Dystopian Paradox

Maureen Dowd in her NYT column today bemoaned to the offshoring of domestic journalism including reporting. I posted the following comment to he article:

The USA will soon be a third world country unless the government takes back control of the generation of US money (read “dollars”). Private money generated by private financial institutions is accounted for with a dollar sign. Deregulation of the private financial sector combined with Nixon’s announcement to the world in 1970 that dollars will be redeemed only in Treasury debt has resulted in what we see today: the deterioration of our industry and the financial credit (debt) crisis.

Globalization has resulted in the inflation of non-productive assets, that is, assets that don’t find their way to fund increased industrial productivity. Interest income does not equate to increased productivity but only accumulation of dollars for those who own the assets that produce the interest. That has meant stagnation for those who work to make a living, including journalists.

Displacement of US industry with offshore facitlites and labor is but one result of our unregulated international financial system. Get your brighter investigative journalists to educate themselves about the interworkings and dynamics of the international private financial system.

Use the power of the pen you now hold to advance the well being not only of domestic journalism but rather all aspects of American industry. Get educated and then educate your readership before the owners of the NYT take your pens away from you.

I checked and my comment has been published (number 128 on the sixth page) but it didn’t make the editors’ selection list. Maybe the NYT management has on its editorial board the equivalent of a KGB political officer who serves side by side with military officers to keep them in line.

The Financial Accounting Standards Board issued a release yesterday setting out guidlines about how to value securities. Where have they been since 1933? You can read the whole thing here.

The release starts out with an introductory paragraph as follows:

“The current environment has made questions surrounding the determination of fair value particularly challenging for preparers, auditors, and users of financial information. The SEC’s Office of the Chief Accountant and the staff of the FASB have been engaged in extensive consultations with participants in the capital markets, including investors, preparers, and auditors, on the application of fair value measurements in the current market environment.”

So what rules and guidelines have the CPAs been using for the last 20 years? Seems to me we need to overhaul everything about our financial system, bar CPAs from doing audits and come up with a regulator scheme overseen by god to assure a legitamate reporting of financial information. Only problem is, the god might the god of Wall Street or the neocons. They most likely share the same god.

Maybe we need a new god. A god in which we can trust. We can’t trust the one referenced on our currency we are suppose to trust because the currency was issued by our government and we can’t trust our government.

Chapter 5 of By the Sword is now posted. Lisa and Ben escape into the bush. Jomo, Margie and Don meet danger in the bush.

Below is Jim Sinclair’s take on the fed and Treasury Department’s proposed bailout:

Posted On: Friday, September 19, 2008, 9:49:00 AM EST

Potential Infinite Bailouts To Explode Money Supply

Author: Jim Sinclair

Dear Friends,

1. Today’s reported potential infinite bailout of all and any portends, if adopted, is the largest increase in dollars outstanding since the Jurassic Age.
2. It closely models actions undertaken regarding the production of currency liquidity seen in the “Weimar Republic.”
3. It is reported now that more than 1000 hedge funds are on the rocks. This has the potential for a significant financial impact.
4. The only way to hide the numbers from the statistics produced by the suspected actions of the Fed is to value the indebtedness purchased at 100%, claiming a wash transaction.
5. The only conclusion is that when the smoke clears and the advertised actions have been adopted, nothing more dollar negative than this has ever occurred due to the potential expansion of T bills and therefore dollar supply explosion.
6. Gold is the only currency with no liability attached to it which, as you have seen recently, will be selected as the currency of the people.

Respectfully yours,

Jim

The Financial Times reported that UK’s Financial Services Authority banned short-selling of financial stocks. The result was a surge in UK bank shares traded in New York.

The SEC banned naked short-selling yesterday. Under those rules, the seller must deliver the shares by the close of business three days after the transaction.

Here’s what Jim Sinclair has to say on the issue:

Securities Regulators and State Attorney Generals Crack Down On Naked and Manipulative Short Selling

Author: Jim Sinclair

Dear Friends,

Let’s review the highlights of this important day:

Securities Regulators and State Attorney Generals came down hard on the practice of naked and/or manipulative short selling.

There was emphasis made on legal and illegal shorts that have had a habit of speaking poorly about situations they are short to others.

London followed suit to a reasonable but hopeful degree.

The Toronto Senior Exchange remains silent on the subject. If the TSX does not declare its participation by next week many companies . . . (more)

Lot’s of news and all of it’s related.

GM officially unveiled the Chevy Volt today, set to go on sale in 2010 for $40,000, about twice the price of other models of the same size. But this is a plug-in electric, designed to go 40 miles between charges. That would get most people to work and back without using any gas.

The big question is whether GM will be around in 2010. Because of the financial sector implosion, GM’s financial woes haven’t make headline news lately. GM has been burning cash like crazy and it’s going to be looking for liquidity sources before long.

Which brings up AIG. It’s got to get a lot of cash quickly or it may be heading into bankruptcy as early as tomorrow. GM may be hoping that the fed will participate in bailing AIG out as a sign that the fed will be available when GM’s number comes up.

As to the nominees take on the Wall Street sinkhole, Obama says the problem is faulty regulation of Wall Street while McCain blames it on greed. I guess the number of houses McCain and Cindy own doesn’t have anything to do with whether or not one or both of them are greedy. Maybe the only affect their wealth has on them is their seeming insensitivity to the plight of Americans who are out of work, or who do have work but can’t afford necessary healthcare.

Back to the Volt. GM isn’t expecting to make a profit on the vehicle initially. Moreover, Toyota and Honda are working on plugin electrics so the market is going to be competitive. The question is whether GM has a strategy with respect to the Volt any more rational than what has been it has always been, which is show the stockholders a profit this quarter and to heck with the future.

The strategy is different with the Volt in that it seem to include forgoing profits immediately in favor of becoming more competitive in the future. Some say it’s a big gamble for GM. It can’t be much of a gamble since GM is likely headed for the recycle bin irrespective of whether the Volt or its offspring ever shows a profit. Sources of liquidity are drying up worldwide. How much longer will China hold up the fed? Or does it have a choice?

I threw-up the I Think Therefore I Am a Bookstore with the idea of showcasing books that explore or involve strategic thinking. That term requires a definition. What I mean by that term is the intellectual process resulting in decisions and plans and the execution thereof that are consistent with achieving a predetermined goal.

A simple example of strategic thinking is to prepare for the worst and hope for the best. A simple example of non-strategic thinking is . . . (more)

Forward (as of September 9, 2008)

Last fall after I had read Barack Obama’s Dreams from My Father, I moved from one apartment to another in the complex where I reside. After I got a lot of stuff moved over including a couple of masks I acquired on a trip to Kenya in 1994, the movers sent two African American men to do the heavy lifting.

They asked where the masks came from and I told them Kenya and that Barack’s father was a native Kenyan. We talked briefly about Obama running for president, and one of them said “He doesn’t have a chance.”

After seeing the masks and the conversation Obama, I felt a sense of pride well-up in both these men. They somehow knew that I respected them. As I type this forward on September 9, 2008, I . . . (more)

Chapter One

Lisa

The cool morning of the Kenyan highlands carried the faint scent of wildlife. Golden light from the sunrise cast a warm glow over the vista. The strange shape of acacia trees, sculpted by giraffes, icon of the sub-Saharan Africa savanna. Equatorial East African plains at 3000 feet above sea level, the altitude moderating the climate from a daytime high in the 80s to mid 90s, and some of the nights cool enough for blankets. In 1994, only the remnants remain of one of God’s Edens.

Sweat from the palm of Lisa’s right hand rolled onto the heavy rifle it clutched as she and Don traveled in the Landcruiser over the rutted red-dirt road. Her face was expressionless, but her green eyes were alert, scanning the unique beauty of the landscape. Her fear never overpowered her sense of wonder of this land.

Don steered the Landcruiser to keep it on top of the ruts, his hands gripping the steering wheel firmly. His nervousness increased the volume of his voice when he was in the bush. “This place is . . . (more)

One of McCain’s criticisms of Obama is that Obama is not qualified to be commander in chief. The problem with this argument is that the logic is faulty. It’s based on several underlying assumptions that are not necessarily true. One is that McCain’s military experience makes him more qualified to be commander in chief. Another is that the president as such holds a military position. If that’s true, he or she should be decked out in military attire at least some of the time.

I accidentally bought a book by Andrew Bacevich copyrighted in 2005 entitled The New American Militarism. Bacevich is a Vietnam war veteran and a professor of international relations at Boston College. I had intended to purchase his new offering Limits of Power: The End of American Exceptionalism, but I got Militarism by mistake at Barnes and Noble a couple of weeks ago. So I’ve been reading it. My comments here include views Bacevich expresses in Militarism.

At the end of the cold war, the U.S. remained the sole super power militarily. Post cold war, the U.S. has displayed that power both as show and in two wars to demonstrate what we can do in a conventional war. Our military power became the single facet of our foreign policy under the Bush administration. Diplomacy was out. You’re either for us or against us and we don’t care what the rest of the world thinks. It would seem we got to where Hitler wanted to be.

The problem with this attitude is that it didn’t and still doesn’t reflect reality. We were not the world hegemon in 2003 when we invaded Iraq nor are we now. But the problem is that militarism has become a part of our mindset. It’s a an accepted, and embraced, component of our mainstream culture. The citizenry for the most part, and irrespective of whether so called liberal or so called conservative, has bought into the idea that we have been imbued with the divine right and duty to make history.

Moreover, the president has been catapulted from the position of commander in chief as a citizen to commander in chief as the top military officer. Bacevich states that the “framers of our Constitution designated the president as commander-in-chief as a means of asserting unambiguous civilian control.” He notes presidents George Washington, Grant and Eisenhower went out of their way to avoid their prior military identity while in office.

So what does Bush do, one who was in the reserves and maybe awol from that light duty? He dons a Navy flight suit and hits the deck of an aircraft deck as commander in chief of the military in a grand photo op in which he states “Mission accomplished,” referring to the Iraq war.

In a recent Bill Moyer’s interview, Bacevich said that a new president will change nothing regarding how we deceive ourselves into believing that we are destined to be the world’s police (one of our many misconceptions). Bacevich’s statement is supported both by Obama’s and McCain’s campaign rhetoric. Obama said in his acceptance speech that he would rebuild our military. McCain’s campaign continues to tout his Vietnam experience as a credential for qualification as commander-in-chief. Both candidates know that campaigning on a promise to reduce our military is political suicide.

What’s suicide is spending money you don’t have, both personally, at the business level, and at the governmental level. And that’s what we’ve been doing at all three levels for the last eight years. GM for example owes tons of money because its management thinks that it must show its shareholders profits each quarter; they did that with SUVs and trucks and now where are they. We did it personally with homes and cars we can’t afford and credit card debt. The fed creates money to keep this insane economic model in place as long as possible so that they keep their jobs and get reelected. We have a huge military with 100 or more bases around the world allegedly to keep oil coming in to keep the cars going we can’t afford financially or environmentally.

There are similarities of the to the run up to St. Helens explosion in 1980, to warning signs of an impending financial disaster now.

With Mt. St. Helens and other explosive volcanic eruptions (Krakatoa for example), the warning signs were tremblers. Maybe not so big on the Richter scale, but a warning that something’s going on underneath a volcano.

With our economy, and our standing in the world as alleged hegemon, we have warning signs: extremely volatile markets that indicate nobody knows where things are going to be in the relative short term; a challenge to our military might by insurgents in Iraq, Afghanistan and Pakistan along with Russia’s new assertiveness militarily.

David killed a giant with a rock. Achilles was done in by an arrow to his eponymous heal. Patrol boats sank heavy cruisers in WW II. A few missiles with conventional warheads can take out our aircraft carriers. A well placed bomb in a weak spot killed the Deathstar in Star Wars. The bigger and more complex our military hardware and organization designed to fight conventional wars, the more vulnerable they become to unconventional, cheaper, less ostentatious warfare.

A lot of bullies find out they’re not so tough just because they’re bigger. Kick ‘em in the crotch and suddenly they’re shorter than their intended victim. It’s fantasy to think that a huge military is going to keep us out of trouble. In reality, it’s a big part of our problem. Our main challenge doesn’t lie outside our borders. Our challenge is to come to grips with reality, to recognize that the problem is systemic- a disease within several aspects of our mainstream culture, and to take steps to treat not the symptoms but the disease itself.

Neither Obama nor McCain can bust our bubble during the campaign, the bubble that we are world hegemon, the bubble that was Dorothy’s vision while out of touch in lala land and in which the Good Witch of the North arrived. An apparition. As between Obama and McCain, the question is which one is more in touch reality and once in office will do something positive to get the U.S. headed in a sustainable direction.

For me the answer unequivocally is Barack. He’s demonstrated his executive skills in community organizing, and in his presidential campaign fueled on the audacity of hope.

Moreover, there’s no way I can buy into McCain’s Rovian guided, fear based campaign rhetoric. He plays on our citizens fears and prejudices. I can get a good feeling talking trash about somebody, especially a public figure that isn’t going to sue me. But I know it’s cheap to do so.

And I have hope that the U.S. citizenry will see above the baseness of McCain’s smear campaign, and elect Barack Obama, someone with proven organizational and executive talent.

The title of this blog is derived from a line in Reinhold Niebuhr’s serenity prayer that reads “Accepting hardships as the pathway to peace.” That line is this blog’s tagline. His prayer may be the most widely known of his works, and many if not most who are familiar with the prayer may not know where the prayer came from. Until this afternoon, I knew nothing about his scholarly works. I hope to learn a great deal more.

Last night, I caught the first few minutes of Bill Moyer’s one-hour long interview of Andrew Bacevich, who has a new book out entitled The Limits of Power: The End of American Exceptionalism. After listening for a few minutes, I turned the TV off because Bacevich’s words brought up pain I didn’t feel like feeling last night.

This afternoon after I finished some legal analysis I get paid for, I went to Bill Moyer’s spot on the PBS website and clicked on Friday’s post. It led me to a page which contained excerpts from Moyer’s interview of Bacevich. In the post, Moyer’s comments that:

A key message Bacevich takes from [Reinhold] Niebuhr is one of humility. Not only must we understand the limits of what a government — and its military — can accomplish, but we must resist the temptation to guide history towards some perceived purpose or end.

Some may wonder why this blog mixes personal philosophy with political and strategic thinking. The reason is that by definition, immutable laws and principles apply everywhere.They apply in every aspect of my life and the lives of all of us. I cannot cordon-off my personal, even private life as mutually exclusive of any other aspect of it. And if I operate outside the bounds of these immutable laws and principles, then I will surely fail. We can’t avoid the operation of these laws and principles by denying their existence or ignoring them.

Philosophy and science are both in search of the truth, as should be religion and spirituality. So if there are immutable principles, each of these disciplines properly practiced and applied, will discover and adopt them. Those that don’t will produce regimes that crumble.

I began my one and only novel in 1995 and completed it the summer of 2001. The novel contains some dialog between a medical doctor and an architect, who is one of the main characters. The architect posits the question, is a scientists or a novelist more likely to arrive at the truth? The medical doctor unequivocally maintains that the scientist would. The architect expresses the view that the one who has the greater humility is more likely to arrive at the truth.

After 9/11, the Bush administration took action based on the erroneous assumption that the United States through its military power is the world hegemon. We aren’t and never were, except possibly for a couple of years after World War II when we alone possessed operational nuclear bombs.

Our body politic is now swallowing a poison pill by accepting the proposition that our national security is contingent on continuous engagement in an unending global conventional war. But we are no longer hegemon if we ever were. And we cannot fund a perpetual global conventional war.

I question the motivation of Bush administration and those behind it including the neocons. They have a vested financial interest in perpetuating conventional warfare. There are far less expensive ways to defend the security of our citizens. But then what’s going to happen to Boeing and Lockheed and Haliburton and the jobs they produce if we stop funding conventional warfare? The same thing that’s happening to the U.S. automakers and the jobs they have produced.

So what do we do for jobs? Engage in sustainable enterprises. More on this later. For now, get use to the idea that we don’t live on the block that controls the neighborhood anymore. We still live on the same block, but it isn’t what it used to be in terms of dominance.

Humility is inversely proportional to our egocentricity and false pride. Egocentricity clouds objectivity, with the result that truth will be arrived at only by chance. Humility mitigates the power of our egos with the result that we can view our world more objectively.

We would improve the prospects for our future and our kids’ and grandkids’ futures by adopting some humility, rather than perpetuating this fantasy that we alone dictate history. This fantasy, a chimera of our false pride and egocentricity, will result in our complete humiliation and the disintegration of our society.

The specter of dystopia is staring us down as we collectively avoid eye contact with it.