed down sharply from that near 4% rate to something close to 2%.  Indeed, the Atlanta Federal Reserve real GDP forecasting indicator, which has been very accurate in the recent years, forecasts just a 1.4% growth rate for Q3.
Atlanta now
And the forecast slowdown is not really surprising because economic data in this current quarter has been very weak: factory orders, retail sales, durable goods orders, industrial production etc.
Alongside this US slowdown, the major capitalist economies, both advanced and so-called ‘emerging’, have been slowing.  According to the OECD, economic growth in the 34 major advanced capitalist economies grew by only 0.4% in the second quarter of 2015 from the first quarter – a deceleration from the 0.5 per cent quarter-on-quarter growth achieved in the first three months of this year.  Year-on-year GDP growth for the OECD area remained unchanged at 2 per cent in the second quarter of 2015.

And in this quarter of the year, global growth seems to have slowed even more.  The UK economy, which was the leader in the top G7 economies, may struggle to achieve 2% growth, while Germany, France, Japan and Italy will be closer to 1%.  And the major ‘emerging’ economies are diving.  We have all heard about China slowing fast, leading to slowdowns in Australia, New Zealand and most of south-east Asia.

But on top of the ‘China crisis’, there are outright slumps in Brazil and Russia and low growth in Turkey, South Africa and Indonesia.  Even India’s real GDP growth, which has been racing along at about 7% a year, turned down this quarter.  The global crawl is turning paralytic.
World trade is heading back to the depths of the Great Recession.
World trade
Indeed, the latest update of my global business activity index (based on purchasing managers indexes around the world), shows a sharp contraction in activity among emerging markets.
business activity
So it is no wonder that the US Federal Reserve drew back from its planned hike in interest rates in September.  The Fed statement specifically highlighted the global economic slowdown as the reason for holding off (at least until December).  The Fed, along with many mainstream economists, that hiking US rates would spill over into higher cost of borrowing and debt servicing and possibly trigger a collapse in stock and bond markets globally – something I have highlighted before as another ‘1937’.

Several financial strategists are already worried that stock markets are overvalued compared to future earnings and profits. And that’s what the ‘Warren Buffet’ indicator of the value of corporate stock to GDP shows – significant over-valuation.
Buffet indicator
That’s where the latest data on corporate profits come in.  In Q2 2015, US corporate profits, after taking into account inventories and depreciation (in other words, new profits), rose just 0.6% compared with summer 2014 and, after tax, actually fell 0.6%.
corporate profits
And there was a sharp increase in dividends paid out to shareholders by corporations.  So the available profit for investment has dropped 4.6% compared to summer 2014.  Moreover, two-thirds of the rise in profits in Q2 2015 accrued to the financial sector with just one-third to productive sectors.
Globally too, corporate profit growth remains low.  Indeed, without a sharp rise in Japanese corporate profits in Q2, growth would have been a trickle.  Indeed, Chinese industrial profits fell nearly 9% in August compared to August 2014.
global profits
Looking out longer term, a new report from the management consultant, McKinsey (MGI Global Competition_Executive Summary_Sep 2015) reckons that “the world’s biggest corporations have been riding a three-decade wave of profit growth, market expansion, and declining costs. Yet this unprecedented run may be coming to an end”.  According to McKinsey, the global corporate-profit pool, which currently stands at almost 10% of world GDP, could shrink to less than 8% by 2025—undoing in a single decade nearly all of the corporate gains achieved relative to the world economy during the past 30 years.

From 1980 to 2013, vast markets opened around the world while corporate-tax rates, borrowing costs, and the price of labour, equipment, and technology all fell. The net profits posted by the world’s largest companies more than tripled in real terms from $2 trillion in 1980 to $7.2 trillion by 2013, pushing corporate profits as a share of global GDP from 7.6% to almost 10%.

But McKinsey reckons that profit growth is coming under pressure. This could cause the real-growth rate for the corporate-profit pool to fall from around 5% to 1%, practically the same share as in 1980, before the boom began.  So the great neo-liberal period of corporate profit recovery is over. According to McKinsey, margins are being squeezed in capital-intensive industries, where operational efficiency has become critical.  Meanwhile, some of the external factors that helped to drive profit growth in the past three decades, such as global labour arbitrage (globalisation) and falling interest rates, are reaching their limits.

As I have argued on many occasions,
from the movement in profits flows the movement in investment and then to overall economic growth.  If profits, both globally and in the US, start to fall, then eventually so will investment and the slow economic growth recorded in the major capitalist economies since 2009 could turn into a new slump.

Economic recessions or slumps seem to occur about every 8-10 years in the post 1945 period (1958-60, 1970, 1974-5, 1980-2, 1990-2, 2001, 2008-9), the so-called business cycle.  If that cycle is to reoccur, then the next recession is due between 2016 and 2018 (given that the last began in 2008).

I have argued that we can discern a profit cycle as well as a business cycle (see my book, The Great Recession).  The cycle of profitability is about 32-36 years, trough to trough, in the US.  The last trough was in 1982, followed by the so-called neoliberal revival in profitability until 1997-00.  The current downwave should therefore trough no later than 2018.  If this is right – any scientific analysis worth its salt should make predictions that can be proved wrong (or right) – then profitability in the US should be heading downwards pretty soon.  All this suggests a major slump within 1-3 years.
The world economy is still crawling along, but interest rates are at all-time lows and stock markets are way overvalued.  Any shift up in the cost of borrowing and any shift down in profitability would turn that crawl into crash.