Wednesday, July 29, 2015

Agriculture and the inefficiency of the market

Richard Mellor
Afscme Local 444, retired

In the capitalist mode of production in which the means of producing the necessities of life is owned by private individuals or groups of individuals, the capital needed to set this process in motion is allocated only if its profitable to do so, only when the investment returns value over and above that which the capitalist lays out. The end goal of this production process which might appear in the form of shoes, cars or some other commodity, is a secondary factor in the capitalists’ mind; the rapacious striving for profits is what drives them, the added value, created through the production process and realized with he stale of the commodity.

Cows raised industrially, are fed growth hormones and all the equally destructive chemicals that end up in our bodies for no reason other than the cow is a commodity that has to be sold in order to realize the added value contained within this living creature. The quicker it reaches maturity, the quicker it gets to market and hopefully sold the quicker the investment plus the added value is returned so the whole process can repeat itself. The profit does not stem from selling the cow above it’s value but in the process of production itself as the capital the capitalist doles out for labor power (the workers wages) is less than the value that labor power creates.

This is obviously a very inefficient way of producing the necessities of life for a global population. In fact, this system of production has failed miserably when it comes to producing basic needs for hundreds of millions of the world’s people.  Basic human needs like water, food, medicine, health care, shelter and education are denied a couple of billion people every day simply because it’s not profitable to do so. In other epochs we starved because agricultural production had not developed to the point where we could feed ourselves. We died from diseases we now control or have eliminated because the science behind them had not yet been discovered and public health was not advanced enough.  In the capitalist mode of production we die amid plenty, we die despite the means of saving life being present. But if investing in sewage systems, water plants, health care or social infrastructure is not profitable capital will not find its way there.

Jo Craven McGinty had a column in the WSJ recently about California’s drought and water usage in the state.  There has been much about this subject given that we are in a four-year of one.  Mother Jones Magazine has covered the issue extensively and pointed out the massive amount of water that the now trendy and very popular Almond consumes.  Ms McGinty crunches some of these numbers in her column. Using figures from UC Davies she points out that in the Southern Sacramento Valley mature almond trees use about 3.5 feet of water on average per year which is about the state average. In the San Joaquin Valley that climbs to more than 50”.

She points out that “One cubic foot holds 7.48 gallons of water, and one acre measures 43,560 square feet. Irrigating a full acre to a depth of 3.5 feet over one growing season would consume 1,140,401 gallons of water.”

In California, an acre of land supports about 124 almond trees and although crop yields vary, in 2014 an acre produced close to 2,270 pounds of almonds which works out at about 520 gallons of water for a pound of nuts. Almond production in California occupies 860,000 acres of farmland.

Almonds were not always this abundant in California.  While they’ve been grown here since the mid 19th century they have become a major profitable crop. A trendy marketing campaign and a growing middle class in China in search of a higher protein diet has boosted production also. Increased production is also due to fertilization (Nitrogen, Zinc eg) and irrigation. California produces about 84% of global almond consumption. 

Hedge funds and investors have moved in to the Almond producing business where returns have hit 30% in some cases. There have been extensive marketing campaigns pushing almonds that have driven almond production to new highs and the California almond market hit 4.8 billion in 2012.  One farmer explained that he quit raisins for almonds which are more profitable.

TIAA-CREF, a NY investment fund owns 37,000 acres of California farmland and has been pushing its investors in to almond production; it’s an "attractive long-term investment theme" the company tells its clients. Numerous institutional investment companies own huge tracts of California farmland.  Stewart Resnick, who made money in real estate is one of the largest private producers. In an earlier piece I wrote on Resnick and his dealings, there’s more information about this waster.

Irrigation, fertilization, mass marketing and advertising------ industrial for profit farming is what we are witnessing here. In fact the pollination of California’s almonds is what Mother Jones’ Tom Phillpot refers to as the “….largest annual managed pollination event in the world…” as one million bee hives (almost half the hives in the US) are trucked in to the area in February. Philpott also points out that the Resnicks hired Korean rapper Psy and Stephen Colbert to push the commodity for them.

In 2010, a typical year, the Journal’s Ms Mcginty writes,  California agriculture consumed 33 million acre feet of irrigated water, while urban uses, including landscaping, consumed 8.3 million acre feet. One acre foot is 326,000 gallons. The state’s total agricultural and urban consumption, then, exceeded an incomprehensible 13.4 trillion gallons of water.”

 “How can we grow more food with less water?” one so-called expert asks. “Here’s the deal,” Daniel A. Sumner, an agricultural economist at the University of California at Davis tells the Journal. “Plants use lots of water. They breathe it in.”

But there is no solution to this problem that offers anything but continued environmental degradation and catastrophe. The market may find a more profitable use of capital and almonds and other crops may well decline in production, but the destructive process will continue. And as a grower commented to Resnick; “The sound of money is when a harvester goes next to a tree in an orchard with 7000 pounds of pistachios and shakes it. That sound, when the pistachios hit the catch frame, that’s the sound of money.” “It’s like a Vegas slot machine,”

Does this sound like a person whose mind is absorbed with producing food for the world’s hungry? Of course not. He could be producing condoms; it is profits that matter to him.

So is there no solution to this destructive market process?  I do not think it is possible to avoid environmental disaster as long as such vital human needs and the production of them is in private hands. What sort of social system allows one man or family to own the water necessary for the production of the food needed to sustain life for millions of people? How is it that What right do a gang of faceless investors, owners of capital, can determine how food is produced, what is produced or whether it’s produced at all?  It’s the laws of the market that allows it, just as it is the law of the market that allows them to own capital that is a collective product or allows them to take your home or destroy the environment.

How capital is allocated in society, as with human labor power, which are both necessary aspects of the production of human needs, must be a conscious, collective democratic process. Not determined by faceless bureaucrats at the apex of a totalitarian social system like the former Stalinists states, but through the participation of human beings as consumers and as workers, whether directly involved in the production process or as scientists, engineers, and all others that contribute to the sustaining of human life. The most illiterate rural peasant had extensive knowledge of weather patterns, soil conditions, animal behavior and other important aspects of agricultural activity, just as an old fisherman does about the ocean. It is not that “experts” are bad and modern technology inherently destructive, it is that they function, as we all do, as hired hands of those whose sole purpose as owners of capital is the rapacious quest for profits, the rate of return on their investment, whether it’s the production of almonds or sneakers.

Transforming the way we produce the necessities of life from a for profit system that is in conflict with the natural world to one based on human need and in harmony with it, is not a Utopian concept, we have lived that way for thousands of years of human history, it is the only way we can avert the destruction of life as we know it which is inevitable as long as capitalism and the market rules.

Varoufakis and economists facing treason charges.

Yanis Varoufakis
The media is reporting that that all those implicated in the treason charges, including James Galbraith, face charges including breach of privacy and operating as a criminal gang. Here is Yanis Varoufakis' response sent out today.
Treason charges: What lurks behind the bizarre allegations

The bizarre attempt to have me indicted me on… treason charges, allegedly for conspiring to push Greece out of the Eurozone, reflects something much broader.

It reflects a determined effort to de-legitimise our five-month long (25th January to 5th July 2015) negotiation with a troika incensed that we had the audacity to dispute the wisdom and efficacy of its failed program for Greece.

The aim of my self-styled persecutors is to characterise our defiant negotiating stance as an aberration, an error or, even better from the perspective of Greece’s troika-friendly oligarchic establishment, as a ‘crime’ against Greece’s national interest.

My dastardly ‘crime’ was that, expressing the collective will of our government, I personified the sins of:
  • Facing down the Eurogroup’s leaders as an equal that has the right to say ‘NO’ and to present powerful analytical reasons for rebuffing the catastrophic illogicality of huge loans to an insolvent state in condirion of self-defeating austerity
  • Demonstrating that one can be a committed Europeanist, strive to keep one’s nation in the Eurozone, and, at the very same time, reject Eurogroup policies which damage Europe, deconstruct the euro and, crucially, trap one’s country in austerity-driven debt-bondage
  • Planning for contingencies that leading Eurogroup colleagues, and high ranking troika officials, were threatening me with in face-to-face discussions
  • Unveiling how previous Greek governments turned crucial government departments, such as the General Secretariat of Public Revenues and the Hellenic Statistical Office, into departments effectively controlled by the troika and reliably pressed into the service of undermining the elected government.
It is amply clear that the Greek government has a duty to recover national and democratic sovereignty over all departments of state, and in particular those of the Finance Ministry. If it does not, it will continue to forfeit the instruments of policy making that voters expect it to utilise in pursuit of the mandate they bestowed upon it.

In my ministerial endeavours, my team and I devised innovative methods for developing the Finance Ministry’s tools to deal efficiently with the troika-induced liquidity crunch while recouping executive powers previously usurped by the troika with the consent of previous governments.

Instead of indicting, and persecuting, those who, to this day, function within the public sector as the troika’s minions and lieutenants (while receiving their substantial salaries from the long-suffering Greek taxpayers), politicians and parties whom the electorate condemned for their efforts to turn Greece into a protectorate are now persecuting me, aided and abetted by the oligarchs’ media. I wear their accusations as badges of honour.

The proud and honest negotiation that the SYRIZA government conducted from the first day we were elected has already changed Europe’s public debates for the better. The debate about the democratic deficit afflicting the Eurozone is now unstoppable. Alas, the troika’s domestic cheerleaders do not seem able to bear this historic success. Their efforts to criminalise it will crash of the same shoals that wrecked their blatant propaganda campaign against the ‘No’ vote in the 5th July referendum: the great majority of the fearless Greek people.

Tuesday, July 28, 2015

Denouncing Police Unions: A Letter to The AFL-CIO

Note: UAW 2865 represents over 13,000 student workers throughout the California University system. The local can be reached at:  
UAW Local 2865 / 2030 Addison Street, Suite 640A (map) Berkeley, CA, 94704
Phone: 510-549-3863 / Email:

Denouncing Police Unions: A Letter to The AFL-CIO

We, UAW Local 2865, call on the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) to end their affiliation with the International Union of Police Associations. It is our position that this organization is inimical to both the interests of labor broadly, and Black workers in particular. Historically and contemporarily, police unions serve the interests of police forces as an arm of the state, and not the interests of police as laborers. Instead, their “unionization” allows police to masquerade as members of the working-class and obfuscates their role in enforcing racism, capitalism, colonialism, and the oppression of the working-class. We ask that the AFL-CIO recognize this history and take steps to serve the interests of its Black workers and community members.

The AFL-CIO’s official mission is “to fulfill the yearning of the human spirit for liberty, justice and community; to advance individual and associational freedom; [and] to vanquish oppression, privation, and cruelty in all their forms.” This, we argue, is the calling of a union to be a force for advancing the lives of workers. Within this framework, police unions fail to meet the criteria of a union or a valid part of the labor movement.

While it is true that police are workers, and thus hypothetically subject to the same kinds of exploitation as other laborers, they are also the militarized, coercive arm of the state. It is the job of the police to protect capital and, consequently, maintain class society. How can there ever be solidarity between law enforcement and the working class when elites call upon police and their organizations to quell mass resistance to poverty and inequality? The police force exists solely to uphold the status quo. Their material survival depends on it, and they hold a vested interest in the preservation and expansion of the most deplorable practices of the state.

Present Day:
We have seen this vested interest manifest itself very visibly over the past year. By calling themselves a union, police have utilized union resources to defend brutality and anti-Blackness. Police unions channel resources towards upholding racist practices in a few key ways:

  1. Lobbying to oppose independent oversight by civilians and other governmental entities.
  2. Campaigning for political actors who support limited police accountability.
  3. Defending officers’ crimes of racist brutality in court.  

These elements have clearly shaped the context that enabled the tragic circumstances of Freddie Gray’s death and speak to the contemporary moment in which Black lives are considered less important than job protection for police. Advocated for by the police union, The Maryland Law Enforcement Officers’ Bill of Rights (LEOBoR) aims to protect the rights of officers above the needs of the community. In cases where police misconduct is reported, such as in instances of “rough rides,” police officers do not have to answer questions until 10 days have passed and a lawyer has been consulted. Subsequently, the overall review process outlined by the LEOBoR empowers a hearing board of fellow officers to have final approval over any penalties imposed upon accused officers—this has resulted in the preservation of employment for nearly all accused officers despite the 3,048 complaints have been filed against 850 Baltimore PD officers (30% of its police force) since 2012.  If complaints do manage to make it past this extra layer of due process, union legal resources are used to defend the officers against charges of racist misconduct in court. By unconditionally insulating officers accused of brutality from facing consequences, police unions maintain the status quo of racial violence that upholds the exploitation of Black communities in particular, as well as other communities of color.

Historical Evidence:
We recognize that these are not isolated incidents, but arise from a long history of policing as a profession. Police unions in particular emerge out of a long history of police intervention in labor politics and its complicity in racial violence. The modern U.S. institution of the police has roots in the repressive demands of powerful white capitalists. Overseers and slave patrols in the South evolved alongside the growing need to maintain “order” in early urban areas in the North. In fact, armed “night watches” mirrored policing practices by being a front line of defense against Native American raids on colonies. Policing in the U.S. has always served the needs of colonialism, racism, and capitalism by protecting the property of those who would steal land and exploit the labor of others. Neither the property of indigenous people nor the products of the labor of both workers and slaves has ever come under protection of the institution of the police. It has only ever been the property of the powerful that the police protect. Maintaining this system of relations is the so called “order” that police have sworn to defend.

In fact, early attempts by labor to organize and fight for rights and better pay and working conditions have historically been met with violence. These instances are many: from picket line fights to police enforced lock-outs; from crackdowns on rallies, like the Thompson Square “riot” of 1874 at a rally for the unemployed in New York City, when police indiscriminately brutalized men, women, and children; to massacres committed by private police, like the two dozen men, women, and children killed in the Ludlow Massacre; and by public police, notably during the Haymarket Massacre we commemorate every year on May Day.

Modern examples exist as well: police played a significant role in defending Jim Crow segregation. We have all seen the images and video of police siccing dogs on Black protesters, shooting them with water cannons, or billy clubbing them. Racist violence was not confined to the pre-Civil Rights South; Philadelphia police bombed the headquarters of Black radical organization MOVE in 1985,  killing 11 people, including children. Recall also the assassination of Fred Hampton, leader of the Black Panther Party, by the Chicago PD in collaboration with the FBI. Very recently, the nationally-coordinated effort to crack down on and ultimately destroy the Occupy movement involved police departments across the country working in unison to stop the most effective modern social movement in opposition to economic inequality. American police as an institution have historically been and continue to be the violent supressive force used to maintain a white supremacist capitalist system on settler colonial land. If labor is to ever truly exert its power and challenge the corporate rule of the U.S., we will need to break the illusion that the police are part of the family of unions that make up organized labor.

The AFL-CIO is an organization truly concerned with issues facing the laborers of America today. The history of policing and its use of union resources to silence those who are harmed by police brutality runs contrary to this mission statement. As Shawn Gude recently put it, to become agents of progressive change and labor solidarity, police unions would need to work actively to negate their own power and abolish the police. We endorse this position, and call on the AFL-CIO to do so as well. As a union, we argue that the International Union of Police Associations fails to adhere to the goals of the Federation, and therefore should not be included in the list of unions which are fighting for worker’s rights.

Here's what your dental bills might pay for. He paid $50,000.

I have dental insurance and as I grow older it is still not enough to cover my aging teeth.  When you complain about the exorbitant costs of dental work and other medical procedures here's where some of your hard earned cash ends up.

This dentist killed this creature with a crossbow. Put the bastard out of business.

From AP
HARARE, Zimbabwe (AP) — Zimbabwean police said Tuesday they are searching for an American who allegedly shot a well-known, protected lion with a crossbow in a killing that has outraged conservationists and others.

The American allegedly paid $50,000 to kill the lion named Cecil, Zimbabwean conservationists said. Authorities on Tuesday said two Zimbabwean men will appear in court for allegedly helping with the hunt. The American faces poaching charges, according to police spokeswoman Charity Charamba.
Walter James Palmer was identified on Tuesday by both the Zimbabwe Conservation Task Force and the Safari Operators Association of Zimbabwe as the American hunter, a name that police then confirmed.

"We arrested two people and now we are looking for Palmer in connection with the same case," said Charamba.

Emmanuel Fundira, the president of the Safari Operators Association of Zimbabwe, said at a news conference that Palmer is from Minnesota and his current whereabouts were unknown.
Phone calls to two listed home phone numbers for Palmer rang busy on Tuesday. Phone calls to his dental office in the Minneapolis suburb of Bloomington also went unanswered, and a message couldn't be left because the office mailbox was full.

The front door to the office building was locked when a reporter approached Tuesday morning. A woman who came to the door said Palmer was not in the office and was not seeing patients on Tuesday.

The two arrested Zimbabwean men — a professional hunter and a farm owner — face poaching charges, the Zimbabwe National Parks and Wildlife Authority and the Safari Operators Association said in a joint statement. Killing the lion was illegal because the farm owner did not have a hunting permit, the joint statement said. The lion was skinned and beheaded. The hunters tried to destroy the lion's collar, fitted with a tracking device, but failed, the statement said.
If convicted, the men face up to 15 years in prison.

The lion is believed to have been killed on July 1 in western Zimbabwe's wildlife-rich Hwange region, its carcass discovered days later by trackers, the statement said.

The Zimbabwe Conservation Task Force said in a statement that an American paid the $50,000 for the hunt. During a nighttime hunt, the men tied a dead animal to their car to lure the lion out of a national park, said Johnny Rodrigues, chairman of the Zimbabwe Conservation Task Force. The American is believed to have shot it with a crossbow, injuring the animal. The wounded lion was found 40 hours later, and shot dead with a gun, Rodrigues said in the statement.

"The saddest part of all is that now that Cecil is dead, the next lion in the hierarchy, Jericho will most likely kill all Cecil's cubs," said Rodrigues.

The Zimbabwean hunter accused in the case claimed that Cecil was not specifically targeted, and the group only learning after the fact that they had killed a well-known lion, according to the Safari Operators Association.

Cecil, recognizable by his black mane, was being studied by an Oxford University research program, the conservation group said.

Tourists regularly spotted his characteristic mane in the park over the last 13 years, said Lion Aid, also a conservation group.
Associated Press reporters Amy Forliti in Bloomington, Minnesota, and Brian Bakst in St. Paul, Minnesota, contributed to this report.

Quarterly capitalism

by Michael Roberts

You see what’s wrong with capitalism is that it is short-sighted.  Apparently, corporate chiefs, investment banks and investors are just after a quick buck.  They never look to the long term, to the bigger picture, to a strategy of investment for sustained growth.

This is what budding presidential candidate from the Clinton royal clan, Hillary, told the very eminent New York University Stern School of Business last week.  ‘Quarterly capitalism’, as she called it, just looks at the quarterly earnings results of a company as a guide to investment.  This works against proper investment.  So Hillary proposes to tax short-term capital gains on the stock market more heavily in return for incentives to invest for the long term.

Hillary Clinton did not invent ‘quarterly capitalism’ as a term to describe what previous observers of capitalism have called ‘short-termism’.  This latest slick aphorism came from the head of McKinsey, Dominic Barton.  McKinsey, as the Goldman Sachs of management consultancy, is always looking to discern and explain long term trends of capitalism.  “Lost in the frenzy [of short termism],” wrote Barton, “is the notion that long-term thinking is essential for long-term success.”

What is puzzling and worrying Clinton and Barton is that capitalism is not delivering sustained economic growth and investment in new technology that can raise the rate of productivity of labour.  Last year S&P 500 companies spent more than $500bn on share buybacks, while investment in productive assets remains in the doldrums.  So capitalism is myopic.

Well, this is not a new message.  And it’s partly true.  An economy that is based on making money or profit is inevitably going to face the continual problem that some will take a quick profit at the expense of the development of human capital and technology for the long term.

The evidence for short termism as the reason for a failure to invest is questionable actually.  One study has confirmed that publicly quoted companies with share prices to worry about tended to invest ‘substantially less’ than privately-owned non-quoted companies (John Asker, Joan Farre-Mensa, and Alexander Ljungqvist did a study). But other studies claim that there is no such evidence.

Andy Haldane, the chief economist at the Bank of England, is more convinced.  Haldane has often been ‘off message’ when it comes to defending capitalism, particularly finance capital (see my post,, going so far as to suggest that the financial sector creates no value at all for the wider economy.  Now in a recent TV interview, he argues that firms are “too short-termist, are not spending enough on investment, are returning far too much money to  shareholders, and that we should consider alternative forms of corporate governance to make sure that the wider social good is served.”

Will Hutton, the promoter of an ‘inclusive capitalism’ (see my post, that aims to ‘meet the needs of people not speculation’ (an oxymoron, in my view), was quick to latch onto Clinton’s sound bite.  “The market is hopelessly inefficient, greedy and myopic.” Hutton tells us. “Far from market efficiency, the whole system is undermining the legitimacy of capitalism”

Yes, indeed, the legitimacy of capitalism as a productive form of economic organisation is under question.  But Hutton provides a way out.  For him, short termism and financial speculation are products of a deregulated, neoliberal ‘Anglo-American’ model of capitalism. Does that mean there are other more inclusive and productive models that presumably avoid short termism and financial crashes.  What could they be?  Surely not the social welfare model of Europe that has been crushed by the banking scandals there and the subsequent depression?  Or the Japanese corporate capitalist model with its close connections between politicians, the state, the banks and the large corporations that has seen 20 years of stagnation?

Nevertheless, Hutton gushes at Clinton’s radical move.  “She does not want to reinvent the public limited company, but she proposed the most far-reaching tax reforms of any Democrat presidential nominee to change the incentives for shareholders and executives alike.  In American terms, this is a revolution.  It is long overdue and the argument is beginning to get traction in the US.”

But tapering capital gains tax according to the length of holding a share – is that revolutionary?  Actually, it is more likely the Clinton scheme will simply increase profits for long-term shareholders (pension funds) at the expense of short-term holders (hedge funds).  That may even increase the share of capital income going to the top 1%.

The campaign against short-termism is really a diversion from recognising that there is a failure in the capitalist mode of production.  Instead, let’s look for the blame on ‘speculation’ and a bias towards a quick buck.  The fallacy in this argument is that speculation and short termism has always been part of the capitalist accumulation process.  The question is why it is worse now – if it is.

The answer might lie in the failure of the productive sector of capital to deliver high or even rising profitability, thus pushing corporations, banks and investors to speculate in financial assets (fictitious capital) to counteract. The evidence for this is much stronger than the evidence of ‘short-termism’.  See my post,

And compare the rise in financial profits as a share of total corporate profits.  Corporations have been following the money.
US share of financial profits

Although, since the global financial crash, the share of financial profits in total US corporate profits has fallen back.

Monday, July 27, 2015

Racists intimidate and threaten black family at child's birthday party

by Richard Mellor
Afscme Local 444, retired

Look at these fascists turning up at a black child's birthday party and they were armed. The cops according to what I read, say they never arrested anyone because they never saw any laws being broken. When has that ever stopped cops arresting people they want to arrest?

I have to say that what has to happen to stop these racists is that we have to turn up thousands of people and ensure they can't spread their racist crap or feel safe showing themselves like this. What's happened here is that the refusal of black folks to go along with this crap as well as forcing the removal of their racist symbol from public spaces is that it is forcing these racists more in to the open, they feel compelled to defend their racist views.

And my last comment. Shame on the heads of organized labor whose deafening silence on these issues is shameful and nothing less than criminal.  There are State labor bodies in SC and no doubt in Georgia. But most of all, nationally, the labor movement has huge resources including money, structure and members. These white racists are harmful to the workers movement as well. They are the enemies of all of us and the labor movement in particular should be mobilized against them.  Workers, the poor, communities of color can't rely on the police to protect us from these racists. Broad, multi-racial defense bodies must be built in the working class communities that are ready to turn up with a massive show of strength when these pigs dare to show their faces.

Here is the report from the Atlanta Journal  Constitution.

Melissa Alford says videos show the aftermath of an ugly incident — a convoy of Confederate flag-bearing pickup trucks and their passengers interrupting a black child’s birthday party with threats and racial epithets.

Levi Bush, who was driving one of the trucks, says the videos show the unfortunate ending of an unintentional encounter — one triggered, in fact, by the people at that birthday party.
Whatever they show, the two cellphone videos from the Saturday afternoon incident off Douglasville’s Chapel Hill Road have been seen more than 200,000 times on Facebook. Authorities are now reviewing them to see if anything criminal occurred.

“Officers on scene were given conflicting statements as to what led up to the confrontation,” the Douglasville Police Department said in an emailed statement.

In one of the videos, Douglasville officers can be seen holding back a group of black men and women as at least seven pickup trucks drive off. The trucks’ white passengers wave as the Confederate, American and military flags mounted on the vehicles flap in the air.

“This is a child’s birthday party,” one woman in the crowd can be heard saying.
A second video shows the trucks gathered on a grassy area, and at least one racial slur can be heard. Alford, the woman hosting a family member’s birthday party, said the trucks drove by several times before parking in the field next to her house.

“One had a gun, saying he was gonna kill the [racial slur],” Alford told The Atlanta Journal-Constitution. “Then one of them said gimme the gun, I’ll shoot them [racial slur].”
Bush, the leader of the caravan of trucks, told the AJC that his group is called “Protect the Flag” and is not a hateful one. They “drive around and sell flags,” he said, with all of the proceeds going to veterans or toward purchasing new American flags for those in need.

Bush said his group was leaving a nearby event when they drove by Alford’s home and the partygoers started yelling at the trucks in front of him. They then threw rocks at his vehicle, he said.
Bush said he fishtailed while trying to drive away, then ran over a median and got a flat tire. When he pulled into a nearby driveway, the partygoers swarmed and made threats, and his friends backed him up, he said.

“Basically about eight of us had to hold 15 to 20 of them back,” Bush said, admitting that a specific racial slur was likely used by members of his group.

Someone called 911 and police eventually arrived to separate the factions. Authorities said neither side claimed anything physical took place, and no injuries were reported. They are now reviewing videos to “see if any criminal activity occurred.”

Alford said she doesn’t care if people want to “ride around with their flags,” but said the incident went too far. She said she hasn’t stayed at her home since the incident.

“I don’t have a problem if that’s their culture,” Alford said. “… If they want to make a statement that these flags mean something to them, I’m OK with that. But you’ve got to do it right. You can’t go around just blatantly terrorizing people.”

The US Health Care Industry is Sick.

By Richard Mellor
Afscme Local 444, retired

The sickness industrial complex is a very lucrative business in the US.  One of the more successful aspects of it is the hedge fund industry. Needless to say, this industry has nothing at all to do with the kind of hedges that surround a rural field or garden although it is a structure.  “A hedge fund is a investment vehicle and a business structure that pools capital from a number of investors and invests in securities and other instruments.”, according to Wikipedia.
In other words, a hedge fund is a vehicle created to allow owners of capital to earn profits and accumulate more capital. It’s how people get rich as opposed to performing socially useful labor.  Hedge funds cannot be bought by the general public, only by certain “sophisticated” investors.  From what this layperson can determine, they are not regulated or open to any serious oversight by the general public and generally exist under the radar. As of 2009, the global hedge fund industry was worth $2.4 trillion.

But it’s not just the investors that make money. There are others with their grubby little hands in the game. These characters are driving another vehicle of sorts called Capital Management firms. Pretty simple really, they manage capital for those whose existence is based on it as opposed to wage labor.  For their work, which is to ensure the capital employed in these funds returns cash to the investor over and above their outlay, the investor is charged an annual fee of around 2% of the funds net asset value. Then there is a performance fee which is around 20% of annual profits earned but can be as high as 50%.

On top of this, any savvy investor must surely hire a Risk Management firm or risk management strategists that study and advise on the safety of the investments.  Hundreds of thousands of people are employed in this industry, the goal of which is to protect profits for owners of capital.  One can only imagine how different society would be if such human talent and energy were employed in ensuring society functioned in a humane way in harmony with the natural world, in other words, if the capital/wealth that is created by human labor power in use and appropriated by capitalists was allocated on the basis of human need.We would actually have a real health care system.

Glenview Capital Management is one of these firms that hit it big by investing in the sickness industrial complex like hospitals and insurance companies.  Through the combination of all those things that lead a gambler to make the right bet, GCM figured Obama’s health care plan would lead to some profit taking and bet on it.  The decision brought $3.2 billion in to GCM’s coffers over the last for years according to securities filings and reported in the Wall Street Journal.
Robbins, sickness is good to him

Larry Robbins, the Gomer Pyle look alike who heads Glenview Capital Management is worth some $2.2 billion according to Forbes. And as always, Forbes describes these billionaires wealth as being “self made”.  He has made a lot of money betting on hospital stocks and such and naturally, it will be almost impossible to discover who those lucky individuals might be that have profited from gambling on the sickness industry.  It is true that institutions like pension funds also invest in these instruments but that is no way to provide the means needed to live a decent life in retirement for working class people.
In 2009, in the midst of the Great Recession when people were losing their homes and their jobs and while 2.7 million people lost their private health care coverage, the nations five largest for-profit insurers made a combined profit of $12.2 billion.

Russell Andrews, a neurosurgeon and author of Too Big To Succeed says that it’s the rapacious striving for profits that has made US health care so expensive, (as opposed to incorrigable patients who visit the emergency room for a cut finger which is what we are led to believe to a great extent.) The “….morphing of American medicine from a function of a humanitarian society into a revenue stream for healthcare profits, drug and medical device companies, hospitals, and insurance companies.  In essence, we have transformed healthcare in the U.S. into an industry whose goal is to be profitable.” . Andrews refers to the for profit health care system in the US as a “virus” infecting the system. I would add that it is the profit system, or capitalism that is infects human society in general. (I have not read this book but found this reference to it in a review of two books on the subject at
I have to laugh at this comment from the author at Forbes who writes, I think these well-intentioned physicians are conflating interest in making money with the pursuit of profits.”   The author assails greedy CEO’s in the health care industry which is an issue but clearly doesn’t understand the motive behind the struggle for profits. Workers work for wages; we sell our labor power to the owner(s) of capital. A capitalist’s wealth arises from the buying of labor power directly or indirectly through investments.

The main thing is that the bottom line should not be profits, but that profits should not enter in to it. Health care should not be a business but a social service that is a right in any civilized society.

Sunday, July 26, 2015

Sandra Bland speaks in her last video

Richard Mellor
Afscme Local 444, retired

"You can't have capitalism without racism"  
Malcolm X

If you haven't seen this last video from Sandra Bland take the time to watch it.  What a compliment to her this video is.  The intensity in her face as she is struggling to get her message across and no doubt contain the righteous anger every black person must have over this racist system we live in and what this means for people of her background. As she says in this video with regard to the Walter Scott murder who was shot 8 times in the back as he was running away form a cop, what if it was your uncle. And it's almost a daily occurrence.

The almost daily killing of black people by the police is a national disgrace of catastrophic proportions. White workers cannot be silent about this.  The crisis in the urban ghettos, the catastrophic result of drug addiction and incarceration of blacks and people of color in general and the results of 300 years of slavery, a system in which a worker receives no wages and has no more rights than a chair or a horse that someone owns these are all connected. This section of the population was caste outside of society devoid of all rights given to even the poorest white male and also unable to amass capital to any serious extent.

It's insulting to tell black folk to "get over slavery" because the situation they are in today almost 150 years after it was "officially" ended is a direct result of it and the terror that followed reconstruction. Emmet Till was murdered in my lifetime.

I worked with a lot of African Americans and have some close friends and relatives from this community.  The comment that Sandra makes above about believing that she would have to marry a white, (or light skinned man) to have "pretty" children struck home with me.  I have a good friend of mine, a black woman who once told me the same thing, she was dark skinned and used to say she was "straight up black". It's not just that they would be pretty but they would have more opportunity to escape a life of poverty; they were right.  Imagine that, imagine what society has done to someone to make them feel that way about their appearance and their position in society and themselves as human beings.  It's the same forces that convince women they need the approval of a man when it comes to what beauty is. We all experience this type of oppression as workers, but we don't all experience it as a result of our skin tone.  I remember first reading the Autobiography of Malcolm X and he described the certain hairstyles and appearance he took up to appear more acceptable to white society, I never forgot it.  Look at all the movies and TV shows that only changed to any extent at all after the Civil Rights movement.

And we wonder why black is beautiful or the black power slogan developed. It arose as a response to living is one of the most vicious racist societies in history. It was a defense against an assault.

One of my best friends and solid union fighters I have known I first met as we were sitting in a dump truck during a lunch break at work. I was talking about socialism and class struggles and this sort of stuff. He then says to me, "What about this. What can socialism do about this?", pointing to his watch I thought.  He could see I wasn't sure what he meant, "What have you got to say about black?" he said.

Lets consider what we might be thinking if white people were being incarcerated and killed daily at the same rate. The country would be in a state of national emergency if it was the case. And please don't give me that line about blacks killing blacks and cops kill white people too, don't start with blaming the victim and then wonder why your racial motives are questioned.

I know as Sandra says above, that all white people are not racists and that many of them, I would add that more than people think, are not happy with the state violence directed at African Americans and also the social conditions of the black working class that is undoubtedly a direct result of a racist society. But it's not enough to feel silently supportive, we must speak out and condemn racism in the most forceful way. We must validate their world. The numerous surveys on social and political issues that always have this big gap between blacks and whites, is not complicated, they have different experiences, society treats them differently.

As she says in this last video, it is a social issue, society treats people with white skin differently. Hell, it treats me differently having an English accent, it's fared me well with cops when I've been in dodgy situations and I can see how people give me an ear or some respect because of it. Women have a similar complaint that their opinions are not taken as seriously as a mans generally. These issues are first and foremost social issues.

I am very proud that the union I was a member of took up these issues strongly when I raised them. Most of the members that were in the meeting the night my local supported the rights of the attackers of Reginald Denny who were facing a racist judicial system were white workers.  But the vast majority of us are far to quiet on this issue. 

I look and listen to this woman above and she is a beautiful woman, an intelligent woman, a woman that has no hate in her but is confronting a hateful and dehumanizing system and that system took her life. In all my years I never had one black co-worker expect that I should give something up to make up for slavery or racism. I never had one black co-worker expect me or any white worker to take turns at being poor now or give up my job so that an African American could have one. Workers, no matter what their color or race, have a lot more class consciousness than that.  There are a few excepts, people that want to climb the social ladder who will ingratiate themselves with racists if need be as they attack white workers, but these are rare and all groups have them

All the many African Americans I have known simply demanded, like most workers, to be treated equally and to be judged on their merits. It's an incredible insult to the people we live and work with when we refuse to validate their general concerns about society.

It is a very easy to overcome the tension that is always there in society, a tension that is imposed form without, that serves only the interests of the white ruling class, and that is to speak out openly against racism, condemn it and the history of it in this country, most importantly, the centuries old assault on African people.  Accepting that society treats white skinned people differently does not hurt us, it is a recognition of what is. And it is not because the 1% like us more or because we are the same "race" because color was not a race until the ruling class of this country made it so; ask the Irish who suffered under English rule.  Things have changed the 42 years I have been in this country, there is more intermarriage, more of us working together, but we cannot know those we don't socialize with, eat with, drink with. The bosses will not allow such interactions to take place in the workplace because racism is useful to them in the long run.

Blacks know that that the ancestors of the European population were poor, that they suffered, that in some cases in the Southern Apartheid system they could be worse of than slaves as slaves were more valuable.  But the isolation of the black population from society and their brutal treatment is special. All they demand from us is solidarity and for us to join with them in their struggle against racism and all forms of oppression. It's a simple as that. Being silent, including not challenging other whites who blame black folks for the conditions not of their own making, won't do.

Grexit, De Long and the wages of Sinn

by Michael Roberts

Now that the dust has settled (for a while) in Greece, mainstream economics has been reconsidering what went wrong with Greece and what the best solution would have been.  And it now it seems that both main wings of the mainstream: neoclassical, neoliberal Austerians on one side; and Keynesian on the other side, agree.  Grexit would have been and still is the best solution.

Leading American Keynesian Brad de Long has joined Paul Krugman and Joseph Stiglitz to argue that Grexit is the cheaper option for the Greeks (

De Long is just amazed and shocked that the Euro leaders continue to demand austerity and commitment to Euro rules when it was clearly not working.  It was irrational.  “Because the North Atlantic had lived through the 1930s, I would say, this time we will not make the same mistakes policymakers made in the 1930s. This time we will make our own, different–and hopefully lesser–mistakes. I was wrong. The eurozone is making the mistakes of the 1930s once again. And it is on the point of making them in a more brutal, more exaggerated, and more persistent form than they were made back in the 1930s.  But I did not see that coming. And so, when the Greek debt crisis emerged in 2010, it seemed to me that because the lessons of history were so obvious, the path to the Greek crisis’s resolution would be straightforward.”

What idiots the Euro leaders were and are.  Surely they should have seen that they would need to “offer Greece enough aid, support, additional money, debt write downs, and debt reschedulings to make Greece better off by staying in the eurozone than it would have been if it had exited, depreciated, defaulted, and restructured back in 2010”?

This is what ex-finance minister Varoufakis and PM Tsipras leading the Greek government were hoping or expecting when they negotiated with the Troika.  As Varoufakis explained his strategy: “a Marxist analysis of both European capitalism and of the Left’s current condition compels us to work towards a broad coalition, even with right-wingers, the purpose of which ought to be the resolution of the Eurozone crisis and the stabilisation of the European Union… Ironically, those of us who loathe the Eurozone have a moral obligation to save it!”

But, as De Long says, “that did not happen”.  So now, says De Long, Grexit is the only way out.  And he cites the apparent success of Iceland, a very small country that is not even in the EU, let alone the Eurozone, and thus was able to devalue and default to solve its debt crisis and is now racing towards prosperity.  “Just look at the relative degree of recovery–essentially complete, and none–in Iceland and Greece, respectively.”  

Really?  Iceland is continually served up by the Keynesians as the model for resolving the debt crisis and the depression that Greece is suffering.  But it is a Nordic myth, as I have explained in several posts.

This story of default and devaluation is just not true. Iceland did not renege on the huge debts that its corrupt banks ran up with foreign institutions (mainly the UK and the Netherlands). It eventually renegotiated them and is now paying them back, like Greece. And devaluation did not mean that Icelanders escaped from a huge loss in living standards. They have done better than the Greeks on that score – but Icelanders started from a much higher standard of living than the Greeks. Even so, in euro terms, Icelandic employee real incomes fell 50% and are still 25% below pre-crisis levels.
Yes, Iceland did nationalise its banks but then privatised them again in record time. Two out of the three collapsed major banks in Iceland are now owned by their creditors, not the state. The third bank, Landsbanki, is still nationalised but that’s solely because of ongoing court cases involving Icesave.  Most of the creditors actually sold their stakes onto foreign hedge funds.  Some of the bankrupt banks only remained in government control for a few weeks.  SPRON, for example, was merged into Arion Bank which in turn was given to its creditors a few weeks later, essentially a free gift to Kaupthing’s foreign creditors.

Iceland’s lauded recovery model involving devaluation of its currency was coupled with capital controls.  And these remain a serious drag on investment for the capitalist sector.   Iceland is growing at 2% a year, faster than much of Europe. But the IMF had originally forecast annual growth of around 4.5% from 2011-2013.

Many Icelanders say they do not ‘feel’ this modest growth. Outside booming fishing and tourism, businesses complain of stagnation.  Some 80% of households are swamped in housing loan debts indexed to inflation. Investment is under 15% of GDP, a record low. Real incomes have dropped sharply for Icelandic households as their mortgage debt is index-linked to inflation.
Iceland real income
And it is not true that through default and devaluation, Icelanders avoided the impact of austerity.  Look at this chart of the degree of change in the budget balance before interest costs as a % of national GDPs made by governments globally between 2009 and 2014. Greece leads the way in the degree of austerity.  But look which country is second: Iceland.
Iceland austerity
Brad de Long now reckons that the cost to the Greek economy of Grexit would be much lower than “the long-run costs of remaining in the eurozone given the required austerity now on offer from Brussels and Frankfurt.”  That may be right, but the example of Iceland does not confirm it.
And neither does the traditional explanation of the Greek depression that comes from Keynesians: too much austerity.  De Long says that “the key reason for the failure of forecasts is, of course, Brussels’s and Frankfurt’s–and Washington’s, both at the IMF and in the Obama administration–underestimate of the simple Keynesian multiplier at the zero lower bound on interest rates.”

Well, the ‘simple Keynesian multiplier’ measures the increase in real GDP growth that comes from a unit increase in government spending. But the evidence that this is decisive is not clear – see my post, .

Moreover, I have shown in previous posts that the impact of austerity on growth in Greece and elsewhere is way less than the impact of the collapse in capitalist investment due to low profitability and high corporate and public sector debt.  As Frances Coppola recently put it,  “the story of the Greek crisis is not really one of fiscal profligacy resulting in a “sudden stop”. It is one of PRIVATE sector profligacy fuelled by rising external debt, itself resulting from (or caused by) falling competitiveness.”

The Marxist multiplier measures the amount of economic growth engendered by investment in the capitalist sector and thus by each unit of extra profitability (see my post,

Greek capitalism took the biggest hit to profitability from the Great Recession and its profitability has recovered the least. In contrast, Ireland suffered the least of three economies below, and recovered profitability the most (although it is still down on its peak).  And this is reflected in economic growth.  This explains Greece’s worse position, not austerity as such or the failure to devalue.
Profitability change
Nevertheless, De Long continues to be amazed at the stupidity of the Euro leaders and the Austerians: “So why have we not learned from our history? I still rub my eyes in amazement: I would have thought that the Great Depression was a salient enough event in European history that we would not be making the same mistakes, exactly, again–and right now it looks like in what will turn out to be a more extreme way.”

Well, now it seems that the Austerians are not so stupid because they agree that the Greek government should opt for Grexit too.  German finance minister, Wolfgang Schauble, during the tortuous negotiations on the ‘bailout package’ with Greece, apparently offered a deal to Varoufakis to stump up €50bn in ‘aid’ if the Greeks opted to exit the Eurozone.

And leading German Austerian economist and spokesman for the German Eurosceptic party, the AfD, Dr Werner Sinn agrees. “There are not many issues on which I agree with my colleagues Paul Krugman and Joseph E. Stiglitz and the former Greek finance minister Yanis Varoufakis. But one of them is the view that an exit from the eurozone would be advisable for Greece.”

Echoing the likes of Krugman and De Long, Sinn reckons that Greece needs to devalue and this cannot be done successfully by ‘internal devaluation’ ie cutting wages and prices as the current Troika measures are trying to do. “The public credit has delayed a Greek bankruptcy, but it has failed to revitalize the Greek economy. To compete, Greece needs a strong devaluation — a relative decline of its price level. Trying to lower prices and wages in absolute terms (for example, by slashing wages) would be very difficult, as it would bankrupt many debtors and tenants.”

For Sinn, the Keynesian solution won’t work, not because the Keynesians advocate devaluation of the Greek currency to make Greek capitalism competitive, but because they also want to increase public spending.  “What about the solution favored by leftists: more money for Greece? No doubt, enormous government spending would bring about a Keynesian stimulus and generate some modest internal growth. However, apart from the fact that this money would have to come from other countries’ taxpayers, this would be counterproductive, as it would prevent the necessary devaluation of an overpriced economy and keep wages and prices above the competitive level.”

That’s why, for Sinn, Grexit would only work if it makes the Greek capitalist sector profitable and more competitive (at the expense of labour).  Here Sinn spells out the perfectly rational logic of austerity that De Long and the Keynesians fail to understand.  Austerity is not just some stupid ideological prejudice on the part of the likes of Schauble and Sinn (although it may be that too), it is a solution aiming to restore the profitability of Greek capital, just as it offered for other capitalist economies in this depression.  See my post

Sinn offers not the example of Iceland, as the Keynesians do, but the example of Ireland: “The Irish tightened their belts and underwent a drastic internal devaluation by cutting wages, which in turn led to lower prices for Irish goods both in absolute and relative terms. This made the Irish economy competitive again.”  And they sure did ‘tighten their belts’.  In my graph above of changes in government budgets since 2009, Ireland comes next after Greece and Iceland. Indeed, see Michael Taft’s excellent article on the Irish model for Greece:

Sinn also neglects to mention that the main reason that Ireland has become competitive has been the mass emigration of the labour force and the special tax conditions provided by Irish governments for American multi-nationals to operate there.  Irish emigration is now back at levels not seen since the dark days of late 1980s.
irish emigration
It is the same story with Estonia, another example of successful ‘austerity’ and now, of course, in Greece, Spain and Portugal.  The Austerians rest their claims for recovery for these weak capitalist economies on huge reductions in wages and conditions for labour, massive cutbacks in public spending and mass emigration.  All this is to restore the profitability of the capitalist sector.

But, it seems that Sinn and others now reckon that the policies of austerity alone will not be enough to get Greek capitalism back on its feet, however, tottering.  Better now that Greece leaves, devalues its drachma and then carries through austerity measures.  “Greece would have the option to return to the eurozone, at a new exchange rate, after carrying out institutional reforms — such as public recording of land purchases, functioning tax collection, accurate statistical reporting — and meeting the normal conditions for eurozone membership. It could take five or 10 years.”

For as Sinn puts it, “Until Europe is turned into a federal state — as it should become, at some point — it will not have a currency like the dollar. Until then, what is needed is a “breathing” currency union, with orderly entry and exit options, coupled with an insolvency rule for member states.”

So there we have it.  The Keynesians say the way forward is through Grexit and so now do many Austerians.  Both see Grexit as a solution to save Greek capitalism. The Keynesians reckon it will ‘free’ Greek capitalism from austerity. The Austerians reckon it will ‘free’ the Euro leaders from the wasted funding of a failing capitalist economy.  But neither side is right if the profitability of capital does not recover in Greece and in Europe.

Saturday, July 25, 2015

Amara Enyia on Sandra Bland's death

by Richard Mellor
Afscme Local 444, retired

As I watched the dashcam video of Sandra Bland's unfortunate encounter with an armed representative of the state I felt a combination of anger and frustration, not at the same level as she felt it perhaps but it engulfed me for a moment. I am not naive, I think there are many, many people from all of the different communities in America who felt the same way. You'd have to have lost your humanity not to. This country is crying out for a broad based movement against the system and its defenders.

After about 25 minutes of the video I'd had enough. Some readers might not believe me, I am after all, a white skinned,  European American male with and English accent and a GED after all., surely it doesn't affect me. 

A policeman can be a complete moron but this is an individual with the power of life and death over you. The police, particularly here in the US, have a lot of power. They only have to say they feel threatened or that their life is in danger and you're a gonner. This is particularly the case with black folks, you'd have to be blind not to see this. The most important aspect of your blindness is a refusal to recognize that you live in a society in which racial discrimination is institutionalized and that the system was built on it; it treats people differently.  Capitalism exploits all workers, white workers included, but women, racial or religious minorities and in particular people of African descent, have to deal with added discrimination and the poor of any group are at the bottom of the heap because if you are poor in capitalist society you only have yourself to blame. Leaving aside the genocidal war against the native population of this land, the most brutal offensive has been against those with black skin. It has been the most successful method of dividing the working class here and has hurt us all.

I had an experience with cops when I first came to America  that really brought this home to me. If I had been black I could have been dead or at very least in jail.  I recognized early on that my English accent was overwhelmingly a plus. That cop would not have treated me the way he did Sandra Bland. This does not make me a bad person, a racist or anything else. I need not feel guilty about it, and I don't. I leave that to the white middle class liberals and some elements on the left.  But if I were to deny it, I would be as guilty as the cop.

Sandra, was black and a woman, and as far as I know she was from the working class as well. That fateful day she came up against the front line of the forces that perpetuate a class based racist and  sexist system and it cost her her life. She was an intelligent person approached by an imbecile with power. As I shared her frustration it reminded me of my childhood. My father was physically abusive to me and mentally so to my mother. (He believed you shouldn't hit a woman but you could make them a non person) In my child's mind it was the sheer power of him, the inability of me to do anything about it that frustrated me the most, the beating was easier to handle than the frustration and sense of weakness I felt.

Don't let anyone speak ill of Sandra Bland and other victims of power in front of you, don't let them blame the victim which has been the standard excuse in response to domestic violence claims, "If only she'd stop nagging". If Sandra Bland's attitude was less than cheerful, so what, and all this for a lane change violation?   Listen to the tape of her speaking on a phone call from jail.   As a human being you will identify with her frustration.