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<BLOCKQUOTE style="MARGIN-RIGHT: 0px" dir=ltr>
<DIV>Consider the richest one per cent of US citizens. In 2009, their
investible assets - i.e, not including their primary residence, art works,
collectibles, etc. - totaled over $12 trillion. In that year, the total US
budgetary deficit was $1.7 trillion. Had the US government levied an
economic emergency tax of 15% on only investible assets (i.e., not entire net
worth) in excess of $1 million, it could could have covered the entire 2009
deficit. And of course 99% of the population would have been exempted
from that tax.</DIV>
<DIV> </DIV></BLOCKQUOTE>
<DIV dir=ltr><FONT size=2 face=Arial>I read "investible assets" as "invincible
assets" on my first take. </FONT></DIV>
<DIV><FONT size=2 face=Arial></FONT> </DIV>
<DIV><FONT size=2 face=Arial>That's because I need a nap..., but I am wondering
if my first take doesnt describe the situation, cynically.</FONT></DIV>
<DIV><FONT size=2 face=Arial></FONT> </DIV>
<DIV><FONT size=2 face=Arial></FONT> </DIV>
<DIV dir=ltr><BR></DIV>
<BLOCKQUOTE
style="BORDER-LEFT: #000000 2px solid; PADDING-LEFT: 5px; PADDING-RIGHT: 0px; MARGIN-LEFT: 5px; MARGIN-RIGHT: 0px">
<DIV style="FONT: 10pt arial">----- Original Message ----- </DIV>
<DIV
style="FONT: 10pt arial; BACKGROUND: #e4e4e4; font-color: black"><B>From:</B>
<A title=galliher@illinois.edu href="mailto:galliher@illinois.edu">C. G.
Estabrook</A> </DIV>
<DIV style="FONT: 10pt arial"><B>To:</B> <A title=ewj@pigs.ag
href="mailto:ewj@pigs.ag">E.Wayne Johnson</A> </DIV>
<DIV style="FONT: 10pt arial"><B>Cc:</B> <A
title=peace-discuss@lists.chambana.net
href="mailto:peace-discuss@lists.chambana.net">peace discuss</A> </DIV>
<DIV style="FONT: 10pt arial"><B>Sent:</B> Sunday, August 15, 2010 10:04
PM</DIV>
<DIV style="FONT: 10pt arial"><B>Subject:</B> Re: [Peace-discuss] trying
times? - John Williams</DIV>
<DIV><BR></DIV>"The history of all hitherto existing society is the history of
class struggles." The goal of our politics is to bring those struggles
to an end - "establish justice, insure domestic tranquility, provide for the
common defense, promote the general welfare, and secure the blessings of
liberty to ourselves and our posterity" - but they nevertheless still exist
and provide the motive force (not always perspicuously) for our daily
politics.<BR><BR>The current Great Recession is the culmination of thirty
years of the conscious politics of neoliberalism, which was a counterattack by
the ownership class against the demands for social democracy and the welfare
state that they had been forced to concede after WWII. Andrew Mellon,
Secretary of the Treasury in the Harding, Coolidge, and Hoover
administrations, said that "During a depression, assets return to their
rightful owners." (He meant himself and his friends.) The people's political
struggle in the 1930s and again today is to prevent that from happening,
insofar as possible.<BR><BR>Of course the dominant class, who understand the
situation, don't want that understanding spread abroad. What if the mass
of the population should realize that a class struggle was underway?
James Madison, the architect of the 1787 constitution, wrote that the purpose
of that document was to "protect the minority of the opulent against the
majority." <BR><BR>Madison's system works remarkably well two centuries
later. We have a small active political class - about 20% of the population
(roughly those who went to good colleges - in America more than elsewhere,
class is established by formal education, which is why it's corrupt) and two
dominant business parties to champion and effect policies substantially to the
right of those favored by a majority of the population. <BR><BR>But the
difference between the policies of the parties and the interests of the people
is covered by the one real innovation of the American 20th century, public
relations. "The twentieth century was characterized by three developments of
great political importance: the growth of democracy, the growth of corporate
power, and the growth of corporate propaganda as a means of protecting
corporate power against democracy''.<BR><BR>The point of the party system is
precisely to obscure the class struggle, so it's difficult to see how the
struggle would be permitted to generate a third (or second) party. It's
true that e.g. European ruling classes in the 20th century had to concede
explicitly working-class parties, but they were quickly recaptured for the
dominant classes (cf. the Labour party in the UK). And the US has never had to
make that concession. The only successful third party in US history - the
Republicans - arose from a split in the ruling class so serious and
fundamental that it resembled an international war (cf. France and Germany in
1914).<BR><BR>I don't therefore see "the development of a major third party
that could knock out either the Republicans or the Democrats as a second
party." It is however true that "pocketbook issues tend to dominate
elections"; that's why economic issues have to be spun so: "corporate
propaganda [is] a means of protecting corporate power against
democracy.''<BR><BR>I think the current deficit scare is like that. It's
economic McCarthyism. The notion of an unpayable debt and an a
corresponding runaway inflation is like the threat of a Communist takeover in
the US fifty years ago - designed to deflect real public "pocketbook"
demands.<BR><BR>It's also true that "Unemployment will be [is] a lot worse
than most people expect. Housing will continue to suffer in terms of weak
demand." But inflation is unlikely, while deflation is a real
possibility. US monetary authorities are attempting to titrate the matter so
that "assets return to the rightful owners" rather than to the
people.<BR><BR>The government pleads poverty to justify the assaults on
Medicare and Social Security, but it doesn't face bankruptcy. The principal
result of thirty years of neoliberalism has been an immense and accelerating
concentration of wealth in very few hands. The first tactical victory in
the current class struggle would be a tax on that wealth.<BR><BR>Consider the
richest one per cent of US citizens. In 2009, their investible assets - i.e,
not including their primary residence, art works, collectibles, etc. - totaled
over $12 trillion. In that year, the total US budgetary deficit was $1.7
trillion. Had the US government levied an economic emergency tax of 15%
on only investible assets (i.e., not entire net worth) in excess of $1
million, it could could have covered the entire 2009 deficit. And of
course 99% of the population would have been exempted from that
tax.<BR><BR>There are reasons for the US government to run some deficit, as
Keynes explained, but it's also better to tax the necessary funds from the
rich than to borrow them - and pay interest on them. It's only the successful
class struggle by the American rich over the past generation that has seen the
degree of equality of wealth - which peaked in the late 1960s - fall back to
the inequality that obtained before the 1929 crash. Neoliberalism has so far
been a winning strategy in the American class struggle.
<BR><BR>Encouraging panic about the deficit and inflation is its current form.
It's fueling the Obama administration's attack on "entitlement
programs." (Language of course is a weapon in the struggle: what if
Social Security and Medicare were instead called "economic justice" programs -
or "reparations"?) If we want to reverse the massive redistribution of wealth
"upwards" over the last generation, the way to do is by taxing wealth, not
borrowing it. <BR><BR>Those tea-partiers who say they're "taxed enough
already" are certainly right. And the tea-partier who carried a sign
saying "Government hands off my Medicare!" was ridiculed only by those (common
in the media) who were serving the interests of the wealthy. The demand is
quite correct.<BR><BR><BR>On 8/15/10 1:57 AM, E.Wayne Johnson wrote:<BR><SPAN
style="WHITE-SPACE: pre">> The circumstance is open for the development of
a major third party<BR>> that could knock out either the Republicans or the
Democrats as a<BR>> second party. Over time, pocketbook issues tend to
dominate<BR>> elections. If things are going well, if people are
prosperous, they<BR>> ignore the corruption in political circles as being
just part of the<BR>> system. But when they're hurting, they turn out the
bastards and look<BR>> to put in some change. We sure need change. I can
tell you that. It's<BR>> not just one party. Both major parties have an
equal share of guilt<BR>> in what's unfolding. Whichever one is in power
keeps making it<BR>> worse...<BR>> <BR>> Unemployment will be a lot
worse than most people expect. Housing<BR>> will continue to suffer in
terms of weak demand. But in this crazy,<BR>> almost perverse circumstance,
the renewed weakness to a large extent<BR>> will help push us into higher
inflation. Real estate tends to do<BR>> better with higher inflation, but
it's not going to be a happy<BR>> circumstance for anyone.<BR>> <BR>>
The government is effectively bankrupt. Using GAAP accounting<BR>>
principles, the annual deficit is running in the range of $4 trillion<BR>>
to $5 trillion. That's beyond containment. The government can't cover<BR>>
it with taxes. They'd still be in deficit if they took 100% of<BR>>
personal income and corporate profits. They'd also still be in<BR>> deficit
if they cut every penny of government spending except for<BR>> Social
Security and Medicare. Washington lacks the will to slash its<BR>> social
programs severely, to change its approach to ever bigger<BR>> government.
The only option left going forward is for the government<BR>> eventually to
print the money for the obligations it cannot otherwise<BR>> cover, which
sets up a hyperinflation...<BR>> <BR>> Read more: <A
class=moz-txt-link-freetext
href="http://www.theenergyreport.com/pub/na/7005">http://www.theenergyreport.com/pub/na/7005</A>
Again, putting<BR>> aside election year politics and such, the banking
industry will need<BR>> further bailout as solvency issues come to a head
again. The federal<BR>> deficit is going to balloon. It's going to blow up
much worse than<BR>> any formulas would give you, and Treasury funding
needs will<BR>> explode....<BR>> <BR>> <BR>> <BR>> <BR>>
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