Tuesday, January 31, 2012

Kyrgyzstan: Gold Mine Could Exacerbate Central Asian Water Woes...

Kyrgyzstan: Gold Mine Could Exacerbate Central Asian Water Woes...

Russian oil slick for Croatia, as described by a Ziocon...

Russian oil slick for Croatia, as described by a Ziocon...
By Vladimir Socor

Croatia has become the newest member of the European Union, with a national referendum on January 22 capping the accession process. The government-controlled JANAF (Jadranski Naftovod - Adriatic Oil Transportation) enterprise, however, has marked the country's EU accession in its own way. It has opened the way for Zarubezhneft and, potentially, other Russian state-controlled companies to expand into Croatia and beyond, in preference to EU partners, and blindsiding Croatia's newly installed government.

JANAF is an enterprise with strategic significance to landlocked Central Europe. JANAF's Adria oil pipeline, running from the deep-water tanker port Omisalj (Krk Island) toward Hungary, enables Central European countries to pursue supply diversification, mitigating their dependence on Russian oil from the Druzhba pipeline. Druzhba's southern branch delivers Russian oil via Ukraine to Slovakia, the Czech Republic, and Hungary. The Adria option, meanwhile, helps constrain the Russian suppliers' price leverage.

The Adria option is gaining in importance as Russia gradually reduces oil deliveries through the Druzhba pipeline, redirecting volumes toward Russia's own Baltic export terminals. Consequently, landlocked Central Europe will have to increase its reliance on the oil supply route from Croatia's Adriatic coast. This presupposes a JANAF independent of Russian oil interests. It also presages a growing role for Croatia as an energy transit country in a European energy security framework.

Zarubezhneft's move in Croatia seems mainly designed to block Central Europe's Adria option and tempt JANAF into long-term dependence on Russian business. Zarubezhneft CEO Nikolai Brunich first aired this offer on January 17 in Zagreb through a news conference at the Russian Embassy (implying Russian government support for this initiative), followed by JANAF board chairman Ante Markov with extensive supportive comments in the ensuing days.

The offer consists of three inter-related investment projects with a combined value of more than 1 billion euros (US$1.5 billion) by this preliminary estimate. The investment projects include:

1. Reviving the Druzhba-Adria oil transportation scheme. This familiar proposal involves using JANAF's pipeline on Croatian territory in the reverse direction, north-south, for Russian oil exports through Croatia's Omisalj port to international markets. In that case, port and pipeline capacities would no longer be available for non-Russian oil supplies in the originally intended direction, from Omisalj toward Central Europe. Reverse-use in Croatia would mirror the reverse-use of Ukraine's Odessa-Brody pipeline (2004-2010), north-south for Russian oil exports, instead of south-north for Caspian oil to Central Europe as originally intended. Reverse-use is an access-denial tactic against competitors, accompanied by below-capacity use of the pipeline, once control is achieved. Zarubezhneft suggests using the Adria pipeline and Omisalj storage tank farm for Russian oil companies' exports to spot markets.

According to Brunich, Russia's oil pipeline monopoly Transneft might buy an ownership stake in JANAF in the event of the latter's privatization. JANAF's transit system on Croatian territory comprises three main spurs with a combined working capacity of 20 million tons annually (design capacity: 34 million tons per year). The system is currently operating far below those parameters (at 30% of capacity, according to some estimates).

The existing spare capacities could accommodate a growing flow of non-Russian oil to Central Europe, so as to replace the Russian oil volumes re-directed by Moscow from the Druzhba pipeline. However, Russian reverse-use of the Adria pipeline (even below its capacity) could block the flow to Central Europe, and compromise Croatia's prospects as an energy transit country within the EU.

2. Building a new pipeline for transportation of oil products - mainly gasoline and diesel fuel, from Zarubezhneft's Bosanski Brod refinery (Republika Srpska in Bosnia), to run via Croatia to Omisalj port.

Storage capacities would be built near Zagreb and a new terminal for oil products would be constructed in Omisalj. This product pipeline could also be connected with Gazpromneft's Pancevo and Novisad refineries in Serbia, in which case Gazpromneft could participate in this pipeline project. According to Brunich, either Zarubezhneft or Transneft would acquire an ownership stake and operational control of this oil-product pipeline in Croatia. The Russian companies would in that case use Omisalj's terminal and storage for exporting their oil derivatives, which they plan to upgrade to EU environmental standards by 2015.

Additionally, Zarubezhneft proposes to buy Austrian OMV's network of fuel stations, which OMV intends to sell off in Croatia and Bosnia-Herzegovina. With this, Russian state companies would be moving into the core market of Croatian INA (leading shareholder: Hungarian MOL). These combined moves, if accomplished, would usher in a second phase of Russian oil companies' expansion into south-eastern Europe.

3. Launching exploratory drilling at nine Croatian oil and gas fields - including onshore sites in the Slavonia region and offshore sites on the Adriatic shelf.

If successful, exploration would be followed by production contracts. Croatia's oil and gas company INA (with Hungarian MOL as leading shareholder) plans to participate in the tender for those sites; but Zarubezhneft seems intent on circumventing that process with JANAF's help. Zarubezhneft wants 51% ownership in this project through a local subsidiary of its own; it has brought an obscure, untested minority partner in its tow; and it offers a 10% stake to JANAF. Initial investment is estimated at 100 million euros; but JANAF would only have to pay a symbolic sum of 37,000 Croatian crowns (kuna) (US$64,000) for its 10% stake, with a title to 10% of the profits, if the project is successful. JANAF also anticipates earning fees for transporting the hoped-for oil through its pipelines.

This proposal seems crafted as an outright gift to JANAF, with earnings to come at zero risk and for zero investment. JANAF's management board has embraced this rent opportunity. It looks like a reward for assisting Zarubezhneft's attempt to prevail over INA.

JANAF seems keenly interested in Zarubezhneft's proposals. JANAF claims that the second and the third compartments (of the three above) had already been approved by Croatia's government in mid-to-late 2011; or at least that the government was notified and made no objections. The parliamentary elections of December 2011 resulted in a change of government, however. The former government's key figures (prime minister, economy minister, investment minister) and the Croatian side of INA's management all deny having approved or even having been informed about those intentions.

The new Croatian government seems taken aback by these developments. Prime Minister Zoran Milanovic, First Deputy Prime Minister Radimir Cacic (responsible for energy policy) and other officials are reacting with cautious skepticism. To get at the facts they have commissioned a review of agreements concluded or approved by the previous government, and have extended the tender deadline for the nine oil and gas exploration sites while reviewing the tender's conditions. The government takes the position that JANAF must remain in Croatian ownership, in view of this transit system's strategic significance.

State-owned Zarubezhneft claims that it has enough spare cash for new investments. The company is buying a minority stake in Alrosa's Siberian gas projects (non-core business of Russia's diamond monopoly).

Meanwhile, the Russian government is discussing the possibility of merging Zarubezhneft with the much larger pipeline monopoly, Transneft. This would enable Transneft to co-own or operate pipelines built by Zarubezhneft beyond Russia's borders. Such could be the case with the proposed oil product pipeline and terminals in Croatia, if this becomes a Zarubezhneft project there. Russia's Economic Development Ministry favors a Transneft-Zarubezhneft merger, but others are skeptical. Transneft vice-president Mikhail Barkov says that the company would seek the operating rights, if Zarubezhneft builds a product pipeline in Croatia.

On the whole, the proposals seem designed to draw JANAF into a relationship of dependence on the Russian state-controlled oil business. The offer implies rent-type earnings for JANAF, in return for aiding the expansion of Russian oil interests in the region. By the same token, it would undermine JANAF's strategic independence and constrain its decision-making in the future.

All this would compromise Croatia's prospects as an oil transit country in the framework of the EU. The Croatian transit system, however, stands to gain in importance for diversification of oil supplies from the Adriatic coast to Central Europe. The Russian offers just made in Zagreb are another attempt to deprive Croatia of that prospect.

India categorically rejects Iran oil sanctions, as Persian guile drives Israel crazy...

India categorically rejects Iran oil sanctions, as Persian guile drives Israel crazy...

Finance Minister Pranab Mukherjee has set at rest firmly and authoritatively all speculative reports that India might buckle under American pressure and fall in line passively with the spirit of the United States’ sanctions against Iran by quietly cutting back its oil imports from Iran. That FM made the categorical statement while on a visit to the US is of added significance.

Earlier, ambassador to the US Nirupama Rao created some confusion by claiming India was cutting down its oil purchases from Iran as a considered decision. Rao was speaking after American politicians and commentators began making threatening noises as part of a psywar. According to media reports, she vaguely hinted that India was acting in tandem with Washington.
Of course, Mukherjee’s statement has hit the headlines, as it follows similar indications from China. With China and India defying the US’ sanctions regime, Japan and South Korea and other south-east Asian countries would follow suit. Tehran Times has reported that Delhi is actively exploring various options to work out a payment mechanism for India’s oil imports from Iran and is “trying to buy as much Iranian oil as possible.”
The Beijing daily Global Times featured an editorial today calling on China to coordinate with south and southeast Asian countries and “try its best to form a temporary alliance with them in continuing to buy oil from Iran. Such an alliance is possible, as seen from the hesitation of countries like Japan and India in sanctioning Iran.” The editorial anticipated that at some point Washington might even offer to Beijing some trade-off but China won’t cave in as Iran is far too important a relationship to compromise.
The GT editorial carries forward the train of thought that the paper fleshed out in an earlier article a fortnight ago when it inter alia called for coordinating with Russia - “the two should support each other in this [Iran] matter.”
India and China would also factor in that the European Union sanctions against Iran might not prove sustainable in any case. The panic in the European capitals was obvious when Iran threatened retaliation. Within hours, back channels were apparently activated to prevail upon Tehran not to go ahead with its own embargo on oil exports to Europe this week (six months before the EU sanctions will come into effect). It seems Tehran has obliged the European entreaties but its threat of retaliation hangs like the sword of Damocles on the European economies.
Clearly, the assumption that Iran will be brought to its knees through oil sanctions is flawed. Iran has successfully withstood 30 years of US sanctions. It is also wrong to caricature Iran as a chronic case of the so-called Dutch syndrome. Iran has a diverse economy, its human resources are very substantial and it can progress even with reduced oil income.
That is to say, all this drama is actually geopolitical. Evidently, Iran is keen not to exacerbate the tensions. The latest indications are that Tehran is constructively engaging the IAEA inspectors although holding fast to its principled position on the nuclear issue, namely, that it has every right to pursue a nuclear programme as stipulated under the NPT.
All things taken into account, therefore, Delhi has done exceedingly well by taking such a clear-cut stance on the entire question and its ramifications.

Persian guile drives Israel crazy...

I am not surprised that Hebrew indeed has a popular expression, ‘Hold me back’. It’s a convenient thing to say in a street fight when you tell the bystanders to hold you back so that you don’t hit the big chap in front of you who towers over you and can make pulp out of you if he chooses to.

Israel is a grandmaster in using this expression with perfect timing. Timing is important, because you know if it is articulated even a clutch of minutes too late, you are left with no option but to hit the big guy, which of course would have disastrous consequences. And, alternatively, if you don’t hit, you get badly exposed as the little guy who keeps pretending he is what he isn’t in actual prowess.
Predictably, Israel is once again reviving the ‘threat’ that it is about to attack Iran. Al Jazeera has a useful piece by the well-known American Jewish commentator M J Rosenberg giving the chronicle of such Israeli threats in current history. Of course, none of those threats in the recent years was carried out. Reason? It’s rather simple: Israeli military and security establishment is inhabited by cooly rational human beings who would know their country’s real military strengths and weaknesses and won’t allow themselves easily to get carried away by insane politicians.
So, why does Israel make a living out of making such hollow verbal threats? Actually, the threats aren’t that hollow, either. They have a greater logic and they serve a purpose. Israel is conveying a message to the political class in Washington : ‘Do something more on the Iran front’. In the present case, too, the timing is important. Nothing horrifies Israel more than the prospect of the negotiations resuming on the Iran nuclear issue. Israel is terrified of the spectre of the ‘5+1′ negotiations gaining traction. Derailing the diplomatic / political track is, in essence, the constant Israeli objective. Israel knows that the logical next steps of the diplomatic track would sooner rather than later bring the Iranian and American diplomats face to face.
So, Israel is resuming the plea, ‘Hold me back’. Read the hilarious AP dispatch conveying the desperate mood in Israel. The israeli war cry is already beginning to resonate in Washington. The folks on The Hill, who receive generous funding from the Israeli Lobby, are scurrying around seeking more action on Iran. Another set of US sanctions against Iran seems to be in the works.
The US administration has a problem on its hands. It also needs to pay heed to the warning by the influential Fox News that Iran could prove to be the ‘wild card’ in the 2012 presidential election. President Barack Obama knows this is going to be a tight race — unless Newt Gingrich manages to secure the Republican ticket and makes a fool of himself in the campaign in comparison with whom the incumbent president looks an infinitely better proposition.
The challenge facing Obama is to ride out the wave of the Israel-driven war hysteria and finesse it so as to garner political mileage out of it in the campaign, but without really having to go to a war with Iran (for which, Obama knows better than anyone else on the planet that America lacks the capacity or motivation). Ideally, Obama’s cause would have been well served if he had the option to go for a limited military strike against Iran — like Bill Clinton did by firing the odd cruise missiles at Kandahar from a safe distance — but it is a non-option today unless there is absolute, fool-proof, one hundred percent, verifiable guarantee that Tehran won’t retaliate, which of course is lacking.
Fortunately, Obama has a seasoned politician in defence secretary Leon Panetta. So, Panetta has taken over. He quickly revises his earlier opinion and now says Iran would have the capacity to make a bomb within an year if it indeed decides to have one and if that happens, and if the US intelligence gets evidence of Iran having a nuclear programme, then, he wouldn’t rule out exercising any option to prevent Iran on its track. Fair enough. It is a conjecture that doesn’t have to unduly upset Tehran. At the same time, he has not contradicted the Israelis although he may have poured a bit of water on their hysteria over Iran.
Meanwhile, Pentagon has dispatched more warships to the Persian Gulf. The great danger in this ongoing charade is that at some point without any of these able protagonists quite intending it, a spark may appear that may well escalate into an apocalyptic conflagration in no time.
The Israeli fear of having to live on a lonely planet isn’t without basis, though, given Iran’s savviness on the diplomatic front. Iran has complete mastery of the art of diplomacy and trusts its skills to serve the country’s core interests as far as possible. The post-2003 Iraqi saga is a brilliant example.
Unsurprisingly, Iran has already begun making good political capital out of the current visit by the IAEA inspectors to Tehran. The IAEA team includes two carefully hand-picked weapons inspectors who probably set out from Vienna with the brief to somehow put Tehran on the mat. But Iranian hosts are now pleading with them to extend their 3-day visit beyond January 30 so that they can visit even more nuclear installations and talk to the Iranian scientists and satisfy themselves there is no bomb-making programme.

Posted in Diplomacy, Politics. By M K Bhadrakumar

“I was personally present when the deputy economics minister of Iran was talking to a foreign society in Berlin”

“And the gentleman said very openly to the shocked audience ‘OK. You don’t want to buy our goods. Well, the Chinese do.’”—Christoph R. Horstel

Remember the real reason why Moammar Gadhafi is dead. He dared to propose and started creating an alternative currency to the world reserve U.S. Dollar. The lesson learned in Libya is now ready for teaching in Iran. Forget all the noise about going nuclear, the true message is that the banksters rule and nation states serve their ultimate masters.

The hype and disinformation that surrounds the push for war is best understood by examining the viewpoint of Iranian MP Kazem Jalali. The Tehran Times quotes him in saying,

“The European Union must be aware that it can never compel the Islamic Republic to succumb to their will and undermine the Iranian nation’s determination to achieve glory and independence, access modern technologies, and safeguard its rights, through the intensification of the pressure.”

“The European Union is seeking to politicize the atmosphere ahead of nuclear talks with Iran and is aware that sanctions on Iran’s oil exports cannot be implemented since the world is not limited to a number of European countries”

Many political commentators warn that an embargo is an act or war. Chris Floyd provides this observation of the recent oil embargo against Iran:

“This week, the warlords of the West took yet another step toward their long-desired war against Iran. (Open war, that is; their covert war has been going on for decades—via subversion, terrorism, and proxies like Saddam Hussein.) On Monday, the European Union obediently followed the dictates of its Washington masters by agreeing to impose an embargo on Iranian oil.

“The embargo bans all new oil contracts with Iran, and cuts off all existing deals after July. The embargo is accompanied by a freeze on all European assets of the Iranian central bank. In imposing these draconian measures on a country which is not at war with any nation, which has not invaded or attacked another nation in centuries, and which is developing a nuclear energy program that is not only entirely legal under international law but is also subject to the most stringent international inspection regime ever seen, the EU is “targeting the economic lifeline of the regime,” as one of its diplomats put it, with admirable candor.”

The most important aspect of the Iranian response lies in the way that changes oil settlement for delivery and the futile effect of the US/Anglo/EU imperialist dictates have in the marketplace.

Debkafile reports that India (and probably China) will pay for Iranian oil in gold:

“India and China take about one million barrels per day, or 40 percent of Iran’s total exports of 2.5 million bpd. Both are superpowers in terms of gold assets.

“By trading in gold, New Delhi and Beijing enable Tehran to bypass the upcoming freeze on its central bank’s assets and the oil embargo which the European Union’s foreign ministers agreed to impose Monday, Jan. 23. The EU currently buys around 20 percent of Iran’s oil exports.”

A more detailed analysis in Tehran Pushes to Ditch the US Dollar provided ample arguments that an embargo will fail:

“Iran may be isolated from the United States and Western Europe, but Tehran still has some pretty staunch allies. Iran and Venezuela are advancing $4 billion worth of joint projects, including a bank. India has pledged to continue buying Iranian oil because Tehran has been a great business partner for New Delhi, which struggles to make its payments. Greece opposed the EU sanctions because Iran was one of very few suppliers that had been letting the bankrupt Greeks buy oil on credit. South Korea and Japan are pleading for exemptions from the coming embargoes because they rely on Iranian oil. Economic ties between Russia and Iran are getting stronger every year.

“Then there’s China. Iran’s energy resources are a matter of national security for China, as Iran already supplies no less than 15% of China’s oil and natural gas. That makes Iran more important to China than Saudi Arabia is to the United States. Don’t expect China to heed the US and EU sanctions much—China will find a way around the sanctions in order to protect two-way trade between the nations, which currently stands at $30 billion and is expected to hit $50 billion in 2015. In fact, China will probably gain from the US and EU sanctions on Iran, as it will be able to buy oil and gas from Iran at depressed prices.”

So why is the EU so determined to apply restrictions is answered in the video, Why does the EU join in sanctions against Iran?

Now that is part of the reason but for the entire story, one needs to confront the contentions in the You Tube Israel pulling the strings for war with Iran.

Where is gets so confusing for the casual observer is that any discussion that deems to be critical of Israel is a taboo discussion in polite company. Well, when it comes to addressing the impending prospects of a major conflict in the Middle East, the linkage between the deciding influences in American policy that coincide with a greater Israel objective, is silenced in the old-line press and media. Therefore, the key element to explore is the relationship of Zionist interests with the fundamental preservation of the paper currency imperium of Federal Reserve notes as the medium of payment for oil.

Think about this equation in light of ultimate control. Oil is the fuel that runs the engine of all economies. Money is the medium of exchange that pays for the petroleum. War is the universal method used to avoid the breakdown of the money recycling system. In The Petro-Dollar and the EURO, the nature of this formula is probed:

“War is always about achieving a political end. Even holy wars seek to impose a secular control over the vanquished. At the root of every political conflict, lies the MONEY component. On the scale of greed or fear, international discords can slide up or down. Depending on the circumstances or demands, governments rally domestic populations to accept their foreign interventionist goals. Claims of altruistic liberation are fictitious, when the rhetoric is stripped away and the real substance is exposed. Notwithstanding, variances of emphasis; the motive of money underpins the movements of all military confrontations.”

Who can deny that the interest of the Israeli state advances under the Petro-Dollar system for oil payment? The prospect of allowing an oil exporter to do business paid in gold disrupts the balances that maintain an uneasy political rapprochement. Even more threatening to the globalist monopoly is a defiant regime like the Islamic Republic playing by different rules that bypass central banking approval.

It seems that the neocon Christian Zionists will never be happy until they institute a techno drone bombing campaign to shut off even more oil resources. With Iraqi and Libyan production in shambles, it is now time to eliminate the Iranian resource. Spiking oil to $200 or more through another foreign intervention just hikes the balance sheets of the oil traders and banking interests. There is no doubt that foreign aid to Israel will rise at even a higher amount.

The bonus is that the gold hordes of Iran would become the spoils of war and conveniently find their way into the storage vaults of the banksters. This is a sweet game as long as there is a continuous supply of gung ho mercenaries to push the button of terror from the skies. Moreover, sending boots on the ground serve an even more profitable hellhole, the War Party can demand a much higher budget, floated with even more debt bought by China with the proceeds from the oil supply that are secured from the export of Canadian shale oil.

Miraculously, this pattern builds an even larger, if not, greater empire. As long as new villains are found to master, the Iran’s of the world will become subjugated under the background music of God Bless America.

What fools our fellow citizens became somewhere in the last century. Remember the John D. Rockefeller quote: “Competition is a sin,” especially if IRAN is the player.

Body bags are made from petroleum base material. In the height of irony, the oil wars are fought to secure the substance to form the burial cloth for disposable soldiers. If America really wants to stand behind the troops, their genuine duty is to prevent and oppose the next Middle East war.

Iran is not an existential threat to the United States. Haaretz reports that former Mossad chief Meir Dagan said in a television interview, “If Israel attacks Iran, it will be dragged into a regional war.” According to Dagan, Iran, Hezbollah and Hamas will respond with massive rocket attacks on Israel. In that scenario, Syria may join in the fray, Dagan said on the television program “Uvda.” Dagan added that such a war would take a heavy toll in terms of loss of life and would paralyze life in Israel.”

An America First foreign policy cannot wage another banksters war.

SARTRE publishes Breaking All the Rules.

Bernanke's Decision May Lead The Planet Into Financial Chaos...

Bernanke's Decision May Lead The Planet Into Financial Chaos...

With its announcement this week that it will keep interest rates near zero until at least late 2014, the Federal Reserve has put another large crack into the foundations underlying the US dollar. In a misguided attempt to provide clarity and transparency, Ben Bernanke has instead laid out a simple road map for economists and investors to follow.

The signposts are easily understood: the Fed will stop at nothing in pursuing its goals of creating phantom GDP growth, holding down unemployment, propping up stock and housing prices, and monetizing government debt. To do so, it will continue to pursue a policy of negative interest rates, while ignoring the collateral damage of unsustainable debt, virulent inflation, misallocated resources and credit, suffering yield-dependent retirees, and a devalued U.S. currency.

Not surprisingly, precious metals and foreign currencies rallied strongly on the news - with gold up more than 4.3% and the Dollar Index down nearly 1.6% in the days following the announcement. The Dollar Index is now down more than 3.5% from its highs in mid-January.

In coming to the momentous decision to extend the Fed's prior low-rate promises by another 18 months, Bernanke and his cohorts relied on a somber view of the economy that is at odds with the sunnier view presented the night before by President Obama in his State of the Union address. To justify holding rates so low for so long, the Fed is choosing to ignore the fact that CPI inflation is currently running north of 3%. Instead, it has conveniently chosen to look at a hand-picked alternative measure, the chain-weighted core PCE, which comes in just a shade below the Fed's arbitrary 2% target. How convenient.

After some changes in key membership at the Federal Reserve's policy-setting Open Markets Committee, in which a few long-time hawks were put out to pasture, the Fed has now established itself at the extreme dovish end of the policy spectrum. Among other central banks around the world, it may now be outflanked only by some very profligate ones in South America and sub-Saharan Africa. Unfortunately, the FOMC has its hands on the wheel of the world's reserve currency, and therefore its decisions may lead the planet into financial chaos as long as other nations are content to follow the Fed farther and farther into a swamp of liquidity. To paraphrase Pete Seeger's protest of the escalation of the war in Vietnam, "we are waist deep in the Big Muddy and the damn fool yells 'press on.'"

The only bright side of the announcement is that it provides precious-metal and foreign-equity investors a fairly good sense that they are on the right side of history. In order to keep rates low, especially at the long end of the yield curve where it matters most, the Fed must continually print money to buy U.S. Treasuries. This will likely push more investors into gold and away from dollar-denominated assets.

As a testament to their own faith in themselves to forecast economic conditions, 6 of the 17 voting FOMC members indicated that they would have preferred to keep rates close to zero at least through 2015. Some even had the audacity to prefer no change until 2016! This comes from the body that couldn't predict the 2008 financial crisis, even while it stared at them from point-blank range. To look into a completely uncertain future and determine that negative interest rates can persist for another four years without igniting inflation is to me the height of economic insanity. Sadly, the inmates have the keys to the institution.

The lunacy persists in the rest of the government as well, with Congress and the White House still failing to address our nation's long-term debt issues. The Fed's commitment gives these politicians a "Get Out of Jail Free" card to continue avoiding responsibility. The deficits will be monetized, so no real efforts need be made to cut spending or raise taxes on middle-class Americans. Central to these plans is the assumption that the rest of the world will happily park their savings in U.S. dollars forever. If the latest announcement does not disabuse the world of this notion, I don't know what will.

As long as interest rates remain far below the rate of inflation, the U.S. economy will fail to equitably restructure itself for a lasting recovery. As a secondary effect, U.S. savers will likely continue to suffer from a lack of yield and a weakening currency. In the end, the collapse of the U.S. economy will be that much more spectacular due to the great lengths we have gone to postpone it.

Next phase looming; a commodities war...

Next phase looming; a commodities war...

As the global trade system that had existed under the Bretton Woods II regime evolves and changes, we may see more struggles for key commodities.

12 Companies Join German Commodity Alliance...
By Michael Hogan

HAMBURG, Jan 30 (Reuters) - Twelve German companies have joined the new German alliance aimed at securing raw materials supplies in the face of growing competition for key commodities, the Federation of German industry BDI said on Monday.

In October 2010, Germany's government approved a new commodities strategy aimed at helping German industry secure supplies in the face of intense competition from China and other newly-industrialised countries which will include partnerships with supplier countries and greater cooperation between German commodity consumers.

A series of major German companies have been involved in talks about a project lead by German industrial association BDI to invest in foreign commodity projects and 12 have now agreed to join, the BDI said.

The founding members are copper producer Aurubis, chemical groups BASF, Bayer, Evonik Industries, Wacker Chemie < WCHG.DE> and Chemetall; carmakers BMW and Daimler ; steelmakers Georgsmarienhütte Holding, Stahl-Holding-Saar, ThyssenKrupp and electronics group Bosch.

"We are working together to build up a powerful corporation which will provide long-term improvements to Germany's raw material supplies," said BDI vice president Ulrich Grillo. Grillo is head of one of Germany's leading zinc processing groups Grillo-Werke AG.

"The alliance has the goal of taking shareholdings in commodity projects to achieve a long-term improvement in the supply of raw materials to industry," Grillo said.

"The commodity alliance will become involved in projects at an early phase which seek and assess reserves so as to give German companies the option of sourcing (raw materials) or taking shareholdings," Grillo added.

In specific cases the alliance may itself invest in projects to develop commodity reserves, he said....

The first phase of the alliance will involve clarification of legal and organisational questions and creating the corporate structure, the BDI said.

The establishment phase of the project is being supported by the Boston Consulting Group, Egon Zehnder, Hogan Lovells and PricewaterhouseCoopers, which will initially provide advice without payment, the BDI said.

The chief executive of the alliance is Dierk Paskert, previously an executive board member of German energy group EON .

The BDI said previously the alliance will focus on projects to secure supply of non-energy commodities, especially rare earths.

Consumers in many industrial countries have noted with concern how commodity-hungry China has been buying up supplies, especially with major deals in Africa.

There has also been major concern that China will restrict its own exports of rare earths used in a wide range of industries. (Reporting by Michael Hogan; editing by James Jukwey).

"We are witnessing the death of abundance and the borning of austerity, for what may be a long, long time."

Bill Gross

Crony capitalists are never interested in 'free markets,' only in creating monopolies and obtaining a license from the authorities for extracting rents. They alternately create artificial abundance and scarcity to influence prices, with the objective of lining their pockets.

This move by JP Morgan to enlarge their warehouses and stockpile key commodities helps to demonstrate the growing scramble for resources and at the same time the pernicious influence of mingling government guaranteed customer money and subsidized Federal Reserve funds with what is essentially private speculation.

JP Morgan is a bank that was rescued by public funds, and that exists at the sufferance of the US government and their money.

Still, there may be a mutual interest between the government and their bankers in influencing the world's flow of key commodities. And if a few friends become wealthy in the process, well, so much the better.

JP Morgan adds muscle to metal warehousing money
By Josephine Mason and Susan Thomas

NEW YORK/LONDON (Reuters) - Investment bank JP Morgan (NYSE:JPM - News) is bulking up its metal warehousing facilities in Rotterdam and Chicago, industry sources say, in a business that consumers complain deliberately delays delivery of metals to boost revenues from rent.

London Metal Exchange rules allow warehouse companies to release only a fraction of their inventories per day, much less than is regularly taken in for storage, creating long queues to get metal out and guaranteeing rental income.

JP Morgan's aim is to fill its Henry Bath warehousing arm with inventory in the two port cities large enough to rival trading house Glencore's Pacorini and U.S. bank Goldman Sachs'(NYSE:GS - News) Metro.

The Pacorini and Metro facilities in Vlissingen, Netherlands and Detroit combined are estimated to hold around half of the global London Metal Exchange (LME) aluminium stocks which stand at just under 5 million tonnes.

Sources at JPM say the bank is pursuing a strategy to consolidate warehousing in the two locations to create the next Detroit or Vlissingen. A JPMorgan spokesman declined to comment.

"They (JPMorgan) are rebuilding stocks again," a high-level industry source in the Netherlands said.

Complaints about long queues, particularly in Detroit, prompted the LME to raise minimum delivery rates - 3,000 tonnes a day for operators with stocks of over 900,000 tonnes in one city - but traders and analysts say the new rules will make little difference when they come into effect in April.

The JPM strategy is likely to inflame consumers and traders already angry about the influence of warehousing companies on the flow of metal.

J.P. Morgan is already preparing to store aluminium in Europe's largest port, Rotterdam, where it has over 30 sheds.

The bank, the largest by assets in the United States, was behind the cancellation of 500,000 tonnes of LME aluminium warrants in Vlissingen, just 50 miles away from Rotterdam, on December 21, traders and warehousing sources told Reuters. Cancelled warrants show metal is earmarked for delivery.

"They are taking material from producers or traders, or trying to get it out of the market place - they were lucky to get 500,000 tonnes out of Vlissingen -- and moving it to Rotterdam," said the industry source.

Citigroup analyst David Wilson said there had been a large number of copper cancelled warrants in St Louis and New Orleans, many carried out by JP Morgan.

"It wouldn't be a surprise if they wanted to move metal into their own warehouses," Wilson said. "The cancellations don't fit in with the underlying demand picture."

It is unclear how much metal JPM wants to eventually hold in the two locations, but to compete with its two closest rivals, it will require millions of tonnes, most likely aluminium which has the most ideal characteristics for long-term storage deals.

Glencore drove Pacorini's emergence as a dominant force in New Orleans and Vlissingen. The Dutch port holds nearly one million tonnes of aluminium.

Traders said Metro holds most of Detroit's 1.4 million tonnes of aluminium stocks, and is ideally located to attract surplus aluminium in North America.

There were other signs in recent weeks that the bank's focus has shifted after traders reported JPM sold a large number of warrants, or ownership titles to metal, to release funds.

"JPM have dumped a large amount of warrants or sold very cheaply," a senior source at a warehousing company said. "They've let go of a lot of warrants they were holding onto."

Read the rest

Have the power to imagine better....

America's Controlled Economic Implosion...

(adapted from Open proposal for US Revolution: end unlawful wars, parasitic/criminal economics; a call for Americans to lawfully, non-violently, and literally turn around/revolve from the 1% crimes that kill millions, harm billions, and loot trillions of the 99%’s dollars)

I’m going to discuss trillions of dollars in a moment. As an economics teacher, I understand numbers this large are extremely difficult to imagine. If you are among the majority with this difficulty, I recommend that you follow the expert testimony that paints the picture, and know that success in this area of public education transformation that unleashes trillions of our dollars for human creative capacity in unimaginable power is sufficient to end the current economic crisis.

This is the longest section of my call for Revolution. If you tire in reading, please consider that at trillions of dollars of annual public benefits, you literally have nothing more valuable to do than understand the following facts that document the theft of our money.

Please take your time with this. You can read it in sections. This minor investment of your reading to understand trillions to empower 100% of humanity includes contributions to Occupy’s success from many of our brightest economic minds.

Here we go:

Harvard’s Linda Bilmes co-authored a paper with Nobel Prize winner Joseph Stiglitz estimating the long-term costs of current US wars at now $3 to $5 trillion ($30-$50,000 per US household of $50,000/year income), with total debt increase since 2001 of over $10 trillion. Remember, as demonstrated by the evidence disclosed by our own government, all the reasons Americans were told to go to war were known to be lies as they were told and applicable law proves these wars Orwellian unlawful.

Just down the Charles River from Harvard, MIT’s Simon Johnson (and former Chief Economist of the International Monetary Fund) describes our economy being lead by gambling oligarchs who have captured government as in banana republics (his words), and might plunge the US into an economy worse than the Great Depression. From his article under the telling title, The Quiet Coup:

“Elite business interests—financiers, in the case of the U.S.—played a central role in creating the crisis, making ever-larger gambles, with the implicit backing of the government, until the inevitable collapse. More alarming, they are now using their influence to prevent precisely the sorts of reforms that are needed, and fast, to pull the economy out of its nosedive. The government seems helpless, or unwilling, to act against them.”

He concludes fraud is the heart of Wall Street. Under the poignant title, Goldman Sachs: Too Big to Obey the Law: “The behavior and de facto immunity of the biggest banks is out of control.” He cites the financial crisis was engineered by the largest banks to consolidate power: in 1995 the leading six banks had assets of 17% of US GDP; today they have 63%.

His immediate best-selling book, 13 Bankers: The Wall Street takeover and the next financial meltdown, was discussed with President Johnson’s Press Secretary and journalist with over 30 Emmy Awards, Bill Moyers, to explain the oligarchy, the loss of trillions of American taxpayer dollars to oligarchs’ manipulation as a matter of definitive fact, the oligarch’s looting of America is protected by their purchased political muscle, and without transformation “the next financial meltdown” is certain:

BILL MOYERS: Let me get to the blunt conclusion you reach in your book. You say that two years after the devastating financial crisis of ’08 our country is still at the mercy of an oligarchy that is bigger, more profitable, and more resistant to regulation than ever. Correct?

SIMON JOHNSON: Absolutely correct, Bill. The big banks became stronger as a result of the bailout. That may seem extraordinary, but it’s really true. They’re turning that increased economic clout into more political power. And they’re using that political power to go out and take the same sort of risks that got us into disaster in September 2008.

BILL MOYERS: And your definition of oligarchy is?

SIMON JOHNSON: Oligarchy is just- it’s a very simple, straightforward idea from Aristotle. It’s political power based on economic power. And it’s the rise of the banks in economic terms, which we document at length, that it’d turn into political power. And they then feed that back into more deregulation, more opportunities to go out and take reckless risks and– and capture huge amounts of money….The American democracy was not given to us on a platter. It is not ours for all time, irrespective of our efforts. Either people organize and they find political leadership to take this on, or we are going to be in big trouble, okay?… That’s absolutely the heart of the problem. I would also say and tell you, and emphasize, these people will not come out and debate with us. The heads of these companies or their representatives, they will not come out. They’re afraid. They don’t have the substance. They don’t have the arguments. We have the evidence. They have the lobbyists. And that’s all they have.

BILL MOYERS: They’ve got the power, the muscle, the money.

SIMON JOHNSON: They have money.

BILL MOYERS: You just have the arguments. You just have the facts. On your side.

SIMON JOHNSON: Absolutely. That’s exactly what it comes down to.

Most people don’t read professional economists’ writing. I do, and can tell you that leaders such as Simon Johnson are using unprecedented strong language to provide the facts. Again, in his choice of words: the US economy is under attack by a colluding and unlawful oligarchy. Without Revolution that forces political leadership to transform the US economy to serve the public rather than the oligarchy, as Johnson says above:

“The American democracy was not given to us on a platter. It is not ours for all time, irrespective of our efforts. Either people organize and they find political leadership to take this on, or we are going to be in big trouble, okay?”

Harvard’s Elizabeth Warren explains the economy in language just as fierce. She professionally observes that the US economy is run by “reckless gamblers” who exploit a system they know in advance will “privatizes gains and socializes losses.” She documents the increasing destruction of the US middle class as US financial “leaders” write their own laws “behind closed doors,” and choose regulators who will protect them and not the public in order to “fleece consumers.” As you may know, Ms. Warren is the Leo Gottlieb Professor at Harvard Law School and Chair of the Congressional Oversight Panel for the so-called “bailout” program.

Ms. Warren admonishes: the US economy is in the “last chapter” with “all the chips on the table.” She says either the US public will demand their political and economic leaders end the fleecing because they “took the cops off the beat,” or the US middle class will devolve to live from paycheck to paycheck as Wall Street’s debt peons, “and the game really will be over.”

The good news is that solutions to the crisis are simple.

But let’s first continue with crucial facts and testimony. Take a deep breath. This is the civic economics education leaders like you must be responsible for or else you’re damned for condoning US War Criminals and ongoing plunder of trillions of our families’ and children’s money.

Chris Hedges, Middle East Bureau Chief for the New York Times, best-selling author, and Pulitzer Prize recipient in 2002, writes that American taxpayers are on the road to permanent serfdom under a police state from oligarchs’ “rapacious looting” and their purchase of a politically-protected luxurious lifestyle. He calls our economic system “criminal” and “totalitarian capitalism” lording over the exploited slave-labor class the American public has become (Resist or Become Serfs and video, “Chris Hedges on poverty and the permanent lower class”). Mr. Hedges also writes and lectures that current US wars are criminal Wars of Aggression (here, among dozens of his works). From Wall Street will be back for more:

“These corporations don’t make anything. They don’t produce anything. They gamble and bet and speculate. And when they lose vast sums they raid the U.S. Treasury so they can go back and do it again. Never mind that $50 trillion in global wealth was erased between September 2007 and March 2009, including $7 trillion in the U.S. stock market and $6 trillion in the housing market. Never mind that the total amount of retirement and household wealth trashed was $7.5 trillion or that we saw $2 trillion in 401(k)s and individual retirement accounts evaporate. Never mind the $1.9 trillion in traditional defined-benefit plans and the $2.6 trillion in nonpension assets that went up in smoke. Never mind the job losses, the foreclosures and the 35 percent jump in personal and small-business bankruptcies. There are bundles of new money, taken again from us, to make deals and hand out outrageous bonuses. And when these trillions run out they will come back for more until our currency becomes junk.”

Mr. Hedges poignant assessment matches the acknowledged government data. According to the US Senate Permanent Subcommittee on Investigations report, these financial oligarchs’ “trading” in non-wealth producing market derivatives increases the price of gasoline for all Americans somewhere from 33 to 60%. Market analysis in other commodities’ “trading” brings the total cost to American consumers of padded prices over $1 trillion every year. This is an incredible increase of prices to US households of ~$10,000 for every $50,000 of annual income!

“It’s one of the most frustrating things. We essentially have had modern-day bank robbers — except that they wore gray suits and not masks — and there’s been no accountability for it …

Every day we see energy speculators, war profiteers, managed health-care providers, media propagandists, and/or financiers given some unfair advantage over the average consumers and taxpayers, and the cumulative effect of the American people watching selfishness prevail over the public interest has been an undermining of the public’s trust in government.

There’s no question the system is rigged against the little guy. The bigger interests have a lot more information. They jerry-rig the system so that they always win.” – Senator Byron Dorgan

This admission is crucial data. However, considering Elizabeth Warren and Simon Johnson’s expert testimony of a captured government who collude rather than end this parasitic cost to Americans, the Senate report should force government compliance under existing law to stop cartels, not merely report on how many trillions they’re costing the American public under the Senate’s “oversight.”

Nobel Prize-winning economist, former Chief Economist at the World Bank, Chair of the Council of Economic Advisors, and Columbia economics professor, Joseph Stiglitz, agrees the US economy continues under oligarchic domination:

“What the Obama administration is doing is…ersatz capitalism, the privatizing of gains and the socializing of losses. It is a “partnership” in which one partner robs the other. And such partnerships — with the private sector in control — have perverse incentives, worse even than the ones that got us into the mess.”

The economic fraud isn’t just protected by government non-regulation; the government is one of the principle embezzlers. The Pentagon admitted they “lost” $2.3 trillion dollars and then didn’t follow-up with investigation. The American public heard about this news only once that anyone has been able to document from corporate media. Let $2.3 trillion sink-in:

  • $23,000 for every US household, or
  • embezzling $1,000,000 from a military project 2,300,000 times, or
  • embezzling a million dollars a day for 6,300 years, or
  • embezzling over 600 million dollars a day, every day, for ten years.

The solvable problems center around economic policy that creates protected parasites that collect unregulated and illegal gambling profits on the way up (the FBI reported 80% of the subprime mortgage fraud came from lenders), subsidized losses through “bailouts” on the way down, and then celebrate with unprecedented bonuses to themselves while publicly claiming to be doing “God’s work.” Future bailouts get guaranteed in advance without questions by government, while the symbolic program to help struggling homeowners is hyped in corporate media but not implemented.

The most egregious documentation of government fraud is in the data of collective government Comprehensive Annual Financial Reports (CAFRs) that reveal trillions of our dollars invested while lying in omission that they have no money for budgets. This takes some time to understand; the data is explained and documented here. For an example to understand what this means, the University of California system (UC) had a budget deficit that resulted in thousands of students denied enrollment, thousands of staff laid-off, a 32% tuition raise, and a 10% employee pay-cut with furloughs to reduce education days. The deficit could have been fully-funded with less than one-fifth of one percent of California’s documented investments. And no, the amount required for retiree benefits is only one-half of one percent of the total; that’s the specious and usual “official” lie. The above link will walk you through those trillions, if this is of interest.

The cartels taking billions of our dollars are in many industries. Dr. Marcia Angell, former Editor in Chief of the New England Journal of Medicine and currently a Senior Lecturer at Harvard Medical School documents:

“The combined profits for the ten drug companies in the Fortune 500 ($35.9 billion) were more than the profits for all the other 490 businesses put together ($33.7 billion).”

Importantly, “profit” is distinct from “research” in understanding these figures. This is prima facie evidence of unlawful collusion among a cartel, yet government doesn’t investigate. Dr. Angell concludes that US government will never provide universal health care because both political parties’ “leadership” obeys health insurance companies’ lobbyists rather than legislate for the public good. The lack of health care kills about 45,000 Americans every year according to the recent study championed by Harvard’s Medical School. Cost-benefit analyses range between $100 to $300 billion annual cost increase to the US by keeping health care companies between doctors and patients. That is, Americans would collectively save $100 to $300 billion every year with universal health care, no insurance companies, and no administrative red tape.

Is academic economics the proper place to work for solutions rather than a Revolution? Let’s look.

In light of the evidence so far of oligarchic control in the US economy, it’s troubling that professional economics journals’editorial boards have half the members receiving money from the Federal Reserve. The Federal Reserve is the pinnacle bank of the current banking system; with a majority of shares owned by the same banks that Simon Johnson reports have consolidated their assets to 63% of US GDP. This circumstantial evidence suggests that professional consideration of ideas contrary to existing monetary policy may be censored. We’ll examine omission of competing ideas you’ll conclude should be under political and public consideration shortly.

Jeffrey Sachs, best-selling author and one of the world’s best-known economists, agrees that competing ideas are missing in government and corporate media of our most important economic areas. He sharply writes:

“Cynics believe that the Geithner-Summers Plan is exactly what it seems: a naked grab of taxpayer money for Wall Street interests. Geithner and Summers argue that it’s the least bad approach to a messy situation, in which we need to restore banking functions but don’t have any perfect ways to do that. If they are serious about their justification, let them come forward to confront their critics and to explain to the American people why the other proposals are not being pursued.

Let them explain the hidden and not-so-hidden risks to the American taxpayer of the plan that they have put forward. Let them explain why they are so intent on saving the banks’ bondholders, even the long-term unsecured creditors who clearly knew they were taking market risks in buying Citibank bonds. Let them work with their critics to fashion a less risky and less costly plan. So far Geithner and Summers tell us that their plan is the only option, but without a word of further explanation as to why.”

Leading academic economists testify that something is indeed missing from their understanding of crucial national economic understanding. Several professors from Harvard’s Economics Department admitted to the Boston Globe that they both didn’t see the economic collapse coming and don’t have solutions. They acknowledged limitations in their current theories and thinking:

“Everyone that I know in economics, and particularly in the worlds of academic finance and academic macroeconomics, is going back to the drawing board,” said David Laibson, a Harvard economist. “There are very, very, very few economists who can be proud.”

“You can’t just say, ‘I have a model for tremors that works great – I just can’t explain earthquakes,”‘ said Kenneth Rogoff, an economist at Harvard who has studied financial crises.

“We have a very restrictive set of language and tools, and we tend to work on the problems that are easily addressed with those tools,” said Jeremy Stein, a financial economist at Harvard. “Sometimes that means we focus on silly questions and ignore greater ones.”

Let’s examine some evidence of how Revolution for these trillion dollar issues can breakthrough what Harvard’s Professor Stein calls “silly questions” to demand professional cost-benefit analyses of alternative models of economic management clearly discussed by many of America’s brightest historical minds.

The Great Depression in the US (1929-1941) motivated professional economists to comprehensively and creatively address its causes. Upon consideration of previous US economic depressions in 1837, 1873, and 1893, prominent economists led by Henry Simons at the University of Chicago proposed monetary reform as the nation’s most effective and practical policy response, known as the Chicago Plan (and here). This proposal was endorsed by Simons’ colleague, Paul Douglas, Frank Graham and Charles Whittlesley of Princeton, Irving Fisher of Yale, Earl Hamilton of Duke, Willford King of NYU, and sent to a thousand academic economists for their input. Three hundred twenty responded to the mailed proposal and survey (an impressively high number for a cold-call proposal and survey) from 157 universities, with 73% in full agreement with the proposal, 12.5% in approval with various considerations in its implementation, and only 14% in disagreement.

Nobel laureate Milton Friedman would become the proposal’s best-known champion. Congressman Dennis Kucinich has current legislation proposed.

This proposal was the shift from banking industry creation of “money as debt” through loans (technically “credit” and not money because it exists only and always as increasing and unpayable debt in the macro economy), to the government creating debt-free money for the direct payment of public goods and services. This policy has several extraordinary benefits (details in the links):

  • The national debt is paid rather than always increased.
  • It’s the only policy that accomplishes the goal of full employment as the government becomes the employer of last resort.
  • This policy ends the economic crisis almost instantly; and once the program is established will guarantee no further unemployment crises.
  • If the GDP value of government employment exceeds its costs (consider infrastructure that returns far more than costs), the US would have the double benefit of decreasing prices as well as full employment.
  • For an example of interest, considering the US Department of Education reports that between 100,000 to 300,000 US public education positions are in danger of termination for the 2010-2011 school year, this policy creates money directly to rehire unemployed teachers and fill all school needs. Our current economic model will suffer the layoffs and decrease in education quality.
  • State-of-the-art infrastructure.
  • Elimination of almost all social costs of poverty.
  • If banking were nationalized rather than being “bailed out” in the present, interest rates could be non-profit (think 1 or 2% mortgages that would reduce the cost of homeownership by 50% and eliminate need for any state taxes).
  • Creating debt-free money could be combined with public-created credit. This could take the form of state-owned banks.

Despite 86% of academic economists in favor of this proposal, its 1934 policy proposal in Congress was defeated. Paul Douglas, leading economist and Senator from Illinois from 1949 to 1967 wrote:

“This proposal will of course be opposed by the bankers from whom it takes the lucrative privilege of creating purchasing power. It would however insure the safety of deposits, give large revenues to the government, provide complete social control over monetary matters and prevent abnormal fluctuations in the capital market. At the same time it would permit the allocation of productive resources…to remain primarily in private hands. All in all it seems the most promising program for the reform of our monetary and credit system…”

So: why isn’t this proposal considered by Harvard’s economists, Congress, and leading Americans known to you today?

Consider the possible answer of oligarchic control of American “leadership” for generations as we consider the next piece of revealing evidence: Thomas Edison and Henry Ford understood the mechanics of money, and went on a media tour together to explain this transformative education.

Thomas Edison’s 1921 media tour with Henry Ford included traveling to the site of a hydroelectric dam to explain to the public through the media the economic breakthrough to build the dam apart from the parasitic and captured finance we still have today that Simon Johnson and Elizabeth Warren so strongly describe. Edison explained fully to the New York Times reporter how public works can and should be funded by government directly creating and paying for the project. This is less than half the cost of the continuing method of government borrowing money. Edison concluded the interview by explaining that ideas for the public good that challenged corporate oligarchs have always been defeated by the oligarch’s purchased propaganda campaigns:

“Certainly there is a complete set of misleading slogans kept on hand for just such outbreaks of common sense among the people. The people are so ignorant of what they think are the intricacies of the money system that they are easily impressed by big words. There would be new shrieks of ‘fiat money,’ and ‘paper money’ and ‘green-backism,’ and all the rest of it – the same old cries with which the people have been shouted down from the beginning.

But maybe we have passed beyond the time when the thoughtful 2 per cent – you know, I gather from my questionnaire that only 2 per cent of the people think,” and Mr. Edison smiled broadly. “Maybe they can’t shout down American thinkers any longer. The only dynamite that works in this country is the dynamite of a sound idea. I think we are getting a sound idea on the money question. The people have an instinct which tells them that something is wrong, and that the wrong somehow centers in money. They have an instinct, also, which tells them when a proposal is made in their interests or against them.”

In conclusion of this section of literal trillion dollar importance, there is a human face to our current economic condition calling for Revolution.

We live in a present political/economic “leadership” environment that allows a million children to die from preventable poverty every month. These million human beings die every month, year after year, despite the investment to save their lives is less than 1% of our income (the annual investment is ~$100 billion a year for about a ten-year project to end poverty forever). In addition, every nation that has ended poverty has also reduced their population growth rates to sustainable levels. This human cost is remarkably under-reported compared with the death toll of 3,000 innocent lives on the one day of 9/11 (allegedly the reason for US wars – to stop such innocent loss of future lives).

Preventable poverty kills 30,000 every day, ten times the deaths on 9/11, for a total of over 100 million innocent human beings killed since 9/11. And please remember the 45,000 dead Americans every year and our combined annual loss of $100 billion to $300 billion because US political “leadership” chooses cartel profits over physician-managed health care.

According to Jeffrey Sachs, when polled, the American public think we give 25% of our government budget to help the poorest of the poor, are willing to give 10%, and would be outraged to understand the actual figure we give is less than one-sixth of one percent of our income. American media and political leadership allow this disinformation to continue at the cost of 30,000 lives every day while Congress passed HR 4173 to guarantee future so-called bailouts for banks at $4 trillion dollars without hearings.

In review, this section has presented data and expert testimony that the US “modern” economy is still a Robber Baron-era oligarchy. Logically, only one of the following two conclusions seems to be possible:

1. Either people like Jeffrey Sachs, Thomas Edison, 86% of academic economists in the 1930s, and others of our brightest historical American minds beginning with Benjamin Franklin and Thomas Jefferson were too stupid to understand that corporate bankers creating a national debt supply rather than a money supply is best for Americans, and best without consideration or ethical refutation of their competing and wrong ideas. Things like the banking bailout should be done without Congressional hearings and passed immediately when banking insiders say so because they’re experts. And just because what you’re reading proved government and corporate media Orwellian war lies, those two groups wouldn’t collude with corporate bank and finance cartels to parasitize millions, billions and trillions of dollars because they respect law and honesty with money. Oh, and Ron Paul, Dennis Kucinich, Paul Grayson and all the third parties are extremists with impractical ideas of monetary reform that don’t deserve explanation. Even though Pew Research reports 92% of Americans oppose our current economic management, we don’t need civic education on alternative models. Or…

2. The US “modern” economy really is an oligarchy that suppresses competing ideas and parasitically costs Americans trillions of dollars every year. Without Revolution, this parasitic cost will continue with current trends indicating the costs will increase.

“When our Federal Government, that has the exclusive power to create money, creates that money and then goes into the open market and borrows it and pays interest for the use of its own money, it occurs to me that that is going too far. I have never yet had anyone who could, through the use of logic and reason, justify the Federal Government borrowing the use of its own money… The Constitution of the United States does not give the banks the power to create money. The Constitution says that Congress shall have the power to create money, but now, under our system, we will sell bonds to commercial banks and obtain credit from those banks. I believe the time will come when people will demand that this be changed. I believe the time will come in this country when they will actually blame you and me and everyone else connected with this Congress for sitting idly by and permitting such an idiotic system to continue. I make that statement after years of study.”

- Wright Patman, Representative in the U.S. Congress from 1929 to his death on March 7, 1976, and Chair of the House Committee on Banking and Currency for 40 years. For 20 of those years, he introduced legislation to repeal the Federal Reserve Banking Act of 1913. This quote is from excerpts of September 29, 1941, as reported in the Congressional Record of the House of Representatives (pages 7582-7583).

Revolution unleashes trillions of our dollars. Revolution exposes and ends what history will frame as the end of “Robber Baron” corporate/political cartels. Revolution enters America into a golden age unimaginable in the present.

And fortunately, the structural solutions are obvious, simple, and have been understood and advocated by leading American minds for literally centuries. Even if the economic solutions proposed beginning with Benjamin Franklin are too complex for you to invest your time to understand, the case for Revolution should be obvious by the suppression of these competing ideas that either are worthy of consideration or should have been professionally refuted (“refutation” is distinct from denial or propaganda as Thomas Edison explained).

If you want more economic data that piles-on additional proof of an oligarchy collusion between corporate cartels and owned regulators looting our economy, I recommend the brilliant comprehensive explanation and documentation of David DeGraw in his no-holds-barred paper, “Time for law-abiding American citizens to stop paying taxes, start a new government?”

And if you’re ready to take the rational next step to embrace the possibility of economics that fully utilizes technology, watch Zeitgeist Addendum and/or Zeitgeist: Moving Forward. This planetary breakthrough potential is explained at The Venus Project.

“Every day, I saw more evidence about the evils humankind will inflict on their fellow humans to gain or maintain power… What is more, those who choose not to empathize may enable real monsters. For without ever committing an act of outright evil ourselves, we collude with it through our own apathy… If you choose to use your status and influence to raise your voice on behalf of those who have no voice; if you choose to identify not only with the powerful, but with the powerless; if you retain the ability to imagine yourself into the lives of those who do not have your advantages, then it will not only be your proud families who celebrate your existence, but thousands and millions of people whose reality you have helped transform for the better. We do not need magic to change the world, we carry all the power we need inside ourselves already: we have the power to imagine better.” – J. K. Rowling, Harvard Commencement, June 5, 2008