Oligarchy Watch at New Ruskin College
www.NewRuskinCollege.com
Lecture Notes: 5-20-05
Oligarchy Watch
The American system has built into it a fundamental unfairness because the immigrant groups that were organized into a nation state did not trust one another. All state organization was therefore done ad hoc as the contending factions divided up the spoils. The big urban political machines created only alliances between Irish and Italian, Black and Pole, Catholic and Protestant, etc., not building a national social consensus on governance, only giving the Irish the police department, the Italians the fire department, etc..
So today we have Viagra for retired millionaires paid for by workers whose children must go to lousy public schools that do not even have text books. We have billions in subsidies for millionaire farmers not to grow anything, but 85% of the residents of the Bay Area can not afford the homes in which they live. Workers earning less than $16 an hour must pay the “guaranteed” pensions of workers who earn $250,000 a year flying to London twice a week. (And this, the fact that United pilots will receive “only” $35,000 in pension payments a year, not the $90,000 they had “contracted” for in their union agreement, is considered a grave moral outrage. Those corporations!)
These are “imbalances,” as economists call them. We never stand back an evaluate the true moral situation because the American political discussion is not really an intellectual discussion. The words are only “theory” for everyone knows that really we are engaged in a civil war of contending groups each trying to beggar their neighbors. The words are only “cover,” a mere pretense at civility and reason. Violence is always at hand. Mendacity has become a kind of art.
For example Marin Senators Boxer and Feinstein, and now even Mrs. Billy Clinton know that they can “talk tough” about illegals because no one takes their words seriously. Or, for example, many leftist continue to assert that “there was no connection” between Saddam Hussein’s Iraq and the attacks on the World Trade Center, and even, insanely, with terrorism. This despite all evidence to the contrary. (“Indeed, . . . in . . . 1994, a Jordanian-based stringer working for ABC News spotted Abdul Rahman Yasin outside his father’s house in Baghdad and learned . . . (he) worked for the Iraqi government. (112)” see McGurk Tutorial ( Nor wasRahman the only terrorist protected by Mr. Hussein:( http://www.mail-archive.com/sam11@erols.com/msg00490.html) ))
This alienated political discourse is possible because of the social stratification of the Post Liberal elite in their privileged bastions, where they are isolated by not just by their gates, but they are cocooned in whole regions where exclusionary zoning guarantees their isolation. (“I recently realized that I have not known anyone who had a SAT score under 1400 since I was in high school.” (10 extra credit points if you can name the person who said this.))
Without a commitment to social equity and fairness there can be no trust between the competing groups, and the peace can be bought only with the delivery of the spoils, the “bacon.” Racial and gender quotas are another, more recent example of the moral corruption of American public policy. The quota is necessitated by the lack of trust. Oh, sure the university president claims he is attempting to recruit qualified students but how do we know? (That university presidents are themselves the most obsequious genuflecting liberals merely adds irony to the hostage negotiations. (No organizations have been more ruthless in the application of quotas than insurance companies. CENCAL insurance, (which worked with Mrs. Jack Swanson to harass me), recently left an insured of theirs with a $1.5 million judgment because the inexperienced female supervisor, hired to fill a quota, refused to settle the claim for policy limits. (The policy limit was $15,000.) And as another example of the futility of public discourse consider how little difference it makes to you that my enemies are shown to be incompetent. You may recognize that Mrs. Jack Swanson is every bit as horrible as I have said, yet, who cares? (This cynicism now characterizes American society. The rich and powerful are permitted to use their power to destroy another because no one expects that they should obey the same rules of conduct as everyone else. We are actually shocked at the suggestion that Don Imus, or Michael Weiner, or Ron Lowenstein, or Michael Krasney, or either Jack or Mrs. Jack Swanson, should even be expected to conform to any social standard. ‘They are rich and you are not. What do you expect?’)))
The women PhDs of Harvard recently accused the president of Harvard of possibly holding some secret malice for their sex, and the demand that Harvard resort to quotas for the hiring of female scientist seems to have been averted only by the promise to pay a $50 million ransom to the ---
Counselor: . . .
. . . for the recruitment of more female scientists.
True the struggling masses are no longer impoverished illiterate immigrants in cold water walk ups, so their strident rhetoric now rings false, (I am thinking of Senator Kennedy’s wild rhetoric and angry shouting, he apparently being unaware that he is widely regarded as simply a joke and his words humbug), but the goal continues to be the same: Plunder. Buy the public peace by sacking the public treasury. Thus the preposterous cries of moral outrage when the mere suggestion is made to slow the rate of increase of Social Security for those whose retirement incomes are above the median, (by using a different formula, one based on the price increases of goods and services instead of the current formula which is based on the increase of wages. (It is in no way certain that wages will keep up with inflation in the future, (indeed there is every reason to believe that they will not, as America’s standard of living sinks ever deeper due to our mismanagement of the economy. ))) Or when someone humbly suggests that millionaire retirees might be asked to pay for their own Viagra; wailing against the unfairness.(http://www.alertnet.org/thenews/newsdesk/N16485496.htm)
In such a system only the politically powerful are able to manipulate the state to direct benefits away from others and to themselves. The American experience with the corruption of the big city machines, i.e. Boston, New York, Chicago, San Francisco has shaped our political discourse, I mean betrayed it, made it false, reduced it to base hypocrisy. When all we really want is: The MONEY. (Not so much social policy as simple greed, which leads to predictable results.(http://www.post-gazette.com/pg/05133/504149.stm) In the absence of a coherent social policy our wealth itself acts as a social lubricant reducing the friction between the contending groups. This utter debasement of public discourse is a kind of achievement in its own way, and this baseness in political discourse alone has allowed commerce to develop and heap up America’s great wealth, the capitalists resorting to the expedient of simply buying off the politicians just as the politicians themselves purchase their “constituent’s” loyalty. (What bacon does not buy the gerrymandered districts secure. (Thus “the world’s greatest democracy” has only a few “competitive” i.e. real elections every now and then.(http://www.signonsandiego.com/uniontrib/20040523/news_lz1e23hill.html))) An economy of corruption. (http://reforminstitute.org/cgi-data/news/files/27.shtml)
One reason for Germany’s unhappy experience with its first attempt at democracy was that the society was divided into social, class, and trade groups that failed to develop social cohesion. The university professors formed one political group. Shop girls another. Artisans organized around a political persuasion different from factory workers which saw themselves different from tradesmen and all three groups saw themselves entirely different from the office workers, and so on to the Republic’s bitter end. If you had tried to explain that their political aims were narrow, or selfish, they simply would not have understood. ‘Are you an idealist?’
Isolated behind its great oceans America has enjoyed a kind of innocence. And the politics that has served the nation has been able to continue in this daft way only because its contact with reality has been so limited. For it is only when the political class has actually come into contact with reality that its insincerity, cynicism, selfishness, base vanity has been shown for what it is.
Vietnam was for years “managed” by the Washington elite before the reality could no longer be denied. Their policies were self contradictory, delusional, a lie. War has a way of cutting through false rhetoric. This is why military men are laconic. (“There was no need to say ‘This bag is’, all you needed to say was ‘empty.’”)
As in war, so too with commerce. The truth will out. William F. Buckley, Jr., was talking about the savings and loan problem in the mid 1960s. Yet the defaults and government bailouts came in the 1980s. Prescience? Or genius? No. Economics!
This selfish, duplicitous elite, set rules, “insurance”, for the accounts which distorted the market. The next generation paid the price just as their rules in Vietnam cost millions their lives. Reality knocks.
Now see how the “insured” deposits allowed the savings and loans to push off losses onto the government, just as today, the Pension Benefit Guaranty Corp., (PBGC), allows companies to cast off their pensions onto the tax payers. And just as Mr. Buckley used to point out the lack of oversight of the deposit insurance there have now been four separate reports from four separate groups of actuaries who have reported that the PBGC has failed to properly underwrite its “portfolio.” And guess what? Who do you think is going to end up paying the $400 billion in unfunded liabilities? ( http://www.actuary.org/pdf/pension/funding_single.pdf • 1134.1k) (http://www.davidlanger.com/article_c38.html )
(http://www.insidedenver.com/drmn/business/article/0,1299,DRMN_4_3430985,00.html)
The insurance!
Just as those ‘bonds’ in the Social Security filing cabinet in West Virginia are said to pay for Social Security in 2017.
But the important point is to see why the political discussion is so false. These are not really arguments. The people making these points do not even themselves take these arguments seriously. They do not have to. They are part of the Post Liberal elite.
They are safe and secure in their “group” or party. All these problems are to them only “theory” or speculation. The truth is of no interest to them. Their party reality is the true reality because it will be their party which will secure them, reward them.
Or take the housing bubble. The tax law has for decades been used to distort the market. Then the zoning and building codes have been used to exclude the poor and middle class. Blocking development has been elevated to a high social and moral purpose. (The Marin Senators Boxer and Feinstein used their offices to restrict supply when they were Supervisors in Marin and San Francisco. (Supervisor Feinstein purchased a sizable real estate portfolio of multi story buildings which appreciated in value as her ordinances restricted the supply. (see paper no. 1948. Edward L. Glaeser and Joseph Gyourko The Impact of Zoning on Housing Affordability next link )
( http://post.economics.harvard.edu/hier/2002papers/2002list.html )))
But our elite is not content with tax law manipulation of the market and the more direct zoning and building code distortions of the market; they have also created huge government monopolies to trade in the mortgage market in ways private companies would not dare. Dr. Greenspan, observing the growing risk of the government monopolies’ portfolios has said he can find no reason for why these monopolies would want to take on such risks except to profit from these activities knowing full well that once again, (who?), that is right, the taxpayer will be there to pay.
But long before that catastrophe strikes the people will have already paid an enormous price. And if you are thinking of the price of the homes you are missing the point completely. Yes, these distortions of the housing market have created a “Tulip Economy” but the real price is paid in society. (Tulip: http://www.newruskincollege.com/moynihanmemoriallibrarynewruskincollegecom/id20.html)
Your disconnect from reality has distorted the market, yes, but just look at your cities. In the cityscape you can see your greed, and selfishness, and base vanity. In the ruin of whole lives. . . in the miles of headlights on the “free” ways, as your fellow citizens commute in, from where your selfishness banished them.
And there is no way to talk to you about these things. Not about Vietnam. Not about Saddam Hussein’s terror regime. Not about the ever growing danger of bio-war. Not about the savings and loan deposit “insurance.” Not about the pension “guarantees”. Not about Social Security, or Medicare. Not about the $8 trillion you leave to your grandchildren’s generation. Not about the housing bubble your policies have created.
Words do not matter.
I will blow my brains out onto the walls of the KQED building.
And my blood will not move you.
Neither words nor blood . . . you are beyond reach. You are completely lost.
You will go on and on repeating the same mistakes, lost in your vanity and egotism.
What an empty barren universe.
Dr. Greenspan, observing the growing risk of the government monopolies portfolios . . . He said those holdings, which total about $1.5 trillion, do not support homeownership, increase the availability of long-term fixed-rate mortgages or lower borrowing rates for homebuyers. "The Federal Reserve Board has been unable to find any credible purpose for the huge balance sheets built by Fannie and Freddie other than the creation of profit through the exploitation of the market-granted subsidy," Greenspan said. Fannie and Freddie are shareholder-owned companies charged by Congress with supporting homeownership by ensuring a liquid mortgage market. To do this, they buy home loans from originators and repackage them as securities for sale to investors. They also hold some mortgages and securities in their portfolios, which the companies say helps them fulfill their mission. But Greenspan and others have argued that those portfolios pose a risk to the financial system by aggregating so much interest rate and prepayment risk within two companies.
Over the past four years, housing prices have increased 50 percent faster than consumer disposable incomes, according to the Federal Deposit Insurance Corp.'s latest Risk-Based Assessment System report. Add in the National Association of Realtors' observation that nearly one in four homes sold last year were purchased by investors -- people who did not plan to live in the homes, but intended to resell them in the near future at a profit -- and it is little wonder that some economists continue to warn about the potential for the bursting of the "housing bubble."
Last month, more than 28,000 American houses - 57% more than in March 2004 - re-entered the housing market as foreclosed properties- the economic fallout from rising interest rates and slowing house appreciation, property-listing service Foreclosure.com reported Wednesday.
www.NewRuskinCollege.com
Lecture Notes: 5-20-05
Oligarchy Watch
The American system has built into it a fundamental unfairness because the immigrant groups that were organized into a nation state did not trust one another. All state organization was therefore done ad hoc as the contending factions divided up the spoils. The big urban political machines created only alliances between Irish and Italian, Black and Pole, Catholic and Protestant, etc., not building a national social consensus on governance, only giving the Irish the police department, the Italians the fire department, etc..
So today we have Viagra for retired millionaires paid for by workers whose children must go to lousy public schools that do not even have text books. We have billions in subsidies for millionaire farmers not to grow anything, but 85% of the residents of the Bay Area can not afford the homes in which they live. Workers earning less than $16 an hour must pay the “guaranteed” pensions of workers who earn $250,000 a year flying to London twice a week. (And this, the fact that United pilots will receive “only” $35,000 in pension payments a year, not the $90,000 they had “contracted” for in their union agreement, is considered a grave moral outrage. Those corporations!)
These are “imbalances,” as economists call them. We never stand back an evaluate the true moral situation because the American political discussion is not really an intellectual discussion. The words are only “theory” for everyone knows that really we are engaged in a civil war of contending groups each trying to beggar their neighbors. The words are only “cover,” a mere pretense at civility and reason. Violence is always at hand. Mendacity has become a kind of art.
For example Marin Senators Boxer and Feinstein, and now even Mrs. Billy Clinton know that they can “talk tough” about illegals because no one takes their words seriously. Or, for example, many leftist continue to assert that “there was no connection” between Saddam Hussein’s Iraq and the attacks on the World Trade Center, and even, insanely, with terrorism. This despite all evidence to the contrary. (“Indeed, . . . in . . . 1994, a Jordanian-based stringer working for ABC News spotted Abdul Rahman Yasin outside his father’s house in Baghdad and learned . . . (he) worked for the Iraqi government. (112)” see McGurk Tutorial ( Nor wasRahman the only terrorist protected by Mr. Hussein:( http://www.mail-archive.com/sam11@erols.com/msg00490.html) ))
This alienated political discourse is possible because of the social stratification of the Post Liberal elite in their privileged bastions, where they are isolated by not just by their gates, but they are cocooned in whole regions where exclusionary zoning guarantees their isolation. (“I recently realized that I have not known anyone who had a SAT score under 1400 since I was in high school.” (10 extra credit points if you can name the person who said this.))
Without a commitment to social equity and fairness there can be no trust between the competing groups, and the peace can be bought only with the delivery of the spoils, the “bacon.” Racial and gender quotas are another, more recent example of the moral corruption of American public policy. The quota is necessitated by the lack of trust. Oh, sure the university president claims he is attempting to recruit qualified students but how do we know? (That university presidents are themselves the most obsequious genuflecting liberals merely adds irony to the hostage negotiations. (No organizations have been more ruthless in the application of quotas than insurance companies. CENCAL insurance, (which worked with Mrs. Jack Swanson to harass me), recently left an insured of theirs with a $1.5 million judgment because the inexperienced female supervisor, hired to fill a quota, refused to settle the claim for policy limits. (The policy limit was $15,000.) And as another example of the futility of public discourse consider how little difference it makes to you that my enemies are shown to be incompetent. You may recognize that Mrs. Jack Swanson is every bit as horrible as I have said, yet, who cares? (This cynicism now characterizes American society. The rich and powerful are permitted to use their power to destroy another because no one expects that they should obey the same rules of conduct as everyone else. We are actually shocked at the suggestion that Don Imus, or Michael Weiner, or Ron Lowenstein, or Michael Krasney, or either Jack or Mrs. Jack Swanson, should even be expected to conform to any social standard. ‘They are rich and you are not. What do you expect?’)))
The women PhDs of Harvard recently accused the president of Harvard of possibly holding some secret malice for their sex, and the demand that Harvard resort to quotas for the hiring of female scientist seems to have been averted only by the promise to pay a $50 million ransom to the ---
Counselor: . . .
. . . for the recruitment of more female scientists.
True the struggling masses are no longer impoverished illiterate immigrants in cold water walk ups, so their strident rhetoric now rings false, (I am thinking of Senator Kennedy’s wild rhetoric and angry shouting, he apparently being unaware that he is widely regarded as simply a joke and his words humbug), but the goal continues to be the same: Plunder. Buy the public peace by sacking the public treasury. Thus the preposterous cries of moral outrage when the mere suggestion is made to slow the rate of increase of Social Security for those whose retirement incomes are above the median, (by using a different formula, one based on the price increases of goods and services instead of the current formula which is based on the increase of wages. (It is in no way certain that wages will keep up with inflation in the future, (indeed there is every reason to believe that they will not, as America’s standard of living sinks ever deeper due to our mismanagement of the economy. ))) Or when someone humbly suggests that millionaire retirees might be asked to pay for their own Viagra; wailing against the unfairness.(http://www.alertnet.org/thenews/newsdesk/N16485496.htm)
In such a system only the politically powerful are able to manipulate the state to direct benefits away from others and to themselves. The American experience with the corruption of the big city machines, i.e. Boston, New York, Chicago, San Francisco has shaped our political discourse, I mean betrayed it, made it false, reduced it to base hypocrisy. When all we really want is: The MONEY. (Not so much social policy as simple greed, which leads to predictable results.(http://www.post-gazette.com/pg/05133/504149.stm) In the absence of a coherent social policy our wealth itself acts as a social lubricant reducing the friction between the contending groups. This utter debasement of public discourse is a kind of achievement in its own way, and this baseness in political discourse alone has allowed commerce to develop and heap up America’s great wealth, the capitalists resorting to the expedient of simply buying off the politicians just as the politicians themselves purchase their “constituent’s” loyalty. (What bacon does not buy the gerrymandered districts secure. (Thus “the world’s greatest democracy” has only a few “competitive” i.e. real elections every now and then.(http://www.signonsandiego.com/uniontrib/20040523/news_lz1e23hill.html))) An economy of corruption. (http://reforminstitute.org/cgi-data/news/files/27.shtml)
One reason for Germany’s unhappy experience with its first attempt at democracy was that the society was divided into social, class, and trade groups that failed to develop social cohesion. The university professors formed one political group. Shop girls another. Artisans organized around a political persuasion different from factory workers which saw themselves different from tradesmen and all three groups saw themselves entirely different from the office workers, and so on to the Republic’s bitter end. If you had tried to explain that their political aims were narrow, or selfish, they simply would not have understood. ‘Are you an idealist?’
Isolated behind its great oceans America has enjoyed a kind of innocence. And the politics that has served the nation has been able to continue in this daft way only because its contact with reality has been so limited. For it is only when the political class has actually come into contact with reality that its insincerity, cynicism, selfishness, base vanity has been shown for what it is.
Vietnam was for years “managed” by the Washington elite before the reality could no longer be denied. Their policies were self contradictory, delusional, a lie. War has a way of cutting through false rhetoric. This is why military men are laconic. (“There was no need to say ‘This bag is’, all you needed to say was ‘empty.’”)
As in war, so too with commerce. The truth will out. William F. Buckley, Jr., was talking about the savings and loan problem in the mid 1960s. Yet the defaults and government bailouts came in the 1980s. Prescience? Or genius? No. Economics!
This selfish, duplicitous elite, set rules, “insurance”, for the accounts which distorted the market. The next generation paid the price just as their rules in Vietnam cost millions their lives. Reality knocks.
Now see how the “insured” deposits allowed the savings and loans to push off losses onto the government, just as today, the Pension Benefit Guaranty Corp., (PBGC), allows companies to cast off their pensions onto the tax payers. And just as Mr. Buckley used to point out the lack of oversight of the deposit insurance there have now been four separate reports from four separate groups of actuaries who have reported that the PBGC has failed to properly underwrite its “portfolio.” And guess what? Who do you think is going to end up paying the $400 billion in unfunded liabilities? ( http://www.actuary.org/pdf/pension/funding_single.pdf • 1134.1k) (http://www.davidlanger.com/article_c38.html )
(http://www.insidedenver.com/drmn/business/article/0,1299,DRMN_4_3430985,00.html)
The insurance!
Just as those ‘bonds’ in the Social Security filing cabinet in West Virginia are said to pay for Social Security in 2017.
But the important point is to see why the political discussion is so false. These are not really arguments. The people making these points do not even themselves take these arguments seriously. They do not have to. They are part of the Post Liberal elite.
They are safe and secure in their “group” or party. All these problems are to them only “theory” or speculation. The truth is of no interest to them. Their party reality is the true reality because it will be their party which will secure them, reward them.
Or take the housing bubble. The tax law has for decades been used to distort the market. Then the zoning and building codes have been used to exclude the poor and middle class. Blocking development has been elevated to a high social and moral purpose. (The Marin Senators Boxer and Feinstein used their offices to restrict supply when they were Supervisors in Marin and San Francisco. (Supervisor Feinstein purchased a sizable real estate portfolio of multi story buildings which appreciated in value as her ordinances restricted the supply. (see paper no. 1948. Edward L. Glaeser and Joseph Gyourko The Impact of Zoning on Housing Affordability next link )
( http://post.economics.harvard.edu/hier/2002papers/2002list.html )))
But our elite is not content with tax law manipulation of the market and the more direct zoning and building code distortions of the market; they have also created huge government monopolies to trade in the mortgage market in ways private companies would not dare. Dr. Greenspan, observing the growing risk of the government monopolies’ portfolios has said he can find no reason for why these monopolies would want to take on such risks except to profit from these activities knowing full well that once again, (who?), that is right, the taxpayer will be there to pay.
But long before that catastrophe strikes the people will have already paid an enormous price. And if you are thinking of the price of the homes you are missing the point completely. Yes, these distortions of the housing market have created a “Tulip Economy” but the real price is paid in society. (Tulip: http://www.newruskincollege.com/moynihanmemoriallibrarynewruskincollegecom/id20.html)
Your disconnect from reality has distorted the market, yes, but just look at your cities. In the cityscape you can see your greed, and selfishness, and base vanity. In the ruin of whole lives. . . in the miles of headlights on the “free” ways, as your fellow citizens commute in, from where your selfishness banished them.
And there is no way to talk to you about these things. Not about Vietnam. Not about Saddam Hussein’s terror regime. Not about the ever growing danger of bio-war. Not about the savings and loan deposit “insurance.” Not about the pension “guarantees”. Not about Social Security, or Medicare. Not about the $8 trillion you leave to your grandchildren’s generation. Not about the housing bubble your policies have created.
Words do not matter.
I will blow my brains out onto the walls of the KQED building.
And my blood will not move you.
Neither words nor blood . . . you are beyond reach. You are completely lost.
You will go on and on repeating the same mistakes, lost in your vanity and egotism.
What an empty barren universe.
Dr. Greenspan, observing the growing risk of the government monopolies portfolios . . . He said those holdings, which total about $1.5 trillion, do not support homeownership, increase the availability of long-term fixed-rate mortgages or lower borrowing rates for homebuyers. "The Federal Reserve Board has been unable to find any credible purpose for the huge balance sheets built by Fannie and Freddie other than the creation of profit through the exploitation of the market-granted subsidy," Greenspan said. Fannie and Freddie are shareholder-owned companies charged by Congress with supporting homeownership by ensuring a liquid mortgage market. To do this, they buy home loans from originators and repackage them as securities for sale to investors. They also hold some mortgages and securities in their portfolios, which the companies say helps them fulfill their mission. But Greenspan and others have argued that those portfolios pose a risk to the financial system by aggregating so much interest rate and prepayment risk within two companies.
Over the past four years, housing prices have increased 50 percent faster than consumer disposable incomes, according to the Federal Deposit Insurance Corp.'s latest Risk-Based Assessment System report. Add in the National Association of Realtors' observation that nearly one in four homes sold last year were purchased by investors -- people who did not plan to live in the homes, but intended to resell them in the near future at a profit -- and it is little wonder that some economists continue to warn about the potential for the bursting of the "housing bubble."
Last month, more than 28,000 American houses - 57% more than in March 2004 - re-entered the housing market as foreclosed properties- the economic fallout from rising interest rates and slowing house appreciation, property-listing service Foreclosure.com reported Wednesday.
www.NewRuskinCollege.com
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