There I was, reading a column by the New Yorker's James Sourkraut, about who precisely oughta be afraid of the big bad wolf called moral hazard

— and it's just rolling along in the usual commonplace fashion when this pops up:

“The moral-hazard argument — assumes that the most important factor shaping corporate decisions is the interest of the company as a whole. But, more often, what’s shaping those decisions is the interest of individuals…. The fact that people can reap enormous [personal] rewards… is likely to lead to [more] reckless behavior, regardless of whether companies are bailed out or not…. Even if we allow Citigroup to fail… Chuck Prince, the former C.E.O., will still have walked away with a package reportedly worth more than seventy million dollars.”

So what else can we do, then?

Well, for starters, these Chucky Prince critters,
prolly already planning their next scamarama,

can be rounded up,

branded on the forehead,

and slung into a detention center.

That's what.

Possible site?
I suggest inside the 9/11 crater,

right there in lower Manhattan.

I'm thinking of maybe a system of all-glass cages,

suspended

from a pair of gleeming steel trade-tower sized armatures,

Calderesque fashion.

You know,

let the fuckers twist up there

in the trade winds, so to speak.

Glitter and rattle away like obscene chimes
day and night.

Inside each cage a financial Houdini,

all of 'em gyre-ing about

like a flock of secular Simeon Styliteses.

If we were to consult a good constitutional scholar on this,
I'll bet my trust fund

we'll be told

the power to do such noble deeds

rests comfortably within the scope

of our federal House of Representatives.

I can see it now:
la Nan sets up a special task force

“to investigate the Wall Street debacle,”

Pujo Committee style.

…… yaa i like that..

one of those “never again” type scrambles.

A viciously seductive she-cat
can be appointed to head up the staff

of crack investigators

— let's think Vishinsky in a tank top —-

Provisional lists can be drawn
— long and grossly unfair lists —

regrettably,
in the frenzy to mete out a higher justice,

very few innocent assholes

with even a remote connection to “the Street”

are spared.

Much too much is leaked to the press
before a wave of belated decency arrives,

and the list is winnowed from tens of thousands

to it's final “minimalist” tally

of three hundred putrid souls.

Of course, these despicable,
final cut fiends

— many of them at any rate —

will take flight,

but just as often they'll be apprehended,

Ninja style —

plucked like wood lice

from their places of betrayed hiding.

Some, alas, will die along the way
— manhunts are like that —

a few will be fired apon while fleeing

others will doubtless die by their own hand

hopefully, in a few totally unsavory cases,
prior to giving their testimony before the sub committee.

—-let us pray —

there will be secret waterboarding,

and that full truths will be extracted,

and these egregious toads

will each tell their heinous tale in full

from a prepared script

—I imagine this oughta be the work

of a team of the finest writers known to the DNC—

And then there's the recitations themselves.
the spot light moment

for each of the fallen bastards 

— battered, unshaven, beltless,

stumbling and mumbling and staring vacantly about them —

each moaning out his own individual story,

all in a weird lock step.

comrades, the effect will be a miracle

the whole world will be watching
gasping, fuming, gnashing, weeping;

a hardcore 50 million of em
drunk with an unquenchable rage

will storm their nearest ATM machines

and well…

— there's enough potential zip zap here —

to begin the world anew!

Posted by pinky at 02:06 AM

Beware this creep, Jeffrey Sachs, the Quetelet Professor of Sustainable Development at Columbia University.

He is a vicious climbing grasping sanctimonious hollow pine of a grifter, the Geraldo Rivera of development economics, a lamp unto himself alone, a scorpion fire, a sickening soul, a blemish on shame itself.

Once Doctor Shock to both Poland and Bolivia, the smiley face of raw neolib market stampedes bringing a misery worthy of the four horsemen in his wake…
he's now Doctor African Makeover,

the white rain man wretched sub-Saharan black folks

never asked for,

but got ..and right up their ass.

In the last decade,
this trans-nat limited-liability

emerging-economy death-wish incarnate,

despite heading for deep cover

as a champion of the poorest of the global poor,

remains nothing but a babyfaced corporate pimp,

ready to facilitate the free range profiteers

and various other serial rapists

in one backward nation after another.

I'll not trouble you with the details.
Just never read a word he writes

or believe anything he claims.

If he said horse jockeys oughta all be over 7 feet tall,

he couldn't get himself one inch further from the truth

than he is right now, 24/7.

This undauntable guy's ever-boring, ever-ready ambition
will never give up the hustle.

His foul spirit wants in on everything,

and he'll get in on everything too,

if he ain't sent rocketing down to the circle of Hell

reserved for oily human corkscrews like him.

On the other hand, this shrewd witty chap —

… Dani Rodrik, despite — or more likey because of — an odd Sancho as Quixote side, must have a place waiting for him somewhere up there in God's own sugar bowl.

I quote from a recent light and popular advice piece of his,
intended for the same array of emerging states

the above Sachs man has tried poisoning,

states now obviously confronting

a fast submerging “order” here on market Earth:

“First on the agenda must be new rules that make financial crises less likely and their consequences less severe.Left to their own devices, global financial markets provide too much credit at too cheap a price in good times, while they deliver too little credit at bad times. The only effective response is counter-cyclical capital-account management. — discouraging foreign borrowing in good times, and preventing capital flight in bad. ”

This reads to me like Clausewitz on war
— splendid fast volley after volley,

all forehand overhead smashes…..

But soft! Here entereth the villain —

“Instead of frowning on capital controls
and pushing for financial openness,

the IMF

should be in the business of actively helping countries
implement such policies.

It should also enlarge its emergency credit lines

to act more as a lender of last resort

to developing nations hit by financial whiplash. ”

—Note the pair of 'shoulds' hurled at our bogeyman, the hated IMF — that's merely a respectable academic's way of saying “won't happen, of course it won't
its the IMF stupid .” ——

“Second, the crisis is an opportunity for achieving greater transparency on all fronts, including banking practices in the advanced countries that facilitate tax evasion in the developing nations. Wealthy citizens in the developing world evade more than a hundred billion of US dollars worth of taxes in their home countries each year thanks to bank accounts they maintain in Zurich, Miami, London, and elsewhere. Governments of these nations should ask for and be given information on their nationals’ accounts.”

—And my dog Willy
should live longer then me, God bless him,

but….—-

“Third, developing nations should also push for a Tobin tax (**) – a tax on global foreign currency transactions. Set at a small enough level – say 0.25% – such a tax would have little adverse effect on the global economy while raising considerable amount of revenue. At worst the efficiency costs would be minor; at best the tax would discourage excessive short-term speculation. The revenues collected – which would easily amount to hundreds of billions of US dollars annually – could be spent on global public goods such as development assistance, vaccines for tropical diseases, and the greening of technologies in use in the developing world.”

—-Give me a toke on that dream pipe, willya, brother Dan?—-


—————————

(**) While we dream — a Tobin tax rate
might work better

if structured to move up and down dynamically,

like a congestion tax.

Posted by pinky at 01:56 AM

i gotta face it playing lord keynes junior like i have recently 
while sitting in a soft metropolitan chair here

near the city of the bean and the cod

ain't exactly rugged collectivism at its finest eh ???



and i'll confess i like to scrupple myself about this ..well at least once a week ..

every satrurday nite after i've let the three hun amigos out one last time

to lift a hind leg or two and maybe deficate somewhere obvious in the side yard

and after i've recaged the little bastards and i'm back warmly tucked in my midnite bed

domestic partner closely beside me in a fragrant purring sleep

it its my habit no it is my discilpine to set myself this poser:

okay comrade so your party has just seized power …absolute power in..wait for it …

bengladesh…okay wise guy so go make it happen cap'n



ya right not so easy there eh …. scylla and charybdis await me ..one way spells the howling savagery of primitive accumulation

the other the pusilanimous oozy slope to  red corporate comprador

if the choice gets that stark i opt for …

well lets delve in here some first ..

i know no better starting place then…well… give a warm smbiva welcome to

pol pot's larry summers former puppet president of democratic kampuchea presently i believe moldering

in a jail cell awaiting the proceddings of the cambodia tribunal ….

http://en.wikipedia.org/wiki/Cambodia_Tribunal

ladies and gentlemen khieu samphan

http://newsimg.bbc.co.uk/media/images/44237000/jpg/_44237700_khieu_ap203.jpg



his fearless leader mr pot armed with khieu's ” development model”  took the cambo people

to places no radical make over type outfit  dared go

since the early days of thomas munzer and the anabaptists



http://theunexplainedmysteries.com/images/PolPot.jpg





it might be claimed in hind sight

these paris educated boys from the jungles and court palces of combodia

took what we now call anti globalization to its logical conclusion

….well maybe thats a bit unfair… .maybe there are other logical conclusions …but at any rate

this man khieu and thru him party boss pol pot were indeed however just pragmatizing lessons they as students 

learned from the likes of samir amin

http://www.voltairenet.org/IMG/jpg/samir_20amin-copia.jpg

so called “dependency theory “a radical theory  of dissent from the one big market world vision of corporate earth

a theory which doubtless in several forms you've  bump into now and again on your anti empire travels… eh ???

i my self like to think of “dependency theory” as a model or better a cluster of kissin kousin models

of economic globalization as viewed thru the wrong end of ”the system “'s

international sewer pipes



background:



back in the 50's of the last century our man khieu here was an amin acolyte

it was during his university days spent up there at the gallic metropole

in fact mr samphan citizen samphan became doctor samphan

with a dissertaion entitled “Cambodia's Economy and Industrial Development”

its thesis strongly guided by aminite wisdom comes to this :

backward peoples of the world wanna develop your national economy

a pro people way ???? then pull out all the trans nat plugs

yup and he meant or came to mean anyway

pull em out

kold turkey too 

in the event 
come the spring of 1975 —after a few bombs and a scrap or two along the way—-

mr pol and comrade khieu and their fellow posse of rouge bandits entered the bloated phantasm then doing business as lon nol's

pro yankee phnom penh

yes they did indeed set about immediately pulling the plugs
no more dependency for cambodians

no more crumb begging

no more supine cargo culting

no more … well my guess khieu back in paris worked this all out very neatly

just start from the top down lopping off

one layer after another of social hierarchy

until u arrive at some thing remarkably close

to billy bryan's populist insight

about the relative necessity of cities and countryside



conclusion:

once under the sway of ankor cambodia would in effect start from square one

go it all on its own

well square one like all of clio's legacies was a nasty place indeed

to begin the new jerusalem

not just the age old slowly morphing antique parasite city of the sihanouk years

squatting atop …the toiling masses

there now was a frankensteins monster

built out of massive aerial counter insurgence

a hell's kitchen where roughly half the nations population

most fleeing devestation from yankee bombing and

a corrupt faux civil war

now languished in utter depraved uselessness

caught up in an existence restricted to

beggary handling sycophancy

and the dole

i the back alleys of the royal city teemed with a

spirituallu and physically decaying multitude

in the last analysis having survived for years
not off the sweat of their brows

but off the kindness of a stranger named uncle sam

who quite understandably given the utter defeat of his stoogery

had already pulled his plugs including the food plug of course 

— talk about dependency not in theory but in detailed fact —-



so what was to be done ???



“send em all to the countryside to fend for themselves …create a system of volkish communes

and under the guardianship of ankor let the people themselves

with only the means and skills at hand

discover or rediscover the limits and the present possibilities

of living directly off our motherland ”



i suspect your thoughts mightat this point begin to drift towards ned burke

yes okay score one for partial measures approach

here we have its opposite

and indeed there was a darkly bloody

deductive jacobin over soul at work here

just don't get  going too far and
start munching on that aweful romish house lilly of a brit lord acton's crooked meme

sorry absolute power can't corrupt

if its still operating at immediate gun point

then again it can
surely do acton one better

it can kill at will



lets move on ….



——-



returning to the present with its komforting klintonian kompromises



http://stopmebeforeivoteagain.org/2009/02/sachshund.html#comments



speaking of compromise

recently i suggested here that development economist dani rodrick

unlike such dancing death heads as doc sachs might well be one of Clio's goodly social agents

well if that's so i must add it's not because he's a stout battler agin the yankee empire

no  it's just because his heart and his brain are solidly on the side of the emerging world

as evidenced in his three wishes for a reformation of our planetary market order



regretably dani has not nor will he ever i suspect declare jihad agin the rule of the trans nat corporations

nor the essence of their co-joint program to make the whole earth sustainably safe

for their type of free range limited liability adventures in private profit





he instead presents his trilemma



you can't have all three of these goodies brothers and sisters



an open world market

national self determination

and

democracy



you can have any two

but not all three

owens lemma

and sometimes you can have none



re enter bengla desh



to be continued

Posted by pinky at 01:19 AM

a curious commenter has asked your obedient savant manque
to review an article by the appealing epigone of the now dead grand masters of monthly review magazine

paul sweezy and harry magdoff

http://monthlyreview.org/081201foster-magdoff.php

here is my review ….in brief


(note this piece was written back in october

so first  you gotta hack away all the narrative parts

which by now any progressive must know by heart)



the brain at the core is —as might be expected —  old paul s and harry m 's 

theory of ”secular stagnation 2.0 ”



here it is in their acolytes own words :



“.. stagnation ….(is) …the normal state of the monopoly-capitalist economy…

(characterized by ) slow growth … rising excess capacity and unemployment/underemployment..

..the economic surplus controlled by corporations…… (is)…poured in an ever increasing flow

into an exotic array of financial instruments…. Little of the vast economic surplus… (is) ..used to expand investment,

which remains .. geared to mere replacement (albeit with new, enhanced technology),

as opposed to expansion…. . With corporations unable to find the demand for their output

—a reality reflected in the long-run decline of capacity utilization in industry —

and therefore confronted with a dearth of profitable investment opportunities,

the process of net capital formation becomes …more and more problematic.

profits …(are )… increasingly directed away from investment in the expansion of productive capacity

and toward financial speculation “



see its all about …stagnation…. what lies mine-able in a single  word …i guess

for some heads meme troves unlike mines can never be over  worked  eh ???

example:
“Stagnation in the 1970s led capital to launch an accelerated class war against workers

to raise profits by pushing labor costs down. The result was decades of increasing inequality”



“accelerated class war ” i like the sound of that going the other way .. class war is a two way street ..isn't it ???

but seriously folks …where's the whole export of capital import of products gig gone to here ???

global empire trans nat corporate style maybe we are assuming a one world closed system model but if so is stagnation theory able to get its chin over the raised bar ??



i doubt it..but in te spirit of comrades to comrades i'll proceed as if there was only amerika …

first off let my get something cleared up here

i like vintage stuff ..even if its basically patois studded circular isometric gabbling like the following 



“the underlying growth of surplus value falls increasingly short of the rate of accumulation of money capital…

…a shift from the “general formula for capital” M(oney)-C(commodity)–M¢ (original money plus surplus value),

in which commodities were central to the production of profits

—to a system increasingly geared to the circuit of money capital alone, M–M¢,

in which money simply begets more money with no relation to production.”



but for heaven's sake brothers and sisters

why do our authors here use terms like “ surplus value and simple reproduction “  and even more to the point

runic florishes like m-c- =  m c m prime -> hammer + cycle ..etc

what's this pirate code ????

why use stilted running dog terms and notions from the crumbling temples of the marxicon

when we have perfectly good every day street clothed replacements (and with no loss of precision precision?? what precision owen)

especially in a non sectarian periodical aimed at a general progressive readership ????



to me  well…. its no more then clownish mock wizardry worthy of the local shriners club



but back  to the substance of things



“stagnation theory “… okay so we ain't accumulatin' any more …where's the beef ????

maybe  stagnation is good

maybe its part of a better whole

maybe its green

maybe its best .. us advanced systems slow our expansion  new emerging systems speed theirs up 

maybe its the best possible national role we yanks can play in a global process of  multi national convergence 

(oops i went global again…sorry)

or maybe —-as the greens never tire of pointing out to us—-

maybe we don't need no stinking national accumulation round here anymore anyway

maybe all we need is a hyper employment macro policy

which ya i know maybe we don't have

but is that because of stagnation ???



okay indeed its likely if we did  have hyper employment

every day on the job stuff would be quite a different arrangement

then we got now …i mean wages and work would fly up their own ass….

imagine if job offers exceeded job applicants …!!!!!

“hey straw boss take this three penny opera of a job and shove it ..”…

at any rate here's little mag and foster's take away :



” Our argument in a nutshell is that both

the financial explosion in recent decades

and the financial implosion now taking place

are to be explained mainly in reference to stagnation tendencies

within the underlying economy…. a real economy experiencing slower growth,

giving rise to financial explosion

as capital seeks to “leverage” its way out of the problem

by expanding debt and gaining speculative profits

…The overall effect has been a massive increase

in private debt relative to national income…”



okay and ummm err i guess that's a no no ..leverage i mean …and because…..

well eventually the equity margin gets to be too thin a membrane and come a few bad days at the dice table and pop …

theres of a sudden the  deadly shutter of a proximate system wide credit contraction 



but what if hereth enter irv fisher to play dutch boy stuffing the holes with limitless new and safe uncle securities to shift

private wealth to… but that's only more debt if now public debt and more debt only creates the pre conditions

for a next time debt crisis and that next time eventually must be ”a major crisis of the financial system (which) … “

ta taaaa “..overpowers the lender of last resort “

i repeat the punch line “overpowers the lender of last resort ” ie uncle fed …

parathetically these are almost paul krugman's exact words



“our main line of defense against recessions — the Federal Reserve’s usual ability to support the economy by cutting interest rates — has already been overrun. The Fed has cut the rates it controls basically to zero, yet the economy is still in free fall. “

http://www.nytimes.com/2009/02/06/opinion/06krugman.html?_r=1&partner=permalink&exprod=permalink





well the day of doom sounds and we're off down the rabbit hole we go .. on a now unstoppable fisherian deflation spiral

as  income gets diverted from spending on new products to an attempt to fill in the deepening debt trap prices and wages fall

and since by assumption the trap is deepening faster then we can fill…



the cat chases its own uncatchable tail till it turns itself into a grease spot

in the article's words
“.. the whole precarious financial superstructure .. grown to such a scale

that the means of governmental authorities, though massive,

are no longer sufficient to keep back the avalanche,…”



ya ya ya this amounts to the old maxim there's always a weight too great to hold

but is this really such a gig ???

sure eventually something that keeps getting heavier will …

but this all paper gang what are we talking about ?? it can be rendered weightless if we so desire

an over powered fed ???  because macro policy is suffering what  ..a failure of horse power or just of will power ?

why not a peaceful clever massive fisherian debt restructuring ??

let me indulge some jargonation here …are vital klass interests of the hegemonic class at stake here ??

would a full fisherian fix wreck the main gig … ”over power ” the system's ruling klass ????



okay ghost buster jargonian hiccups like the monstrosity above true or untrue

hardly move us a single centimeter closer to the  answer we need if we want to not just understand but change



question numero uno oughta be :

does this crisis have a solution reachable from inside the system itself ??



let me caution those who say no—- at least a scientific socialist hearty proletarian nyet of a no —-

with the memory of the stinking THIRD PERIOD blooper http://en.wikipedia.org/wiki/Third_Period

don't ever count kong out on his feet





at any rate if despite my caveat you still wanta get intoxicated

on a longer swig of this here back yard still 180 proof histo-mat elixir



feature this :





“Stagnation in the 1970s led capital to launch an accelerated class war against workers

to raise profits by pushing labor costs down. The result was decades of increasing inequality”

and yet

“household consumption continued to rise from a little over 60 percent of GDP in the early 1960s to around 70 percent in 2007.”



“… a constant ratcheting up of consumer debt. Household debt was spurred,

particularly in the later stages of the housing bubble,

by a dramatic rise in housing prices,

allowing consumers to borrow more against their increased equity…

household debt increased from about 40 percent of GDP in 1960

to 100 percent of GDP in 2007”



“The deleveraging of the enormous debt built up during recent decades

is now contributing to a deep crisis.

Moreover, with financialization arrested there is no other visible way out for monopoly-finance capital.

The prognosis then is that the economy, even after the immediate devaluation crisis is stabilized,

will at best be characterized for some time by minimal growth,

and by high unemployment, underemployment, and excess capacity. “

yup aggregate effective demand can be raised by offering jobholders looser bigger credit lines
instead of higher wages only up to a point

push it too far too fast as we've seen recently

base it on a house lot bubble and pop …

in sum if macro policy begins to rely on this method too fully

if it becomes ”.. quantitatively the most important stimulus to demand.

unavoidably..(there will be).. a day of financial reckoning and cascading defaults.”



yes indeed if wages fail to rise fast enough to keep up with  household debt obligations

once the lot ponzi stumbles bingo a crisis

but why can't we inflate our way out of here anymore ??

okay nominal house lot prices must fall but why can't nominal wages rise ???

why can't the ass hole innocent widow and orphan petty rentiers

holding all the old maid inventory of existing dollar debt take the hit ???



so long as  real wages don't rise up to squeeze profit margins

but thats what price increases are for fool 

again we're not talkin real here man we're talkin purely nominal 



but little mag and foster sez

” financialization(their word for the paper pyramid ) is so essential to the monopoly-finance capital of today,
that …a “euthanasia of the rentier” cannot be achieved—

in contravention of Keynes’s dream of a more rational capitalism—without moving beyond the system itself.”



there you have it flat out can't get there from here

at some point like maybe now “the system” becomes incapable of a solution internal to itself

but proof by assertion is for show trails boys

why is this escape hatch not availible ???

why

when the paper pandemonium whurls out of control

instead of letting the system sponaneously try deflating asset prices to conform with product prices and wages

and only send product prices and wages down with em 

why not inflate the product systems prices and wages up to the level of the paper assets ???

what sinister klass forces would scotch this and why ???

rentiers ?? please they are right now taking a thumping already

questions questions questions


instead of answering these obvious questions we get this seductive gibberish



“U.S. financial profits have deviated from the mean over the past decade on a cumulative basis…

The U.S. Financial sector has made around 1.2 Trillion ($1,200bn) of ‘excess’ profits

in the last decade relative to nominal GDP… So mean reversion

[the theory that returns in financial markets over time “revert” to a long-term mean projection, or trend-line]

would suggest that $1.2 trillion of profits need to be wiped out

before the U.S. financial sector can be cleansed of the excesses of the last decade”



i really won't try to untangle it but i smell wagnerian confusions galore here

phantom flows playing the scheinvert villains magic wealth towers taking the rap for

the crimes of stock rings and stock rings playing the police department chasing the phantom flows ….

cats rbark  dogs meow mice roar …the cow jumps over the moon



to be fair much of use can be rescued from this midden heap of marx-think but

my children i grow weary of honest toil so i'll not press on any further right now

i'll just sign off as it were  in media res

with a see you next time compadres

and with a slightly trim-ed up

version of our headliners from the little mag and foster show's

lovely next year in jerusalem type coda

 
“If … elementary prerequisites of any decent future look impossible under the present system,

then the people should take it into their own hands …turn it all inside-out … create a more rational social order.

… …seize control of .. political economy,…replace  the present system of capitalism with …socialism”

Posted by pinky at 01:07 AM