Relevant and even prescient commentary on news, politics and the economy.

Free Trade vs the World Bank

This concept of Comparative Advantage hits a big wall if we accept the World Bank’s study on what generates wealth.

If comparative advantage is about what comes natural to a given nation, it has to include what the study referred to as natural capital. This is only 40% of the wealth generation for a poor nation but drops to 20% for a rich nation and is 5% overall world wide. Produced capital accounts for only 18% world wide.

77% of wealth creation is from “intangible capital”. Intangible capital is the results of societies efforts to improve it’s self as a society (making us better people). It is legal, it is education. It is civil rights, it is (or was here) free education to including college, it is management of our environment, it is (or was) the enlightenment, it is adaptation of knowledge for the betterment of living life. None of these things are the results of nature. They are the results of will and money. The money being spread for the benefit of all.

So, we look at China or India and see that they have taken steps to improve their society via education and legal. The comparative advantage however is still more in the natural capital. What is their “natural” capital? It is low relative wages as compared to the rich nations. Is there any naturally comparative advantage? I think not. It’s not like they are selling us natural resources. What they are selling are the results of moving the know how and productivity generating tools (using a hammer drill to drill a hole in concrete vs a star drill and hammer) to their countries. Their natural capital is in their labor.

This creates a dilemma for the free traders who think it is only a matter of stuff and things in exchange for currency. If 40% of poor nations wealth generation is natural capital, and produced capital is 18% of the wealth generation, then that leaves 42% of China’s wealth generation intangible. This is competing against us with numbers that most likely look closer to the world overall, 5% natural, 18% produced, 77% intangible. Being that our advantage is our society, and our society was created by creating a better distribution of wealth, then how are NAFTA, CAFTA etc. without emphasis on labor, rights, and environment promoting our comparative advantage?

This dilemma of promoting trade agreements on only the 2 tangible sectors of the 3 sectors that drive wealth creation ignoring that a rich country as moved vastly beyond the ratio of the 3 sectors to where investment in ones society is the dominating sector by far, is what is wrong with applying models that discuss comparative advantage as some kind of sliding scale based on only the tangibles. Wine vs wool was it?

We’re loosing the trade wars as a nation because we’re writing trading agreements to our partners advantage. That’s what comes of letting people who only think about business, do the trade agreements. They only think in terms of the natural capital and created capital. It is why the models are wrong when they say there will be or has to be “losers”. Bull crappy on that.

Tags: , , Comments (0) | |

Doing the Economy One Better

Seems there is a movement afoot to do the economy one better. There will be a conference Beyond GDP held in Brussels in November.

GDP is the best-recognised measure of economic performance in the world, often used as a generic indicator of progress. However, the relationship between economic growth as measured by GDP and other dimensions of societal progress is not straightforward. Effectively measuring progress, wealth and well-being requires indices that are as clear and appealing as GDP but more inclusive than GDP—ones that incorporate social and environmental issues. This is especially important given global challenges such as climate change, global poverty, pressure on resources and their potential impact on societies.

The purpose:

The European Commission, European Parliament, Club of Rome, OECD and WWF will host a high-level conference with the objectives of clarifying which indices are most appropriate to measure progress, and how these can best be integrated into the decision-making process and taken up by public debate.

This link is to a list of indicators that are being discussed.

While people look to come up with a better measurement, there is a movement coming to your town that has happened throughout the rest of the world: The Solidarity Economy Network.

The Solidarity Economy offers an alternative economic framework to that of neoliberal globalization – one that is grounded in solidarity and cooperation, rather than the pursuit of narrow, individual self-interest.• It promotes social and economic democracy, equity in all dimensions (e.g. race, class, gender…) and sustainability.• It is pluralist and organic in its approach, allowing for different forms and strategies in different contexts, and is open to continual change driven from the bottom up whether in civil society or the marketplace.

Of course, a move to do the economy one better would not be complete without a discussion of the “corporation”.
There is a Summit at Faneuil Hall, Boston asking: Are Corporations equipped for the 21st century?

The Summit…is inspired by the growing tension between the emergence of the corporation as the world’s most powerful and innovative social institution and the growing severity of social and environmental problems that plague billions of people. As the tension between these two realities grows, the roles, responsibilities and rights of business are the subject of increasing controversy, as are the relationships of the corporation to government and civil society.

The Summit marks an historical moment for considering how the most influential social institution of our time can serve the broader public interest essential to its own long-term prosperity, and to begin designing corporate forms that recognize the reciprocity between private and public interests.

Enjoy.

Tags: , Comments (0) | |

Human capital is where it’s at!

Continuing from my last posting, I stated the World Bank has seen the light. It has put out a report: Where is the Wealth of Nations?
Reason Online has an interview with the prime author Kirk Hamilton.

Oil, soil, copper, and forests are forms of wealth. So are factories, houses, and roads. But according to a 2005 study by the World Bank, such solid goods amount to only about 20 percent of the wealth of rich nations and 40 percent of the wealth of poor countries.

So what accounts for the majority? World Bank environmental economist Kirk Hamilton and his team in the bank’s environment department have found that most of humanity’s wealth isn’t made of physical stuff. It is intangible…Hamilton’s team found that “human capital and the value of institutions (as measured by rule of law) constitute the largest share of wealth in virtually all countries.”

The World Bank study defines natural capital as the sum of cropland, pastureland, forested areas, protected areas, and nonrenewable resources (including oil, natural gas, coal, and minerals). Produced capital is what most of us think of when we think of capital: machinery, equipment, structures (including infrastructure), and urban land. But that still left a lot of wealth to explain. “As soon as you say the issue is the wealth of nations and how wealth is managed, then you realize that if you were only talking about a portfolio of natural assets, if you were only talking about produced capital and natural assets, you’re missing a big chunk of the story,” Hamilton explains.

The rest of the story is intangible capital. That encompasses raw labor; human capital, which includes the sum of a population’s knowledge and skills; and the level of trust in a society and the quality of its formal and informal institutions. Worldwide, the study finds, “natural capital accounts for 5 percent of total wealth, produced capital for 18 percent, and intangible capital 77 percent.”

For under developed or undeveloped countries you can see what direction they have to go in. But what about our country? We have had discussions about infrastructure. We have talked about the need for education. When I skimmed the report (200+ pages), savings was a must in order to be able to invest in the intangible capital. We have debated the share of benefit a person receives from the country’s infrastructure and institutions based on the wealth and/or income they control. We always argue about where growth comes from such that it raise all boats. (Sing that jingle!) And there is the “free market” debate revolving around regulation. Oh that nasty governance issue! If only we hadn’t signed on to form a more perfect union.

My quick assessment of this report is that it is a testament to the misdirection of our policies. We do not make money from money even though we have been trying to. You did catch the reference to “labor”. These breakouts of wealth suggest that there is a bottom limit to taxation as taxation reflects our investment in us. In the study, European countries dominate the top wealth and England is not in the top 10. This report implies that the wealthy do benefit more from the country’s structure and investment because the majority of their wealth is from this “intangible capital”. The few of the wealthy have accumulated their wealth from the investment of the many in the intangible. It also means capital gains should be tax equal to labor if not higher.

Rich countries are largely rich because of the skills of their populations and the quality of the institutions supporting economic activity,” the study concludes. According to Hamilton’s figures, the rule of law explains 57 percent of countries’ intangible capital. Education accounts for 36 percent.

With only 18% of wealth from produced capital and less from natural resources as a country becomes wealthier, freeing up money to produce money as we have been promoting is very poor investment strategy it would seem when 77% of our wealth is from the human element. In a broad sense, we are talking about what ideology concerning the conduct of human life works best to produce wealth.

An economy with a very efficient judicial system, clear and enforceable property rights, and an effective and uncorrupt government will produce higher total wealth. For example, Switzerland scores 99.5 out of 100 on the rule of law index and the U.S. hits 91.8. By contrast, Nigeria gets a score of just 5.8, while the war-torn Democratic Republic of the Congo obtains a miserable 1 out of 100.

It is not just that we need to invest in education,or just have a legal system or just fix the bridges. These can be measured as noted in the World Bank Doing Business chart.

“Trust” seems to be the real intangible the report is talking about. We as a whole can be educated to the hilt, but if we can’t trust that our efforts will be put to constructive use, we have problems. Think habeas corpus, FISA, election fraud, threatening of the press, intimidation of speech, extension of free speech to none human entities, the equating of one voice-one vote to spending of one’s money, K Street project, etc. Think of the use of fear. If only a few are educated to the hilt or have access to the governance, we can not build capital.

If the country is 100 people large, but only 10 trust each other to do for each other, then how much wealth can they actually build if 93% of the 77% of intangible capital is related to law access (trust) and education (the removal of fear; trust) of the populace? But then, our founders seemed to have already reasoned this. Jefferson started the free education to including college!

So why should this report seem so “new”. This makes me think of the years of government bashing we have been hearing from the republican side. Reagan’s infamous “nine most dangerous words in the English language: I’m from the government and I’m here to help you.” It makes me realize we have to dump the Bush/neocon ideology here and in our foreign policy if only to remove the fear so that trust can return.

Mr. Hamilton’s example of the difference in thinking is in when he discusses pollution as a resource management issue:

It’s not a pollution problem; it’s a natural resources management problem. How do you maintain soil quality? How do you generate profits with the assets that you have, which in this case is land that can be invested in other things? The problem in China is they’ve figured out how to grow 9 percent a year pretty successfully but they’re now facing the environmental consequences of uncontrolled growth.

This is policy that he is talking about. Policy of what to spend on and policy governing relationships both boiling down to regulation. (What was that Milton quote the other day?)We’re talking government. I interpret this report as making a case that shrinking government to where it can be drowned in a bath tub is not the way to build wealth. The market will not solve our problems of growth for us. It is not the answer to Save the Rust Belt’s question of how to save the rust belt? We have to do it and we have to do it in a manor that is inclusive for that is the only way to maximize the “intangible capital”. It also means we have to do as Cactus is attempting to do; qualify our policy results related to specific ideology. Just charting to see what GDP is doing or just looking at supply and demand theory won’t do it. That’s just bench racing.

The World bank has done some qualifying and changed their ideology:

Hamilton: In the old days, we thought if you built the infrastructure then development would come-the Field of Dreams model of development. It turns out to be a lot harder than that.

Dare I suggest that the World Bank has discovered that an economy exists for our benefit and not for it’s own sake? Maybe they read our Declaration and our Constitution.

Tags: , , , Comments (3) | |

Money from money? Not good.

On September 28th Bill Moyers’ guest was John Bogle. You can see the interview or read the transcript from here.

The setup for the interview is about private equity firms and he mentions the Sunday NY Times front page article: At Many Homes, More Profit and Less Nursing.

His introduction of Mr. Bogle is:

It’s this kind of capitalism that drives John Bogle up the wall, as you’re about to learn. John Bogle believes owners should be in charge — and accountable. He’s known and respected world-wide as the father of index funds and the founder of The Vanguard Group, one of the largest mutual funds anywhere, with over a trillion dollars in assets.

I make no bones about it. My opinion is that the focus is currently wrong 1. as it relates to purpose of an economy and 2. by the philosophy that studies it: economics. The focus of understanding resulting in the judgment of an economy, should be in how successful it is in fulfilling these two aspects of the constitution: insure domestic tranquility, promote the general welfare.

I’ll put it this way: to what purpose is there to knowing how to make horse power, greater efficiency, greater durability, the relationship of the parts in motion, the chemistry of fuels, the metallurgy, flow dynamics, etc., etc., etc. if not to serve people? Just because? Just to make more?

So picture me in my recliner (be kind), suspicious of what I will hear when Mr. Moyers asked:

BILL MOYERS: What should be the dominant? What is the job of capitalism?

JOHN BOGLE: Well, ultimately, the job of capitalism is to serve the consumer.

WHAT?!!!!!!!! There is someone with more money than God that thinks like me? But…is there a but? Don’t tease me like this. I’m the one saying we are making money from money and that such is of no substance especially as it relates to our purpose (see US Constitution).

Within his answer is:

But, we’ve moved from that to a big capital accumulation — self interest — creating wealth for the providers of these services when the providers of these services are in fact subtracting value from society. So, it doesn’t work.

You can mail my PhD diploma — thank you very much, to: … : )

He notes that Lord Keynes has gotten “misshapen”. How?

JOHN BOGLE: Well, it’s gotten misshapen because the financial side of the economy is dominating the productive side of the economy…We’ve become a financial economy which has overwhelmed the productive economy to the detriment of investors and the detriment ultimately of our society.

How bad is it?

It’s just gotten totally out of hand. My estimate is that the financial sector takes $560 billion a year out of society. Five hundred and sixty billion.

Did I hear this right, focusing on making money from money is not where it’s at? It’s hurting us?

I want to come back to the difference between the financial system and the productive system. The productive system adds to the value of our economy. And, by and large, the financial system subtracts. And, yet, it’s growing and growing and growing. And this short term thing where short term orientation in which trading pieces of paper is regarded as a social value. It is not a social value.

But what about labor? Do those at the top really get what they deserve?

And they get enormous amounts of pay for actually doing very little. I’m a
businessman. Listen, we all– we chief executives get an awful lot of credit
that we don’t deserve. Real work in companies is done by the people who are
getting themselves together and doing the hard work of making companies grow–

So, Milton knew of externalities, and a need for governance. Although it’s already in the constitution and should not be debatable. Cactus’ is showing us ideology matters. And now a person who makes money from money is telling us the current ideology has gone to far. What’s next? The World Bank seeing the light? Glad you asked. That is exactly what is next.

Tags: , , Comments (0) | |

Doing Business, World Bank ranking

Just a little break from the usual. Did you know you can pay your taxes easier in Iraq than in the US?

I stumbled across this today. It is the World Bank page on Doing Business. It ranks 178 countries on 10 topics. You can resort the order depending on 3 different settings. When you initially open the page you see the overall order.

Interestingly, the US with it’s over all ranking of 3, under ease of paying taxes: 76th. Iraq ranked 37 under this topic and is not even at the bottom over all! It even ranks 40th on registering property. But it is 164th on starting a business and once you start it, you probably can’t close it as that topic ranks 178 (the bottom).

Have fun.

Update: There is a report that goes along with this. Doing Business in 2005

Tags: , , Comments (0) | |

Even earlier Cheney

I have intentionally let others post about the politics of this war wanting to keep the focus on economics as that is what attracts me to this blog. BUT…for all the postings here that have resulted in supportive comments for the war, please explain this.

Dick Cheney at the Economic Club of Detroit in 1992 (2 years earlier than the 94 Cheney). Note that Cheney refers to the objectives and achieving them. Note the mention that going in would have resulted in the “disintegration of the Arab coalition”. “The world was with us” was not a post 9/11 phenomenon. It was who we always were.

“It’s not the kind of situation where you could pull up in front of the presidential palace and say common Saddam you’re going to the slammer.”

“For the 146 Americans who were killed in action and for their families it was not a cheap or a low cost conflict.”

I new when Bush was first running he wanted a war. It was in what he was saying. My sweety and I wonder how those supporting him could not see this assuming a reasonable person would not want a war talking president when there was no war potential in sight.

So please (I’m being polite here) tell me how this current war was undertaken for my benefit? Before you hit that comment button, read this too.

Comments (0) | |

Greenspan vs Klein on Democracy Now

Just an FYI related to recent postings here. Democracy Now for 9/24 has about a 38 minute discussion with both Naomie Klien and Alan Greenspan. The remaining minutes is with Jeremy Scahill.

This particular exchange caught my attention:

AMY GOODMAN: Alan Greenspan, you write in the end of your book, “A Federal Reserve System that will be confronted with the challenge of inflation pressure and populist politics that have been relatively quiescent in recent years” is something that is very significant. You say the year — the United States in 2030 is likely to be characterized by populist politics that have been relatively quiescent in recent years. How important is populist politics, and what do you envision those to look like?

ALAN GREENSPAN: Well, remember what populist politics is. It’s a very special brand of short-term focus, which invariably creates very difficult long-term problems. A goodly part of the book, as you know, is written about how populism has gripped, say, many Latin American countries to their detriment. And the term “populist politics” is essentially another way of saying short term versus longer term. And people who emphasize short-term benefits for long-term costs end up with very little in the way of economic growth and prosperity.

Personally, I have never viewed populism as short term viewing. Infact, I read nothing at Wikipedia that suggested such.

Populism is a political doctrine or philosophy that purports to defend the interests of the common people against an entrenched, self-serving or corrupt elite.

I think Mr. Greenspan has a little projection (in pysch terms) happening here. Naomie Klein furthers the question and raises his policies as playing a part in the rise of economic populism. His answer, we have bad education. She follow up on his example of Latin America:

But you also mentioned economic populism in Latin America in your book, and you blame it for inflation episodes and the collapse of regimes and the toppling of governments, and one of your examples was Chile in the 1970s. Was Chile — was Salvador Allende’s regime toppled because of inflation, or didn’t the CIA have something to do with that?

ALAN GREENSPAN: Well, look, let’s — I’m using Latin America as an example. The key question is not Latin America. Let’s get back to the United States. Let’s get back to the world at large and face the issue of populism here. Remember, the populist issue in Latin America goes back to the roots of Spanish and Portuguese colonization.

I’m sorry, but if that answer wasn’t a classic “troll” response I don’t know what is.
Enjoy.

Tags: , Comments (0) | |

Growth, more than freedom of capital

We have been discussing a lot of economics through the political viewer lately. And I certainly have laid my point of view out there, but I also like the theory discussion. I like to think and know how stuff works or how someone interprets what they see. I believe discussing theories leads to better political discussion. With that, I hope this might inspire some tangent topics into the political here at AB.

This is a paper out of France by Robert U Ayres & Benjamin Warr titled: Accounting for Growth: The role of physical work

They suggest the increasing extraction of work from energy do to the increasing development of energy use is the missing factor that explains our growth.

“However the major result of the paper is that it is not `raw’ energy (exergy) as an input, but exergy converted to useful (physical) work that – along with capital and(human)labor – really explains output and drives long-term economic growth.” “However, if we replace raw energy as an input by `useful work’ (the sum total of all types of physical work by animals, prime movers and heat transfer systems) as a factor of production, the historical growth path of the US is reproduced with high accuracy from 1900 until the mid 1970s, without any residual except during brief periods of economic dislocation, and with fairly high accuracy since then.”

There key concept is the definition of exergy.

“The formal definition of exergy is the maximum work that could theoretically be done by a system as it approaches thermodynamic equilibrium with its surroundings, reversibly. Thus exergy is effectively equivalent to potential work. There is an important distinction between potential work and actual work done by animals or machines. The conversion efficiency between exergy (potential work), as an input, and actual work done, as an output, is also an important concept in thermodynamics. The notion of thermodynamic efficiency plays a key role in this paper.
To summarize: the technical definition of exergy is the maximum work that a subsystem can do as it approaches thermodynamic equilibrium (reversibly) with its surroundings.”

This summarizes their theories development:

The supposed link between factor payments and factor productivities gives the national accounts a direct and fundamental (but spurious) role in production theory. In reality, however, (as noted in the introduction) the economy produces final products from a chain of intermediates, not directly from raw materials or, still less, from labor and capital without material inputs. In the simple single sector model used to `prove’ the relationship between factor productivity and factor payments, this crucial fact is neglected. Allowing for the omission of intermediates (by introducing even a two-sector or three-sector production process) the picture changes completely. In effect, downstream value-added stages act as productivity multipliers. This enables a factor receiving a very small share of the national income directly, to contribute a much larger effective share of the value of aggregate production, i.e. to be much more productive than its share of overall labor and capital would seem to imply if the simple theory of income allocation were applicable [Ayres 2001a].

If this is true, then we have a bigger problem concerning how to keep this boat floating than subprime lending and fed rates. We have a policy problem. And that speaks to all the work Cactus has done about presidents.

Related to Cactus’ work, this chart from the this paper is interesting. It is the unexplained portion of growth by their theory.

Note that this phenomenon begins right about where we see the lowest point of the top 1% share of income, just after we see the split of productivity from wages and the beginnings of the supplyside policies and a change to a net debtor nation. The authors suggest some of this is do to conservation.

“We conjecture that a kind of phase-change or structural shift took place at that time, triggered perhaps by the so-called energy crisis, precipitated by the OPEC blockade. Higher energy prices induced significant investments in energy conservation and systems optimization.”

They further refine the explanation with:

“The marginal productivity of capital has started to increase whereas the marginal productivity of physical work – resulting from increases in the efficiency of energy conversion – has declined slightly.”

Could this marginal capital productivity increase be a result of our policy focus on capital as the driver of growth? Money from money? Are we seeing in their explanation that part of our growth that is borrowed from our future, thus artificially created?
As I read this paper it made me think about the European economies who have been focusing on alternative energy development, wind in Denmark, solar in Germany, (Japan), wave generation in England and northern parts, geothermal in Iceland/Greenland. This paper to me suggests that this coming election has at the core of all our topical issues (health care, war, inflation) energy. As the authors conclude keeping in mind peak production issues and the declining output of Saudi’s fields:

“From a long-term sustainability viewpoint, this conclusion carries a powerful implication. If economic growth is to continue without proportional increases in fossil fuel consumption, it is vitally important to exploit new ways of generating value added without doing more work. But it is also essential to develop ways of reducing fossil fuel exergy inputs per unit of physical work output (i.e. increasing conversion efficiency). In other words, energy (exergy) conservation is probably the main key to long term environmental sustainability.”

Is China in trouble? There is a start of a discussion about peak oil and it’s potential effect here.

Tags: , , , Comments (0) | |

Never thought I’ld make it to the aristocrat class

We have a lot of discussion about the moral hazard of Iraq, related to life (the trump card), but I think we need more discussion concerning the policies related to the flow of money because after all, this is an econo blog. Thus, these two articles. The first one: The Great Iraq Swindle (RollingStone) and the second one: The Mercenary Revolution (The Indypendent).
First, are you an aristocrat?

Both of these are reporting on the extent of privatization that has taken place concerning our security. I’ll get right to my point of the question: We are paying people dirt to do our dirty work. We have collectively become a nation that insulates it’s responsibility for all that is a military involved exercise by buying our war making. We just go to War is Us, sign a contract and wah la, we have the fight’n 9th or 99th or 101 or what ever and no one has to ever worry again about that little question of “did you serve?” Nope, we can now without the risk of harm to our person or our mind bench race our wars. And the race is not about winning the ideologic battle of democracy vs something else. No, it’s about getting yours.
From the first article, The author’s sums it up:

It was an invasion of the federal budget, and no occupying force in history has ever been this efficient.
In Iraq the lines between essential government services and for-profit enterprises have been blurred to the point of absurdity — to the point where wounded soldiers have to pay retail prices for fresh underwear, where modern-day chattel are imported from the Third World at slave wages to peel the potatoes we once assigned to grunts in KP, where private companies are guaranteed huge profits no matter how badly they fuck things up.
This is the triumphant culmination of two centuries of flawed white-people thinking, a preposterous mix of authoritarian socialism and laissez-faire profit­eering, with all the worst aspects of both ideologies rolled up into one pointless, supremely idiotic military adventure — American men and women dying by the thousands, so that Karl Marx and Adam Smith can blow each other in a Middle Eastern glory hole.

We’re taking about profit­eering at the expense of the commons. It is our budget going to hell. It is our future spent today. It is our children carrying us. To me, it is selfishness to the extreme. It is what I think of with the use of the word aristocrat. That it is done in our name being that we are the government means we are aristocrats in persona.
As aristocrats, we are keeping it close to family:

[Bush] named Jim O’Beirne at the relevant evaluation desk in the Department of
Defense….he sent a twenty-four-year-old who had never worked in finance to
manage the reopening of the Iraqi stock exchange, and appointed a recent graduate of an evangelical university for home-schooled kids who had no accounting experience to manage Iraq’s $13 billion budget. James K. Haveman, who had served as Michigan’s community-health director under a GOP governor, was put in charge of rehabilitating Iraq’s health-care system and decided that what this war-ravaged, malnourished, sanitation-deficient country most urgently needed was . . . an anti-smoking campaign.

Throughout the article there is the theme of exemption, exception, and favoritism. Are these not the means of play by aristocrats? Referring to the Custer Battles company:

The Bush administration not only refused to prosecute the pair — it actually tried to stop a lawsuit filed against the contractors by whistle-blowers hoping to recover the stolen money. The administration argued that Custer Battles could not be found guilty of defrauding the U.S. government because the CPA was not part of the U.S. Government.

A judge set aside the jury’s guilty verdict. Oh the life of an aristocrat.

There is more, read the article. Half way through it is suggested that these activities are a result of a lack of patriotism. But, aristocrats are very patriotic. One might say super patriotic. Are we not?

None of this could take place without the removal of the responsibility for the physical execution of a military exercise via privatization of the military. Why do we not see more protesting? Because we are all allowed to be aristocratic in our relationship to this military adventure. From the second article:

If you think the U.S. has only 160,000 troops in Iraq, think again. With almost no congressional oversight and even less public awareness, the Bush administration has more than doubled the size of the U.S. occupation through the use of private war companies. There are now almost 200,000 private “contractors” deployed in Iraq by Washington. This means that U.S. military forces in Iraq are now outsized by a coalition of billing corporations whose actions go largely unmonitored and whose crimes are virtually unpunished.

The single largest U.S. contract for private security in Iraq was a $293 million payment to the British firm Aegis Defence Services, headed by retired British Lt. Col. Tim Spicer, who has been dogged by accusations that he is a mercenary because of his private involvement in African conflicts. The Texas-based DynCorp International has been another big winner, with more than $1 billion in contracts to provide personnel to train Iraqi police forces, while Blackwater USA has won $750 million in State Department contracts alone for “diplomatic security.”

We’re even paying people outside the military to guard our generals!

What is unique about this period of aristocratic war playing is that the aristocrats are not just hiring out the war labor, but are the company them self and thus as is consistent with aristocratic play, exempt them self and by extension anyone they pay from the hell they create.
We are holding no one responsible.

Dozens of American soldiers have been court-martialed — 64 on murder-related charges alone — but not a single armed contractor has been prosecuted for a crime against an Iraqi. In some cases, where contractors were alleged to have been involved in crimes or deadly incidents, their companies whisked them out of Iraq to safety.
Rep. Jan Schakowsky (D-Ill.), a leading member of the House Select Committee on Intelligence, which is responsible for reviewing sensitive national security issues, explained the difficulty of monitoring private military companies on the U.S. payroll: “If I want to see a contract, I have to go up to a secret room and look at it, can’t take any notes, can’t take any notes out with me, you know — essentially, I don’t have access to those contracts and even if I did, I couldn’t tell anybody about it.”

This is not Bush et al alone. He is only the elected executive with an elected board (congress) representing us in our governance of us. So, as he and they act in an aristocratic style, we are too acting in an aristocratic style. Sounding convoluted? Yes, it is what comes of a means constructed to immune one’s self from one’s actions.

The article also discusses the business model for our new privatization of all that is military. It is consistent with what we have discussed concerning globalization. It is referred to as the “branding” of the military, “a hollow company like Nike”. And as would be expected, they are doing it on the cheap by outsourcing the labor. Literally hiring military personal from defunct 3rd world dictatorships.

On so many levels, morally, ethically, what ever you call it, not being responsible for your own actions is wrong. Some may think they are exempt from being labeled an aristocrat because all these aristocratic actions Bush et al are doing are considered to be outside the government by Bush et al. If it were only so easy. Darn government of, for and by the people!

But, let’s consider what we have created with our aristocratic attitude that is more germane to this blog. From The New Yorker, Hendrik Hertzberg reports:

At a forum on foreign policy, Lorelei Kelly, a former Capitol Hill
national-security aide who blogs at Huffington Post and democracyarsenal…

In that connection, she made another point that was new to me. The military-industrial complex produced by the Cold War …was and is able to prosper in the absence of actual fighting. The purpose of piling up all those missiles targeted on the Soviet Union, after all, was to avoid using them. But the kind of privatization represented by the gun-toting Iraq war contractors has created what she called “a live war military-industrial complex”—that is, an industry that depends for its profits, even its existence, on hot wars, wars that kill people. “Free-market conservatives have given us this,” she said. “In conversations with military people, it’s an opening to all sorts of other issues.”

We created this now multibillion dollar, job creating, money making new addition to our GDP — how do we now get rid of it when Iraq is done?

Comments (0) | |

Make a better election choice

Just want to let everyone here know of this web site I heard about. It is My Election Choices.com. Their opening statement:

Isn’t your vote for President worth more time than a game of Sudoku?

This site helps you learn which candidates most agree with you. The creators of the site have taken statements made by all the presidential candidates and classified them into 18 categories. You then check off the statements you agree with. You are blinded as to which candidate made the statement.

I have done 2 categories that each had 3 pages of statements. When you click Finish, you are taken to a page that has a bar chart showing you the relationship of agreement you have with each candidate. As you complete a category, it adjust your chart to reflect the summation of agreement with each candidate.

I have completed On Taxes, Spending and Fiscal Policy and On Trade and Globalization. Interestingly, so far I have agreement on 8 Clinton statements, 7 Ron Paul, 5 each for Dodd, Hunter, Richardson and Tancredo. It goes down from there with the other candidates to where I have only 1 statement of agreement with Biden and Brownback. I have to say, some of the statements I agreed with I did not expect to have been made by the particular candidate. You are shown in the results who made each statement and the percent of agreement to date of all those who have completed said category.

You can also see what the cumulative is for all those who have completed all the categories based on topic, gender or most popular category. Currently the leading candidate at 27% based on topic is Dodd. At 23% is Kucinich, Hunter, and Huckabee. Clinton is at 11% as is Gravel!

I think this site is just what has been missing in our modern elections. It give one an opportunity to work through all the candidates’ positions while minimizing the prejudice you might have already assigned to a candidate. It is a way of cutting out the coloring that our media adds to our learning about a candidate.

I encourage you to give it a run. But, as they suggest, only pick one or 2 categories to start. You can go back anytime and pick up where you left off. I think you’ll be pleasantly surprised. Enjoy.

Comments (0) | |